Some ocean carriers pulled their 1 November General Rate Increases (GRIs), but, with sailings heavily booked, further rounds of GRIs are expected on 15 November and 1 December. Depending on the outcome of the US and Chinese President’s upcoming negotiations, there may be more trade tariffs to come, and therefore no let-up in high transpacific pricing.
There’s a reason why China-West Coast prices have been at 18-month highs for 13 straight weeks. It’s not just that it’s peak season – they have been largely spurred by advance shipments before each successive tranche of China trade tariffs takes effect. Right now, people are trying to beat the 1 January tariff increase. If President Trump holds good on his threat to slap a tariff on the remaining $257 billion worth of imports should his meetings with President Xi at G-20 fail to break the deadlock, then expect transpacific prices to remain strong in January ahead of yet another tariff hike.” – Zvi Schreiber, CEO, Freightos
This week’s report
|Week 44||Week 43||Last year*|
|China – US West Coast||$2,557||1%||69%|
|China – US East Coast||$3,496||6%||65%|
|China – North Europe||$1,525||6%||3%|
|North Europe – US East Coast||$1,789||-2%||29%|
|* Compared to the corresponding week in 2017|
Transpacific pricing continued an extended run of 18-month highs. China-West Coast prices were above the $2,000 mark for the 13th week in a row (the last time it breached this mark was the week before Chinese New Year in 2017). Similarly, the China-East Coast prices breached the $3,000 mark for the 14th straight week.
Peak season alone can’t explain these high prices, as proven last year, when prices actually fell through peak season. The main reason is that many shippers are trying to stock up before the latest tranche of China trade tariffs increases from 10% to 25% on 1 January. This means that prices are likely to stay high well into mid-December.
If President Trump holds good on his threat to slap a tariff on all of the remaining $257 billion worth of imports after his G-20 meeting with President Xi (late November), then expect transpacific prices to stay high until well after Chinese New Year.
The Freightos Baltic Indices reflect weekly spot rates for 40-foot containers based on 12 to 18 million price points collected every week on 12 main shipping trade lanes. The data includes a headline index – the FBX Global Container Index (FBX) – a weighted average of the 12 underlying route indexes. This data is published every Sunday. See www.balticexchange.com/market-information/containers/