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Head shipping companies warn: bulk sea freight will continue to go higher

Head shipping companies warn: bulk sea freight will continue to go higher

Kyrie Sunny 2021-09-18 18:36:38
With the gradual control of the epidemic and the global economic recovery, the fast-growing demand for shipping transport far exceeds the current level of supply chain logistics can carry, driving up shipping costs. U.S. dry bulk shipping company Genco Shipping President and CEO John Wobensmith, due to limited ship capacity and strong demand, bulk shipping capacity is tight, bulk shipping costs are expected to continue to move higher. Capesize bulk carrier freight rates on Monday had hit the largest single-day increase in 2008, the average daily rate of nearly $ 53,000 per ship. Drewry Shipping data show that spot freight rates for manufactured goods have soared for 20 consecutive weeks and are 731 percent higher than the seasonal level average of the past five years. Wobensmith said demand is growing rapidly and far outpacing supply. Freight agreements in the first quarter were above $20,000, a seasonal level not seen in a decade. He continued that freight rates have risen sharply this year and a similar cycle is likely to occur in the next few years, given the limited number of ships and the difficulty in meeting freight demand. In addition, bulk carriers are still in short supply, and since shipyard orders are mostly for container ships, Wobensmith expects bulk carrier supply to remain low for the next few years. Bulk shipping rates have risen strongly in recent months, Wobensmith said, bulk freight rates may appear "parabolic growth". When utilization rates reach a certain level, rates will begin to move parabolic, and we are approaching that state. Each year, more than 5 billion tons of commodities such as coal, steel and grain are shipped around the world by bulk carrier. The higher Baltic Dry Index (BDI) indicates increased demand for commodities on major routes. Top shipping companies warn: bulk shipping rates will continue to rise    Wobensmith expects a major reversal in bulk carrier rates until early next year. He believes that only when demand growth slows, the soaring rise in freight prices is expected to decline. In addition, the world\'s largest container shipping transport group Maersk believes that shipping market conditions this year and no signs of cooling. Despite previous statements by Maersk and other head shipping carriers collectively that freight rates will not increase, but warehouses and containers are in short supply, and supply is always in short supply. Commodity transportation costs are high and prices are under pressure, adding to inflation. However, Wobensmith expects the situation to stabilize early next year as seasonal demand slips.