The freight index rises again! The U.S. route continues to rise, while the European route continues to decline.

At present, the freight rates on European and American routes are showing different trends, which has aroused widespread concern in the market. As the end of the Asian Lunar New Year approaches, factories are on vacation and shipments are reducing. Based on previous years’ experience, freight rates will be adjusted accordingly. However, this year, the American line has shown an unusual "exceptional" trend. Even though the freight rates on the European and Mediterranean routes have declined for two consecutive weeks, the increase in the American line has not subsided. It is understood that shipping companies such as CMA CGM, Evergreen, and Yang Ming announced price increases again on February 1, with an increase of approximately US$500.

Freight rates on European and Mediterranean routes began to decline due to no increase in cargo volume and reduced demand. Especially during the period from the end of the Lunar New Year to March, freight rates lacked support and showed a downward trend. Logistics industry insiders pointed out that some people over-interpreted the impact of falling freight rates on European lines, causing panic among some people who did not understand the market conditions. The impact of the Red Sea crisis is comprehensive, and this time the two major canals have traffic difficulties at the same time, the impact is more serious than the epidemic. If the long-term problem cannot be solved, the impact on the logistics supply chain will become more serious. Everyone will wait and see.

The global container shipping market still faces a shortage of ships and containers. Except for the decrease in cargo volume after the Lunar New Year and the relatively loose supply caused by detouring ships back to Asia, it is normal for the European line's freight rates to fall slightly. It is expected that the market will face a more serious shortage of ships and containers starting from March when China starts shipping.

According to foreign media reports, since the Houthi armed forces began attacking merchant ships near the Red Sea at the end of 2023, more than 2,000 ships have been forced to reroute around the Cape of Good Hope in Africa. This has led to extended voyages, rising costs, soaring freight rates and delayed deliveries, severely disrupting global supply chains.

Industries such as the automotive and retail industries that rely on manufacturing in Asia have been particularly severely affected. The situation of order placement and inventory replenishment after the year has attracted much attention. According to the latest freight rate data released, freight rates from the Far East to North America continue to rise sharply. The freight rate per 40-foot container from Asia to the United States exceeded the US$5,000 mark, with a weekly increase of US$593, reaching US$5,005, an increase of more than 13.4%. The freight rate per 40-foot container from the Far East to the US East was US$6,652, an increase of US$239 or 3.7% from the previous week.

The freight rate per 20-foot container from Shanghai to Europe was US$2,723, a decrease of US$138, and a weekly decrease of 4.82%; the freight rate per 20-foot container from Shanghai to the Mediterranean was US$3,753, a decrease of US$150, and a weekly decrease of 3.84%. Although the freight rates from the Far East to Europe have declined after consecutive doublings, it is expected that freight rates will only fall slightly as supply increases after ships return in late February.