China rates climb slows

FREIGHT rates on Australia’s premier trade route from China have slowed their recent rapid rise but are continuing to climb just the same.

The SCFI (mean spot rate) for Shanghai-Sydney for Week 20 stands at USD 2,412/FEU, up 3% on the previous week which, however, had jumped 9% over Week 18. The rates have been marching steadily since Week 13, when the level was just USD 1,242/FEU.

DCN sources say the increased rates appear to be holding, and Chinese forwarder quotes, valid to at least mid-May, show USD 2300-2600/FEU from Qingdao, similar spreads from Shanghai and Ningbo, 2300-2700 from Shenzhen and Nansha, and 2300-2600 from Tianjin, all to East Coast ports. According to this particular forwarder Maersk is the most competitive.

The rates are being supported by voyage blankings, with CAT blanking Weeks 23 and 30, CA2 sailing only five weeks in six following the withdrawal of SeaLead while also blanking Week 33. NAX/NEAX is blanking Weeks 20 and 27. MSC’s Panda has a structural blank one week in eight, and Kangaroo has reduced to fortnightly, although major changes to MSC’s Oceania services will be announced imminently. A3N has one blank.

Meanwhile, the Xeneta index for South East Asia to Ausralian main ports remains stubbornly stable, this week showing USD 1,611/FEU, unchanged from week 19 and basically within 1-2% for over six weeks.

Nevertheless, carriers are continuing to try for general rate increases (GRIs) and rate restorations in the SEA trade.

Since our last review, ANL has announced a rate restoration program from 15 May at USD200 per 20’ dry & USD400 per 40’ dry for all shipment from Asia/Indian Subcontinent/Middle East to New Zealand, and a further identical rise on 1 June.

Also on 1 June, ANL will apply a rate restoration of USD300 per 20’ dry/reefer & USD600 per 40’ dry/reefer for all shipment from Asia to Australia. This increase will apply on top of current Spot/FAK rates subject to all applicable surcharges valid on time of shipment.

On 15 May, COSCO Shipping will impose a rate restoration from South East Asia to all ports and points in Australia of USD 300/TEU, USD 600/FEU, and from Asia to Australia similarly.

Taking a slightly different tack, on 15 May MSC will introduce a peak season surcharge (PSS) of USD 200/TEU on all cargo moving from China, Hong Kong, Taiwan, Japan, Korea, Cambodia, Thailand, Vietnam, Malaysia, Myanmar, Singapore, Philippines and Indonesia to Australia and New Zealand.

Hapag-Lloyd has introduced an emergency operation charge.

“Recently, there has been an increase in operational costs in certain areas of our network that use feeder services. These cost increases are driven by rising fuel expenses, which have significantly impacted the cost of operating these services,” the carrier said. “To address these challenges and to maintain the quality and reliability of our service offering, we will introduce an Emergency Operation Charge. This measure will be implemented regionally and is intended to support the recovery of the increased operational costs. Please note that this charge may apply to shipments where the origin and/or destination is served via a feeder service.”

On Monday [11 May] the line announced applicability in Asia and Oceania.

CMA CGM has announced a 1 June PSS for both the NEMO and PAD services, and relay services via Asia, covering shipments from North Europe, Poland, Scandinavia, Baltic, East & West Mediterranean, Adriatic, Black Sea & North Africa to Australia and New Zealand: USD 350 per TEU on direct services to Australia; USD 200 per TEU on relay services via Asia to Australia and USD 200 per TEU to New Zealand, applicable on all contracts up to three months validity.