Container leasing rates plateau amid global shipping market variations

The global Container Price Sentiment Index (xCPSI), which gauges industry optimism regarding future container prices, reached a peak of 83 in May, signaling strong expectations for rising prices. However, by mid-August, the index had significantly moderated to around 39.

On key routes from China to the US, leasing rates for 40-foot-high cube containers showed steady increases from July to August 2024. For instance, rates on the Ningbo to Seattle route rose from $695 in July to $858 in August. Similarly, leasing rates from Qingdao to Seattle climbed from $1,334 to $1,545 during the same period. Routes such as Shanghai to Savannah and Shenzhen to Seattle also experienced notable price increases. However, while some routes saw rising leasing rates, other stretches from China to the US have shown signs of decline, indicating that the previous upward trend is starting to plateau, as per Container xChange.

This stabilisation mirrors broader trends in average container prices for trading, which have also begun to level off after months of steady increases. Container leasing rates on routes from China to Europe, for example, increased steadily until June 2024, but have since plateaued, with some routes even experiencing slight declines.

In addition to these patterns, the global container market saw significant regional volatility in August 2024. Central Asia reported the highest increase in container spot rates, with prices rising by an average of 40 percent. The Middle East and the Indian Subcontinent followed with a 10 percent increase, while Japan and Korea experienced an 8 percent hike. These regional disparities underscore the complexities of the global container market and the varying demand dynamics in different regions.

"As we move through 2024, the stabilization of container leasing rates, particularly from China to key global destinations, reflects a market that is adjusting to ongoing disruptions and evolving demand. While we are seeing plateauing rates, it's crucial to monitor these trends closely, especially with the upcoming Golden Week in China and potential shifts in global economic conditions," said Christian Roeloffs, CEO of Container xChange.

ALCHEMPro News Desk (DP)