US lines, Southeast Asia soared

As the National Day Golden Week approaches, factories are concentrating shipments before the holiday. Combined with factors such as port congestion and shipping delays, the container transportation market continues to heat up. The latest data shows that the Shanghai Export Container Freight Index (SCFI) has risen for the sixth consecutive week, reporting 3590.05 points on September 4, an increase of 80.52 points from the previous period, and a weekly increase of 2.29%.

North American routes continue to be the main driving force for this round of freight rate increases. According to data from the Shanghai Shipping Exchange, the freight rate per FEU on the route from the Far East to the US West reached US$7,242 this week, up US$302 from the previous period, or about 4.3%; the freight rate per FEU on the route from the Far East to the US East reached US$10,324, up US$278 from the previous period, with a weekly increase of about 2.8%.

Judging from market quotations, the market reference freight rate for 40-foot containers on the US West Route in the first half of September was about US$7,500 to US$7,700, and the price for some contract customers was about US$6,000 or more; the market quotation for the US East Route was about US$11,000/FEU, and the price for contract customers was about US$9,000 or more.

The recent strength in U.S. freight rates is mainly driven by many factors: First, the National Day Golden Week is approaching, and factories have arranged shipments before the holiday in advance, which will increase market demand in the short term; second, typhoons are frequent in East Asia, port congestion and shipping delays have not been completely alleviated, and some routes have experienced ship delays, port jumps and empty flights, and the available space in the market is tight; third, the capacity of the Panama Canal is affected by water levels and other factors, further increasing the capacity pressure on the U.S. East Route.

In addition to the U.S. routes, near-ocean routes have also been affected by congestion at some ports in Asia recently. Market data shows that freight rates on Southeast Asian routes increased by 12% this week, becoming one of the routes with more obvious increases in recent times. Port congestion and unstable shipping schedules are affecting the turnover efficiency of some ships. When ships cannot return to the next voyage as planned, the actual effective transport capacity shrinks accordingly, further exacerbating the shortage of space on some routes.

In contrast to the continued rise in US routes, the recent performance of European routes is still weak. SCFI data shows that European and continental routes have been declining for many consecutive weeks, and market demand is relatively weak. In the first half of September, the market reference freight rate for 40-foot containers on European routes was approximately US$3,600 to US$4,200. Industry insiders believe that large container ships on European routes have ample shipping capacity. In the context of insufficient demand, it is more difficult for shipping companies to improve freight rates by raising prices.

It is worth noting that shipping companies have begun to prepare in advance for market changes after the Golden Week holiday. As shipment demand is gradually released before the holidays, it is expected that demand on some routes may fall from late September to early October. In order to avoid a rapid decline in freight rates after the holiday, many shipping companies have planned to adjust shipping capacity through empty flights, port hopping and other methods to control the market's effective shipping capacity.

Overall, SCFI has achieved six consecutive increases, and North American routes are still the main force driving the index's rise. As the Golden Week approaches, changes in market demand after the end of the pre-holiday shipping peak, port congestion, and subsequent shipping company capacity adjustments will jointly affect the freight rate trend in the next stage.