Container freight rates, which have increased for eight consecutive weeks, were put on a comma in the statistical cycle on September 24: SCFI reported 3,686.62 points, a slight decrease of 0.03%, ending eight consecutive increases. However, the "stop in growth" of the composite index conceals more important structural signals--The divergence between the U.S. and European lines has entered its seventh week, and the direction is completely opposite.For factories, how to ship goods in the fourth quarter depends on which route you are on, not whether the composite index rises or falls.
1. The latest reading: high consolidation, not trend reversal
Put the four indices in the latest issue together: SCFI reported 3,686.62 points (-0.03%), CCFI reported 1,917.68 points (+1.1%), Ningbo Export Container Freight Index (NCFI) reported 2,494.75 points (-1.6%), and Drewry WCI reported 4468 US dollars/FEU (-1%). The four indices rose and fell twice, with fluctuations on the order of 1%-this is a routine consolidation after eight consecutive weeks of gains, not a signal that the market is cooling. SCFI is still at a high level compared with the same period last year, reflecting the real tight supply and demand.
2. The U.S. line and the European line are moving in two markets
The invisible differentiation of the composite index is very clear in the route-level data. The NYSHEX index showed that the Asia-U.S. West immediate price rose 4.82% to US$7,417.32, the Asia-U.S. East rose 5.75% to US$9,692.72; while the Asia-Northern Europe fell 4.13% to US$3,597.33. Drewry went in the same direction: Shanghai-Los Angeles rose 2% to US$7838/FEU, and Shanghai-Rotterdam fell 4% to US$3485.
The reasons why the two routes rise and fall are completely different. The support for the U.S. line comes from both ends: First, factories rushed to concentrate shipments before the National Day Golden Week (October 1 - 8), and the cargo volume surged in the short term; second, shipping companies used empty flights and slow-down voyages to lock up the cargo spaces. Drewry expects to cancel about 77 voyages on the east-west main route from mid-September to mid-October, with a cancellation rate of about 11%, of which trans-Pacific is the focus. The opposite is true for the European route: European demand has been weak throughout the season, and the number of weekly transit ships in the Suez Canal has rebounded from 41 to 48. Ship returns have added effective capacity back to a route where supply exceeds demand.
3. The action list of the shipping company before and after the Golden Week
To understand the post-holiday market, first look at what the shipping company is doing: during the Golden Week period, the factory stopped production for one week, and the shipping company simultaneously stopped shipping to "align" the cargo volume; in the first week of resumption of work after the holiday, the backlog of orders and cargo that had not been caught up before the holiday were released, and the cargo space became tense again. Statistics from industry organizations Xeneta and eeSea show that the proportion of empty flights announced on the east-west main routes in October is about 13%, which is lower than 24% in the same period in 2023. This shows that the shipping company has not aggressively reduced its cabin this time, and the post-holiday cabin will not be as intense as the previous two years, but the rush for cabin on the US line will still be the norm.
Drewry also predicts that after the Golden Week effect fades, trans-Pacific freight rates are expected to fall back in the next reading-if cargo owners do not have a rigid delivery period, booking in the second and third weeks after the holiday may be cheaper than before the holiday.
Suggestions on the delivery rhythm in the fourth and fourth quarters
| cargo type | Suggested rhythm | reason |
|---|---|---|
| U.S. line rigid delivery orders (Christmas season replenishment) | Book in early October and lock in direct ships | There are concentrated empty flights and tight spaces, and late bookings face cabin turnover and PSS peak season surcharge |
| The US line can negotiate delivery orders | Postponed until mid-to-late October | Drewry expects U.S. freight rates to fall after the holiday and may save a sum of freight two weeks later. |
| European line orders | Just schedule your production normally and book your cabin at a price comparison | European line capacity has resumed and freight rates have fallen. Shipping companies have room to make concessions and can negotiate long-term contracts or batch prices. |
| High-value urgent order | Air or sea-rail combined transport options | Air freight spot prices increased by about 33% year-on-year, but shipping space fluctuated greatly around the Golden Week, and urgent orders were locked first. |
There is another one that is easy to ignore: freight rate differentiation means that the average comprehensive freight rate has lost its reference significance. When reviewing prices with freight forwarders, it must be confirmed separately by route and by shipping schedule. Don't use coarse grains such as "market prices have increased/fallen." Judge and sign a monthly agreement.
5. Three practical principles for looking at freight rates
- Look at the route first, then look at the synthesis.SCFI and WCI are both weighted composite values, and the real supply and demand of a single route can no longer be reflected in this round of differentiated market. When you get the quotation, you must first divide it and compare it according to routes such as Shanghai-Los Angeles and Shanghai-Rotterdam before making a decision.
- Spot and settlement prices should be viewed separately.SCFI is partial to spot and CCFI is partial to settlement. CCFI is still rising by 1.1% in this period while SCFI has stopped rising, indicating that goods booked in the early stage are being shipped at a higher settlement price. To judge "whether the freight rate has really dropped", the spot criterion shall be used, and the settlement criterion shall be used to calculate the profit of orders on hand.
- Ask two shipping companies for the same route.In the divided market, the difference in investment by shipping companies on routes is amplified: some shipping companies add ships on the U.S. line, and some grab shares on the European line. The difference in prices between different shipping companies on the same route can reach more than 15%. Get price comparisons from at least two shipping companies before locking the cabin during the peak season.
Apply these three principles in the fourth quarter: update freight rate expectations at the beginning of each month against the latest index, and the freight column of the quotation system is changed accordingly; long-term contract customers communicate the freight rate adjustment mechanism in advance; short-delivery orders leave a buffer for freight fluctuations. During periods of high fluctuations in freight rates, logistics cost management capabilities are itself part of competitiveness.
common problems
1. SCFI has ended eight consecutive increases. Should we wait for freight rates to fall again before shipping??
It depends on the route. Due to empty flights and post-holiday rush, there is limited room for short-term decline on the U.S. line. When freight rates wait for them to pay extra surcharge during the peak season; while the capacity of the European line continues to recover, freight rates still have room for downward decline, and goods that are not urgent can be shipped in batches. It is easy to go in the opposite direction to "wait for a fall" or "grab out" in general terms.
2. Shipping companies will be suspended during the Golden Week. Will it be as difficult to find a cabin after the holiday as in previous years??
The proportion of empty flights this year is about 13%, which is lower than the 24% in 2023. Shipping companies have not cut shipping spaces to extreme levels. The U.S. line will still be tight in the first week after the holiday, but it will gradually ease from the second week. It is safe to book the cabin for the first two weeks after the holiday before returning to work, rather than waiting for the cabin after returning to work.
3. What impact does freight rate differentiation have on signing annual logistics agreements??
The averaged package price is easily distorted in a differentiated market: some shipping companies on the US line will charge PSS, while there is room for bargaining on the European line. The annual agreement recommends splitting pricing based on routes, and stipulates trigger conditions and upper limits for surcharges during peak seasons to avoid passively accepting price increases during peak seasons.
--Qihang AI Foreign Trade Research Institute·Let China Intelligent Manufacturing Set sail to the sea| Foreign trade customer consultation: 180-0327-6609
