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13 October, 2021 Industry News

Shipping Rates Ease Across the Global Market

Shipping Rates Ease Across the Global Market

Read about what's happening in the shipping industry!

For the last few weeks, the shipping situation has softened with prices slightly decreasing on average. Despite rates that are still significantly elevated compared to pre-pandemic prices, Bloomberg reported that this week, one of the busiest routes, Shanghai to Los Angeles saw the price for a container drop $1,000, an 8.2% decrease. According to the Bloomberg article, some analysts believe that this reduction in price could be attributed to slower production in China during its Golden Week holiday, as well as the energy crisis and power shortages being experienced in parts of the country.

Looking at rates for other routes, the Drewry’s World Container Index showed that this past week the overall index decreased 2.2% to $10,129.72 per 40-foot container. However, this is still 289% higher than the same week in 2020. The rate for Los Angeles to Shanghai dropped 5%, and the Rotterdam to Shanghai rate decreased 2%. On the contrary, the prices for Shanghai to Rotterdam slightly increased, by 2%.

Apart from the elevated prices, the shipping industry is also battling reduced operations, as the impending typhoon, Kompasu, has forced Chinese authorities to close at least three ports as of Tuesday, October 12, in Hainan, as well as Shenzhen’s Yantian port, which is one of the world’s busiest container ports. It still remains unclear when operations would resume.

Furthermore, the shipping logjam in ports such as Los Angeles and Long Beach continues to be of concern. According to Bloomberg, 60 ships were waiting outside of these Californian ports for a berth to offload as of Sunday evening. The average wait time has now increased to more than 11 days, higher than the previous high of 8 days recorded back in April.
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