Shipping rates increased by $1,000! Shipping companies announce the new rates effective from August 15

Major route operators plan to adjust shipping rates from Asia to the US West Coast in mid-August to respond to recent market fluctuations and offset the impact of previous adjustments. According to overseas media reports, starting from August 15, several shipping companies have announced an increase of $1,000 per 40ft container to curb the downward trend in shipping rates on this route over the past three weeks.

Last Friday’s Shanghai Containerized Freight Index showed that shipping rates from Shanghai to the US West Coast had significantly dropped by about 7% compared to the previous week, averaging $6,663 per 40-foot container. Despite this drop, the rate remains much higher than the $1,943 per 40-foot container recorded in the same period last year.

However, market analysis firm Linerlytica noted in its report on the 31st that carriers face severe challenges due to a significant recent increase in capacity on routes from Asia to the US West Coast and Mexico, disrupting the previously tight supply-demand balance. This decline in capacity utilization is particularly noticeable even during the traditional peak shipping season.

Notably, the third quarter, traditionally a peak shipping season, has seen sustained strong growth in cargo volumes. However, newly introduced shipping services such as SeaLead Shipping’s AWC service and various ad-hoc USWC sailings have increased the total capacity on this route by more than 15%.

Linerlytica estimates that the current total number of vessels operating on this route has reached 306, with a carrying capacity exceeding 2.58 million TEUs (twenty-foot equivalent units), representing a 14% increase compared to the same period last year.

Meanwhile, shipping rates from Asia to the US East Coast have also shown a downward trend, decreasing by 2% compared to the previous week, with the average rate remaining at $9,557 per 40-foot container. The capacity on this route remains largely unchanged from the same period last year, exceeding 2.75 million TEUs.

In contrast, shipping rates on the Asia to Europe route have remained stable, with almost no change, averaging $4,991 per 40-foot container. This stability is mainly due to the tight capacity compensating for the reduced cargo volumes.

Linerlytica noted that although the vessel utilization rate on the Asia to Northern Europe route has declined from its peak in May and June, the market capacity remains tight. Adverse weather conditions and port congestion have led to vessel accumulation on Northern Europe and Mediterranean routes, significantly reducing schedule reliability.

Some additional loading sailings have been canceled as a result, such as CMA CGM’s planned French Peak Service, which was originally set to have seven sailings in September but has now been reduced to four. This adjustment aims to respond to seasonal demand changes.