International ocean freight rates have begun to decline, with freight rates on some popular routes plummeting by more than 50%, due to the drop in freight demand and the recovery of smooth logistics. Industry insiders said that the super cycle of ocean shipping has ended, and the decline in freight rates will accelerate in the second half of the year.
According to the China Securities Journal, Chen He, a sales manager of a foreign trade company in Nanjing, said: “Last year, the epidemic had a serious impact, and there were many shopping rushes overseas. Major retail supermarkets also stepped up stocking, resulting in a backlog of inventory. This year’s new orders fell by an average of 30%. %-60%.”
Data shows that as of May 8, Costco’s inventory was as high as $17.623 billion, an increase of 26% over the same period last year, and hundreds of millions of dollars of goods were inventories in the peak consumer season last year. In addition, Macy’s stock was up 17% from last year, and stock at Walmart fulfillment centers surged 32%.
Feng Jin, a shipping agent in Ningbo, said, “U.S. cargo owners usually stock up in July-August. Due to the previous increase in freight rates and uncertain factors such as the epidemic, many cargo owners have advanced the stocking time to May, which has also led to the recent increase in freight rates. Freight demand is down.”
In addition, the logistics supply chain is gradually restored to smooth flow. Feng Jin said: “Because of the epidemic, workers stopped work before, the cargo at the terminal was piled up, and the containers might not come back, but the situation has improved significantly recently, and the logistics turnover speed has accelerated significantly. Previously, it was necessary to book space 1-2 months in advance. Since June Just a week in advance.”
Industry insiders believe that the super cycle of ocean shipping has ended, and the freight rate will decline rapidly in the second half of the year. The growth of global container transportation demand will drop to 4% and 3% this year and next, respectively, which is not as good as last year’s 7%.
The FBX index released by the Baltic Shipping Exchange shows that on June 29, the average FBX container shipping price was US$6,583, a sharp drop of 40.9% from the historical high in September last year, of which the freight rate of the China/Far East-North America West Coast route was the highest compared with last year. The freight rate dropped by 63.1%, and the freight rate of the China/Far East-North America East Coast route plummeted by 54.6% from the highest freight rate last year.