The freight rate has dropped and the number of suspended flights has increased. This route is in sharp contrast to the popular Asia-Europe and Trans-Pacific routes!

It is reported that the spot freight rates of the transatlantic shipping routes from Northern Europe to the east coast of North America have returned to the level before the epidemic, which is in sharp contrast with the popular Asia-Europe and Trans-Pacific routes. Other routes have an impact.

According to data from the Freightos Baltic Index, the price of a 40-foot container on the transatlantic route was US$2,026, which was the same as the price in April last year, while the low price in September was US$1,622.

And now the freight from China to Europe for a 40-foot container is now more than US$8,000. The average freight rate for the week of February 26 was US$8,308, a decrease of 1% from last week. The freight from China to the West Coast of the United States was nearly US$5,000. , The average freight rate in the week of February 26 was 4922 US dollars, an increase of 6% over last week.

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North Europe to North America East Coast

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China/East Asia to North America West Coast
However, according to a leading analyst, this quiet period may end soon, as carriers are focusing on relatively poorly performing service networks in order to maximize returns.

Niels Madsen, vice president of products and operations at Sea-Intelligence, a shipping consultancy, said that compared with the unprecedented surge in spot freight rates in Asia-Europe, trans-Pacific routes, and most other Asian routes, trans-Atlantic trade routes are “in the entire epidemic. It has remained very stable during the pandemic."

However, he warned that the number of suspended flights on this route would increase substantially, which may "foretell the imminent increase in freight rates."

Madsen said: "The transatlantic flight suspension is completely different from other deep-sea navigation." "Last year, due to the spread of the new crown virus in Europe and North America, there was only one H1 peak in the suspension flight."

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According to data from the eeSea liner database, the number of suspensions on this route began to increase in May. Starting in July, the shipping company suspended 8 to 10 times a month, and finally reached 11 out of the estimated 86 voyages in December.

And this trend continued in the first two months of this year, with 10 out of 74 voyages cancelled in January and 4 out of 64 voyages cancelled in February.

Although eeSea's records this month show that its capacity will increase to 699,000 teu, about 57% of its capacity will come from outside the three major shipping alliances. But the total shipping capacity in February was 592,000 teu, the lowest level in more than a year.

Sea-Intelligence stated that the transatlantic route "has a significant increase in the number of suspended flights by the end of 2020", which is "in sharp contrast with the trans-Pacific and Asia-Europe routes."

Madsen added: “In addition, compared with the same period last year, the level of suspensions announced in March and April has also been at a continuously rising level, which is also in sharp contrast to the above-mentioned voyage.”

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In fact, according to The Loadstar's market inquiries, ships from Northern Europe are already "fully loaded," a contact person added, "The e-commerce boom in the United States has boosted booking demand to the greatest extent."

Madsen suggested that the upcoming transatlantic suspension may have nothing to do with weak demand, but with the desperate search for ships to make up for the long-term congestion of US West Coast ports, which have an average of 30 ships waiting in San Pedro Bay every day.

Madsen said: "Relocating ships from less profitable routes is likely to be considered a kind of'first aid' measure to rescue trans-Pacific routes."

He warned: "From a quantitative level, people seem to have an incentive to shift capacity to more profitable routes, and this in turn will only bring about one consequence-an increase in transatlantic freight."