Weekly Commentary on China Containerized Transportation

Liu+Zijia

In the week ending May 29， China export box market sees transport demand stable. Capacity is expanded in many services， leaving demand/supply condition unimproved， and the whole market weak. On May 29， China （Export） Containerized Freight Index issued（CCFI） by Shanghai Shipping Exchange （SSE） quotes 890.42 points， falling slightly by 0.1% from one week ago; while Shanghai （Export） Containerized Freight Index issued（SCFI） by SSE slides by 2.1% from last week to 661.55 points.

In the Europe service， despite the traditional peak season coming in late May as usual， transport demand increases not as much as that last year. As more mega vessels are put into service in May， the oversupply of capacity is worsened， causing the average slot utilization rate hovering at around 85%. Booking rate in most services fall， and some even quoted below USD200 per TEU. On May 29， freight rate in the Shanghai to Europe and Mediterranean services （covering seaborne surcharges） quote USD 342 per TEU and USD466 per TEU， diving by 23.0% and 19.8% from one week ago respectively， both making a new low record.

In the North America service， U.S. economy has a stable increase， spurring transport demand. In the USWC service， as the gradual recovery operation of ports， cargo volume rises， with the average slot utilization rate above 90%; in the USEC service， transport demand raises firmly. Although impacted by the input of mega vessels previously， demand/supply unbalanced condition deteriorates， leading that the average slot utilization rate in the USEC service about 90%， with some even approaching 95%. Part of box liners tries to implement this round of fright rate increase plan; consequently， freight rate in the USWC service has a large rebound， and more than that in the USWC service. On May 29， freight rate in the services from Shanghai to USWC and USEC （covering seaborne surcharges） quote USD1526 and USD3216 per FEU， arising by 8.1% and 2.4% from one week respectively.

As the approach of Ramadan in the Persian Gulf/Red Sea service， domestic plants speed up shipment， boosting cargo volume increasing stably. However， as excess services are provided， demand/supply condition has no remarkable improvement， with spot rate downward. On May 29， freight index in the China- Persian Gulf/Red Sea service has a week-on-week decrease of 1.2% to 886.95 points.

In the South America service， unbalanced demand/supply condition is worsened. In the East Coast of this service， impacted that core economy like Brazil may traps on the weak condition， residence consumption demand is hit， with slot utilization rate falling to be 80% around， spot rate slip unilaterally， and some even quoting USD300 per TEU; in the West coast of this service， since more capacity is put into service， demand/supply condition keeps deteriorating， with the average slot utilization rate below 80%， spot rate hovering between USD 200-300 per TEU. On May 29， freight index in the China-South America service dived by 6.8% week-on-week to 535.85 points.

（Please contact the Information Dept of SSE for more details.）endprint