Market Demand Fluctuates Slightly
Most of the Shipping Routes Adjusted
The constant mutation of the Omicron strain results that the global daily new cases of the Covid-19 continue to hover at a high level as it continues to spread around the world. In China, the epidemic prevention and control situation was positive in a stable situation. There were no new cases in the territory of Shanghai. The work and production resumed on track. The overall recovery of China's economy has accelerated as economic stabilization policy measures speed up to take effect. According to the Bureau of Statistics, all three major PMI indices rose into expansionary territory in June, which further reinforced the momentum of economic recovery. This week, China's export container shipping market declined slightly, with most ocean liner market rates adjusted downwards. On July 1, the Shanghai Export Containerized Freight Index released by the Shanghai Shipping Exchange was 4,203.27 points, slightly declining 0.3% compared to the previous period.
European Routes: The ongoing conflict between Russia and Ukraine, rapid inflationary growth and higher costs of living have weakened overall demand in the European economies. This week, transport market demand declined and market rates were slightly lower. This week, the average space utilization rate of vessels in Shanghai port was at around 95%. On July 1, the market freight rate (ocean freight and ocean freight surcharge) for export from Shanghai port to European basic port was US$5,731/TEU, declining 0.6% compared with the previous period. On the Mediterranean route, the market quotation was slightly weaker than that of the European route, with the average space utilization rate of vessels at Shanghai port at around 90%, and the spot market booking price was basically unchanged. On July 1, the market freight rate (ocean freight and ocean freight surcharge) from Shanghai port to Mediterranean basic port was US$6,418/TEU, declining 0.1% compared with that in the previous period.
North American Routes: The number of cases in the US remained high due to the Omicron variant strain, domestic inflation hit a multi-decade high and price pressures led to a slowdown in consumer spending. As for demand, domestic retailers in the US have been replenishing stocks too quickly since the first quarter, with absolute stock levels already at or above the levels before epidemic, resulting in a strong wait-and-see attitude. This week, transport demand generally declined and market rates were slightly lower. On July 1, the market freight rates (ocean freight and ocean freight surcharge) for exports from Shanghai port to the basic ports in the western and eastern US were US$7,334/FEU and US$9,684/FEU respectively, declining 0.6% and 1.2% respectively compared to the previous period.
Persian Gulf Routes: The epidemic situation in destination countries was basically steady and its general situation was better compared with that in the US and Europe. The demand for transportation was generally favorable after the traditional "Ramadan" period, with a stable supply-demand relationship. Market rates have started to adjust after several consecutive weeks of upward movement. On July 1, the market freight rate (ocean freight and ocean freight surcharge) from Shanghai port to the basic port of Persian Gulf was US$3,473 /TEU, declining 1.9% compared with that in the previous period.
Australia-New Zealand Routes: Despite that the local outbreak has continued to spread, but major countries have completely lifted their precautionary measures, so the situation is uncertain going forward. During the week, transport demand was generally stable, with the average space utilization rate of vessels in Shanghai port at around 95%. The spot booking price declined slightly this week. On July 1, the market freight rate (ocean freight and ocean freight surcharge) for export from Shanghai port to Australia-New Zealand basic port was US$3,320/TEU, declining 2.3% compared with the previous period.
South American Routes: The epidemic control in the key countries of destination was generally inadequate. Transport demand is generally rising steadily, shipping lines are entering the traditional high season of two to three months, and shipping companies have a strong will to raise prices. The spot market booking prices continued to rise this week. On July 1, the market freight rate (ocean freight and ocean freight surcharge) for exports from Shanghai port to South American basic ports was US$8,384/TEU, a rise of 6.3% over the previous period.
Japan Routes: The transportation market was generally steady, with market rates declining slightly. On July 1, the freight index of China export to Japan routes was 1,184.65 points.