- The Asia to North Europe spot freight rates stood at US$10,544 per FEU on June 8, 2021 and are expected to rise even further
- Spot rates have averaged $8,224 per FEU, towering above the $1,489-$2,187 per FEU average spot rates annually between 2017 and 2020
- Long-term contract rates have also risen to record high levels, with carriers locking in long-term contracts at $3,836 per FEU
- The high demand for container shipping has meant more cargoes being rolled over and shippers finding it harder than ever to secure a spot for their boxes on the desired sailing
Even as trans-Pacific freight rates have been smashing records, Far East to North Europe prices have also been reaching new highs, but the bigger worry for shippers is not even the soaring rates but securing a place on fully booked ships, according to a Baltic and International Maritime Council (BIMCO) report.
Spot freight rates from Asia to North Europe have breached the US$10,000 per forty-foot equivalent unit (FEU) mark for the first time ever, standing at $10,544 per FEU on June 8, 2021, based on figures from freight rate benchmarking and research company Xeneta, BIMCO said in a new report.
What’s more, the rates are expected to rise even further when mid-month general rate increases (GRIs) are announced this week, noted BIMCO, the world’s largest trade organization of shipowners.
READ: Container rates up 34.5% since start of 2021-report
So far this year, Far East to North Europe freight rates have averaged $8,224 per FEU, towering above the $1,489 to $2,187 per FEU that spot rates averaged on an annual basis between 2017 and 2020.
This is despite volumes on this trade being up by only 1.0% in the first four months of 2021 compared to pre-pandemic 2019, an increase of just under 60,000 TEUs. The wider supply chain crunch, as well as the global pressure on container shipping, equipment shortages and disruptions such as the blockage of the Suez Canal and COVID-19 disruption at major Chinese ports, is behind the moderate increase.
Long-term contract rates have also risen to record levels, with carriers locking in long- term contracts at $3,836 per FEU.
Despite having to pay record high freight rates, the bigger worry for shippers is reliability, said BIMCO analyst Peter Sand.
“The high demand for container shipping this year has meant more cargoes being rolled over and shippers finding it harder than ever to secure a spot for their box(es) on the desired sailing. While the shippers that are most valuable to carriers are escaping from these record high freight rates, others are paying thousands of dollars in surcharges, and even this is often not enough to secure space on already fully booked ships,” he said.
Photo by Dirtsc
