Spot rates on the Trans-Atlantic fronthaul trade from North Europe to the US East Coast (USEC) are plummeting rapidly. According to Xeneta's platform data, the monthly average rate for a 40-foot standard container (FEU) has dropped dramatically, falling from USD 5,298 (excluding Terminal Handling Charges) in January to a mere USD 809 in August.
The trans-Atlantic trade’s fall of 85% is a serious loss-maker for carriers. Taking out THC narrows in on the ocean freight rate, which by mid-August was priced at almost the same level.
Shippers on the trade are taking full advantage of this new reality, regaining the upper hand after the 2021-2022 pandemic period delivered dramatically high freight rates. Xeneta’s real-time data, crowd-sourced from leading global shippers shows the strongest are now paying less than USD 475 per FEU for spot business.
At USD 2,000 per FEU (excluding THC), North Europe to USEC long-term rates are still 2.5 times above spot levels, meaning this is the only fronthaul trade where long-term business remains above short-term rates; all other key trades have normalized in this respect.
Transport volumes on the trade were down by 13.6% in the first half versus last year (source: CTS), with April alone scoring a 23% year-on-year fall. Xeneta data showing a spot-market slide from USD 3,875 per FEU at the end of March to USD 2,450 per FEU by 1 May.
Carriers have used this trade lane as a “parking lot” for excess capacity not deployed on other corridors. Data from Sea-Intelligence indicates that capacity on the North Europe to North America East Coast trade rose by 23.6% in the first half versus 2022 (and by more than 30% just in February and April).
Pre-pandemic contract levels were hovering at USD 1,300 to USD 1,400 per FEU (excluding THC), with very few dollars separating them from spot rates. This was despite the fact that there are major differences between long-term and short-term contracts.
Xeneta is the leading ocean and air freight rate benchmarking and market analytics platform transforming the shipping and logistics industry. Xeneta’s reporting and analytics platform provides liner-shipping stakeholders the data they need to understand current and historical market behavior – reporting live on market average and low/high movements for both short and long-term contracts. Xeneta’s data is comprised of over 350 million contracted container and air freight rates and covers over 160,000 global ocean trade routes and over 40,000 airport-airport connections. Xeneta is a privately held company with headquarters in Oslo, Norway and regional offices in New York and Hamburg.