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.

By ·

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.


About the Author

Patrick Burnson, Executive Editor
Patrick Burnson is executive editor for Logistics Management and Supply Chain Management Review magazines and web sites. Patrick is a widely-published writer and editor who has spent most of his career covering international trade, global logistics, and supply chain management. He lives and works in San Francisco, providing readers with a Pacific Rim perspective on industry trends and forecasts. You can reach him directly at [email protected]

Subscribe to Logistics Management Magazine!

Subscribe today. It's FREE!
Get timely insider information that you can use to better manage your entire logistics operation.
Start your FREE subscription today!

Article Topics

Ocean Freight · Shipping · All Topics
Latest Whitepaper
Is Your Logistics Strategy Keeping Pace with Your Manufacturing Efficiency?
U.S. manufacturers continue to invest in world-class technology and innovation, as a growing number of businesses choose to expand U.S.-based production — or return manufacturing from Asia.
Download Today!
From the April 2017 Issue
While adoption rates have remained relatively flat, yard management systems (YMS) are helping logistics operations turn that important space between the loading dock and the gate into a vital link in the supply chain.
Information Management: Wearables come in for a refit
2017 Air Cargo Roundtable: Positive Outlook Driven by New Demand
View More From this Issue
Subscribe to Our Email Newsletter
Sign up today to receive our FREE, weekly email newsletter!
Latest Webcast
Maximize Your LTL Driver Adherence with Real-time Feedback
This webinar shows how companies are using real-time performance data to optimize the scheduling of their city fleets, as well as the routing of their standard, accelerated and time-critical shipments.
Register Today!
EDITORS' PICKS
2017 Salary Survey: Fresh Voices Express Optimism
Our “33rd Annual Salary Survey” reflects more diversity entering the logistics management...
LM Exclusive: Major Modes Join E-commerce Mix
While last mile carriers receive much of the attention, the traditional modal heavyweights are in...

ASEAN Logistics: Building Collectively
While most of the world withdraws inward, Southeast Asia is practicing effective cooperation between...
2017 Rate Outlook: Will the pieces fall into place?
Trade and transport analysts see a turnaround in last year’s negative market outlook, but as...