Drewry's World Container Index up 16%, Red Sea crisis raises freight

Continued attacks in the Red Sea region by Houthi rebels were the main reason for the spike in freight, according to media reports. Continued attacks have forced carriers to reroute ships through the African Cape of Good Hope. Such disruptions have not only delayed shipments but also increased freight charges. There are limited ships available for new consignments.

The latest Drewry WCI composite index of $3,159 per 40ft container is 122 per cent higher than the average 2019 (pre-pandemic) rates of $1,420.

According to the latest container freight index by Drewry, the average composite index for the year to date is $3,227 per 40ft container, which is $512 higher than the 10-year average rate of $2,714 (inflated by the exceptional 2020-22 COVID period).

Freight rates from Shanghai to Rotterdam have increased by 20 per cent or $606 per 40ft container. Similarly, rates from Shanghai to Los Angeles surged by 18 per cent or $617 per FEU. Likewise, rates from Shanghai to Genoa and Shanghai to New York spiked by 16 per cent. Moreover, rates from New York to Rotterdam inched up by 1 per cent or $4 per container.

Conversely, rates from Rotterdam to New York decreased by 2 per cent or $50 per 40ft box. Similarly, rates from Rotterdam to Shanghai declined by 6 per cent or $44 per FEU. Rates from Los Angeles to Shanghai remain stable.

Drewry expects freight rates ex-China to continue increasing in the upcoming week amid a huge demand spike and tight capacity.

This week, the noted freight rates were as follows: Shanghai to Rotterdam $3,709 (up 20 per cent), Rotterdam to Shanghai $695 (down 6 per cent), Shanghai to Genoa $4,295 (up 16 per cent), Shanghai to Los Angeles $3,988 (up 18 per cent), Los Angeles to Shanghai $699 (no change), Shanghai to New York $5,089 (up 16 per cent), New York to Rotterdam $629 (up 1 per cent), and Rotterdam to New York $2,160 (down 2 per cent).

ALCHEMPro News Desk (KUL)