The world’s ten top container lines could lose as much as US$13.3 billion in revenue this year, unless they can push-up rates, ifw reports.
The figure is an estimate from SeaIntel Maritime Analysis, based on freight rate statistics from the Shanghai Shipping Exchange which measures the development in spot rates on main trades out of Shanghai.
In 2010, the average freight rate for “main haul” routes (transpacific, Asia-US east coast, Asia-Northern Europe and Asia-Mediterranean), was $3,083 per feu, a figure expected to fall 28% to $2,219 per feu this year.
SeaIntel said this trend could be extended to all trade lanes.
“Most other trades globally have been seeing consistent declines,” said the analyst.
“If we assume an average top-10 carrier has 25% of its volume locked into long-term contracts at 2010 levels, valid until 2012, and we further assume that other trades only decline at half the rate of the main haul – 14% – the carrier would still face an average freight rate decline of some $380 per feu in 2011.
“Any decline in the freight rate is passed right through to a [carrier’s] bottom line.”
SeaIntel said it had been estimated that the top ten container carriers would transport 35 million feu this year.
Using its estimate of an average rate decline of $380 per feu, this would see turnover by these carriers plunge $13.3 billion on 2010, which could result in net losses for the year.
Yesterday, IFW reported that freight rates had continued to tumble over the last few weeks, almost dipping below the US$1,000 per teu mark on the Asia to Europe trade.
The latest Shanghai Containerised Freight Index shows prices on the four main trade lanes fell in the week ending 20 March from the week before and rates are now at their lowest point since September 2009.
And with no capacity reductions yet announced by shipping lines, observers said planned rate increases were looking less and less likely.
Prices from Shanghai to North Europe fell to $1,019 per teu from $1,076 the previous week, while rates from Shanghai to ports in the Mediterranean slumped to $1,001 from $1,042.
Meanwhile, rates from Shanghai to the US west coast slipped $37 to $1,617 per feu and rates to the east coast fell $41 to $2,821 per feu.
However, some freight forwarders have reported shipping lines quoting rates as low as $800 per teu on services from Shanghai to the UK.
The figure is an estimate from SeaIntel Maritime Analysis, based on freight rate statistics from the Shanghai Shipping Exchange which measures the development in spot rates on main trades out of Shanghai.
In 2010, the average freight rate for “main haul” routes (transpacific, Asia-US east coast, Asia-Northern Europe and Asia-Mediterranean), was $3,083 per feu, a figure expected to fall 28% to $2,219 per feu this year.
SeaIntel said this trend could be extended to all trade lanes.
“Most other trades globally have been seeing consistent declines,” said the analyst.
“If we assume an average top-10 carrier has 25% of its volume locked into long-term contracts at 2010 levels, valid until 2012, and we further assume that other trades only decline at half the rate of the main haul – 14% – the carrier would still face an average freight rate decline of some $380 per feu in 2011.
“Any decline in the freight rate is passed right through to a [carrier’s] bottom line.”
SeaIntel said it had been estimated that the top ten container carriers would transport 35 million feu this year.
Using its estimate of an average rate decline of $380 per feu, this would see turnover by these carriers plunge $13.3 billion on 2010, which could result in net losses for the year.
Yesterday, IFW reported that freight rates had continued to tumble over the last few weeks, almost dipping below the US$1,000 per teu mark on the Asia to Europe trade.
The latest Shanghai Containerised Freight Index shows prices on the four main trade lanes fell in the week ending 20 March from the week before and rates are now at their lowest point since September 2009.
And with no capacity reductions yet announced by shipping lines, observers said planned rate increases were looking less and less likely.
Prices from Shanghai to North Europe fell to $1,019 per teu from $1,076 the previous week, while rates from Shanghai to ports in the Mediterranean slumped to $1,001 from $1,042.
Meanwhile, rates from Shanghai to the US west coast slipped $37 to $1,617 per feu and rates to the east coast fell $41 to $2,821 per feu.
However, some freight forwarders have reported shipping lines quoting rates as low as $800 per teu on services from Shanghai to the UK.