Ocean Cargo: Spot pricing escalates in Asia-U.S. trade lane

Spot prices for transpacific shipping services have grown by more than 180 percent during the past 12 months to reach a five-year high. Experts describe the increase as a “mini container shipping boom.”

Shipping consultant Drewry’s Hong Kong-Los Angeles container rate benchmark hit $2,607 per 40-ft (FEU) container last week – 19 percent higher than the previous week and 182 percent higher than the same week in 2009.

But Drewry pointed out that the trade had been suffering with “serious overcapacity and price discounting” in 2009.

It added that the jump in transpacific container rates reflected new peak season surcharges, very tight eastbound transpacific ship capacity and a shortage of boxes, which is becoming an issue in China as well as in the US.

Drewry said eastbound transpacific freight rates, under annual contracts signed in May and June for the 2010/2011 season were also more than twice the previous low levels of the 2009-10 season.

“The rebound in spot container freight rates has been phenomenal, as rates now substantially exceed pre-crisis levels of about $2,000 per 40-foot box,” said Philip Damas, dditor of the Drewry Container Freight Rate Insight report, which contains the data.

“Whether you look at Hong Kong-to-Los Angeles, Shanghai-to-LA, Shanghai-to-New York or Shanghai-to-Chicago, all our weekly container rate benchmarks from port to port or from port to inland point show year-on-year increases of more than 60 percent.

“It is a mini container shipping boom, ahead of the full recovery of the real economy,” he added.