Freight rates down on major trades due to Slowing Exports

  • August 16, 2022
  • News

The latest market analysis by Container News states that with export volumes falling, average container freight rates on major trade routes from India have seen a measurable downward revision this month, compared to levels seen by reputed carriers in July.
On Westbound traffic between India and Europe, fares from West India [Jawaharlal Nehru Port (JNPT) / Nhava Sheva or Mundra Port] to Felixstowe / London Gateway (UK) drop to $4700/TEU and $5,200/FEU from $5,250 and $5,950, respectively last month.
For shipments from the Western part of India to Rotterdam, average freight rates dropped by double digits, as low as $ 4,650/TEU and $5,200/FEU from $5,250 to $5,750, respectively. Rates continue to fall for eastbound trade continuing into August, currently settling at around $1,750/TEU and $1,900/FEU, compared with $1,850 and $1,950 from Felixstowe/Rotterdam shipments to Nhava Sheva or Mundra.
After rates being steady for the past few months, contract freight rates from India to US East/West Coast have also fallen from July levels – averaging $7,950/TEU from $8,350 and $10,000/FEU, compared to $10,500, for bookings to the US East Coast (New York), and at $8,350/TEU from $10,250 and $10,600/FEU, from $12,850, for shipment to US West Coast.

However, for trade between West India and the US Gulf Coast, the rates have moved further up, from $9,150 and $11,500 to $10,250/TEU and $13,000/FEU, respectively.

In the return leg, average fares remained stable with prices maintained by major carriers in the previous month – US $1075 / TEU and US$ 1 450 / FEU from USEC; at $2,500/TEU and $3,200/FEU from USWC; and $1,800/TEU and $1,850/FEU container from Gulf Coast to West India (Nhava Sheva/Mundra).

For India/Inner Asia/Far East trade, demand remains strong and such rates have increased further this month compared to the July trend, boosted by China’s trade recovery after being restricted.

For cargo loads from West India to South China (Yantian), current average rates are at US$600/TEU and US$925/FEU, up from US$550 and US$850, respectively, a month earlier.

For shipments from West India to South China (Yantian), average rates are currently $600/TEU and $925/FEU, increased from $550 and $850 respectively.

For West India-Central China (Shanghai), carriers are accepting bookings at about $550/20-foot container and $850/40-foot container, compared with US$500 and US$750 in July, on average, according to the data analysis.

“The shipping lines have been consistently repositioning empty containers into the country at a huge cost and increasing their capacities to help the Indian export trade,” said Sunil Vaswani, executive director of the Container Shipping Lines Association (CSLA) to Container News.

According to data analysts Mr. Sunil Vaswani, the West India and China (Shanghai), liners are accepting reservations for around $550/20ft container and $850/ ft. container, compared to averages of $500 and $750 in July, at an average. He added that the shipping lines had been regularly repositioning empty containers into the country at a great expense and at an increased capacity to aid Indian export trade. In 2021, 1.85 million TEUs of empty containers were repositioned domestically and new services were introduced, bringing capacity to about 35,000 TEUs per week. These efforts have also continued this year, contributing to the easing of interest rates.