Shipping lines are losing a record $141 for each container they haul to Europe from Asia, the world’s second-largest trade route for the boxes, as slowing economies dent demand, ACM/GFI said, Manila Bulletin reports.
Companies are losing money even at a freight rate of $649 a container because of a fuel surcharge of $790 for each box, Mels Boer and Cherry Wang, container-derivatives brokers at ACM/GFI, said in a report e-mailed Oct. 28. Losses were at the highest level last week since a tally of rates began in March 2009, Wang said.
“Current rates on the route Asia to Europe are way lower than the lows seen in 2009,” said ACM/GFI, a joint venture between London-based ACM Shipping Plc and GFI Group Inc., located in New York. Shipping companies were losing $41 for each 20-foot box in June that year, according to the report.
Weakening economies are cutting demand for goods shipped in containers as fuel prices rise and an expanding fleet depresses freight rates to levels last seen in 2009, Nomura Equity Research analysts including Andrew Lee said in an Oct. 24 report. Neptune Orient Lines Ltd., Asia’s third-biggest container line, reported a third straight quarterly loss Thursday.
ACM/GFI got its freight cost from a weekly index produced by the Shanghai Shipping Exchange for the rate to northwest Europe from Shanghai that includes fuel and all other surcharges. For the fuel surcharge, it cited a formula for shipping a container to Rotterdam from China used by Maersk Line, the largest operator on the route.
Freight rates for Shanghai-to-northwest Europe shipments fell 4.1 percent in the week ended Oct. 28, the eighth drop in nine, the Shanghai exchange’s index shows. Rates reached a record high of $2,165 in March 2010, according to Boer. The cost to haul a 40-foot container to the U.S. from Asia gained $8 to $1,494, ACM/GFI said, citing the exchange.
Higher prices mean fuel now accounts for between 50 percent and 70 percent of container lines’ costs, compared with 30 percent in 2008-09, Wang said.
Container trade contracted for the first time in its 50- year history in 2009 as shipments to the U.S. and Europe from Asia, the world’s two largest trade lanes for the boxes, plunged 21 percent by volume before rebounding in 2010, according to Clarkson Research Services Ltd., a unit of the world’s biggest shipbroker.
Companies are losing money even at a freight rate of $649 a container because of a fuel surcharge of $790 for each box, Mels Boer and Cherry Wang, container-derivatives brokers at ACM/GFI, said in a report e-mailed Oct. 28. Losses were at the highest level last week since a tally of rates began in March 2009, Wang said.
“Current rates on the route Asia to Europe are way lower than the lows seen in 2009,” said ACM/GFI, a joint venture between London-based ACM Shipping Plc and GFI Group Inc., located in New York. Shipping companies were losing $41 for each 20-foot box in June that year, according to the report.
Weakening economies are cutting demand for goods shipped in containers as fuel prices rise and an expanding fleet depresses freight rates to levels last seen in 2009, Nomura Equity Research analysts including Andrew Lee said in an Oct. 24 report. Neptune Orient Lines Ltd., Asia’s third-biggest container line, reported a third straight quarterly loss Thursday.
ACM/GFI got its freight cost from a weekly index produced by the Shanghai Shipping Exchange for the rate to northwest Europe from Shanghai that includes fuel and all other surcharges. For the fuel surcharge, it cited a formula for shipping a container to Rotterdam from China used by Maersk Line, the largest operator on the route.
Freight rates for Shanghai-to-northwest Europe shipments fell 4.1 percent in the week ended Oct. 28, the eighth drop in nine, the Shanghai exchange’s index shows. Rates reached a record high of $2,165 in March 2010, according to Boer. The cost to haul a 40-foot container to the U.S. from Asia gained $8 to $1,494, ACM/GFI said, citing the exchange.
Higher prices mean fuel now accounts for between 50 percent and 70 percent of container lines’ costs, compared with 30 percent in 2008-09, Wang said.
Container trade contracted for the first time in its 50- year history in 2009 as shipments to the U.S. and Europe from Asia, the world’s two largest trade lanes for the boxes, plunged 21 percent by volume before rebounding in 2010, according to Clarkson Research Services Ltd., a unit of the world’s biggest shipbroker.