Ocean Shipping Rates Surge Ov...

Ocean Shipping Rates Surge Over 50% in Major Trade Lanes, Reveals Freightos Data

Jan 08, 2024
Ocean Shipping Rates Surge Over 50% in Major Trade Lanes, Reveals Freightos Data

(Image Source: Andy Li, Unsplash)

In the wake of ongoing Houthi attacks on commercial vessels in the Red Sea, ocean shipping rates have witnessed a dramatic spike, escalating by more than 50% in crucial trade routes. The increased maritime risks and diversions away from the Red Sea have triggered significant impacts on global shipping rates.

Key developments in various trade lanes include:

  • Asia-US West Coast prices (FBX01): Soared by 63% to $2,713/FEU

  • Asia-US East Coast prices (FBX03): Climbed 55% to $3,900/FEU

  • Asia-N. Europe prices (FBX11): Surged by 151% to $4,042/FEU

  • Asia-Mediterranean prices (FBX13): Rose by 108% to $5,175/FEU

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Amidst the Red Sea disruptions and heightened tensions, carriers are rerouting vessels, resulting in longer voyages, extended lead times for importers, and potential port congestion concerns. Notably, Maersk has suspended all Red Sea transits until further notice following a recent attempted hijacking.

The repercussions extend to elevated ocean rates:

  • Asia – N. Europe rates: Skyrocketed by 173% to over $4,000/FEU.

  • Asia – Mediterranean prices: Doubled to surpass $5,000/FEU.

Carriers have also announced surcharges ranging from $500 to as much as $2,700 per container, further intensifying the financial impact on shippers.

In the air cargo realm, the delays in ocean freight are anticipated to lead to a potential shift of more urgent volumes to sea-air services or air cargo alternatives. However, as of now, there haven't been significant reports of air cargo disruptions.

While these heightened rates present challenges, they remain notably lower than the peaks experienced during the pandemic years. Even at $5,000 – $8,000/FEU, Asia – N. Europe and Mediterranean prices are considerably lower than the peaks reached in late 2021 and 2022, providing a perspective on the industry's current landscape.

Source: January 3, 2024 Update

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