The rate decline on Asia to Europe services slowed this week on the Shanghai Containerised Freight Index (SCFI) as the market braced for coming rate increases, according to Shipping Gazette.
This week's index revealed that spot rates on services from Shanghai to northern Europe declined by US$45 to $843 per TEU compared with a week earlier. Meanwhile, prices from Shanghai to the Mediterranean slipped $45 week on week to $893 per TEU.
Rates are also behind last year's levels, when the SCFI reported rates to northern Europe of $1,253 per TEU and the Mediterranean of $1,213 per TEU, boosted by a mid-March rate increase.
Freight Investor Services analyst Richard Ward said the slower decline reflected the carriers' general rate increases, which they "hope will offset at least some of the $922 decline witnessed over the past 11 weeks".
Mr Ward said overcapacity-linked rate declines also afflicted the east coast of South America where rates are an all-time low of $624 per TEU.
Said Mr Ward: "Cascading are no doubt played a part in this rate erosion as carriers introduce ever larger vessels into already oversupplied routes. This trend will only continue with the current fleet over 10,000 TEU expected to increase 25 per cent this year, followed by a further 30 per cent in 2015."
While Asia-Europe prices continued to decline this week, there was a divergence in transpacific spot rate trends.
Rates from Asia to the US west coast also fell $66 against the week before to $1,856 per FEU, reported Lloyd's List, but rates to the east coast enjoyed a slight increase of $6 to $3,293 per FEU. This follows last week's increase on services to both coasts from Transpacific Stabilisation Agreement (TSA) rate hike of $300 per FEU.
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