Weekly Supply Chain Update: 9

Baltic Exchange Sea Freight Index Hits 1.5-Month High Amid Strong Capesize Demand

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The Baltic Exchange’s main sea freight index rose to its highest level in one and a half months on Thursday, driven by strong demand for capesize vessels. The overall index, including rates for capesize, panamax, and supramax vessels, increased by 67 points (3.4%) to 2,031, the highest since May 13. The capesize index jumped 226 points (7.2%) to 3,371, the highest since May 9, with average daily earnings up $1,872 to $27,954. Iron ore futures rose on China's efforts to boost its property market. The panamax index dropped 11 points (0.7%) to 1,672, the lowest since April 10, with average daily earnings down $102 to $15,047. The supramax index fell 13 points (0.9%) to 1,399, ending a 13-session winning streak.

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WCI Spot Rates Continue to Climb with Significant Increases in Key Headhaul Trades

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This week's WCI spot rate data from Drewry indicates a continued rise in key headhaul trade rates. Asia-North Europe experienced the largest weekly increase, with rates rising by $455/FFE to over $7,300/FFE. Mediterranean rates saw a smaller increase, marking the first time since September 2022 that North Europe spot rates have surpassed Mediterranean rates. Looking ahead, MSC has announced FAK rates of $9,800/FFE to North Europe and $7,900-$9,000/FFE to the Mediterranean and Black Sea starting next week. In the Pacific, rates to both coasts increased, with USEC rates rising slightly more than USWC. East Coast rates now exceed $7,800/FFE, while West Coast rates are nearly $6,700/FFE. Most major carriers have announced an additional PSS of $2,000 effective next week.

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MSC Revises Equipment Repositioning Charges for Türkiye-Origin Cargo

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Due to the current equipment situation in Türkiye, MSC will revise its Equipment Repositioning Charge (ERC) for all cargo originating from Türkiye to NWC, UK, and ScanBaltic destinations. Effective from 1 July 2024 (B/L date) until further notice, the ERC will be charged as follows: €500, £500, or $500 per 20' container and €500, £500, or $500 per 40' container.

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Maersk Unveils Comprehensive Overview of 72 Peak Season Surcharges

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Maersk has released a single-page overview detailing their various Peak Season Surcharges. There are 72 different surcharges, each applicable to specific trade lanes and validities, ranging from $200/FFE to $5000/FFE. See link below:

• https://www.maersk.com/news/articles/2024/06/27/peak-season-surcharge-consolidated-view

Container Prices in China Surge to Two-Year High Amid Rapid Increase in Leasing Charges

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The average container prices in China have reached their highest in two years, at US$3,600 this week for 40 ft high cube cargo-worthy containers in China. These prices were somewhere around US$1,700 in March – April 2024. This is a 112% increase in a span of two months. Note: The average container prices as recorded from customer interactions are yet to be reflected in the chart above. According to the chart, it shows the average prices at $3,250 as of 24 June 2024. While the average container prices (for purchasing containers) are on a significantly upward trend, the average one-way pick-up charges (for leasing containers) continue to develop at a staggering rate so far in June. The average lease charges ex Shanghai to Rotterdam were somewhere around US$500 in November 2023 which are now 3X, somewhere around US$1,700, to Hamburg is US$2,030 and to Antwerp is US$1,888.