Return of downward pressure on container spot freight rates
Container spot freight rates on the main east-west trades were largely flat this week, after ...
© Khunaspix Dreamstime.
By Mike Wackett
A quick glance at the Shanghai Containerized Freight Index all-in spot rate graph for Asia-North Europe over the past year confirms one thing: the patient is unstable and in a critical condition.
The year has ended with a final surge of 61% on SCFI spot rates ...
Comment on this article
Richard Ward
December 18, 2013 at 5:05 pmCouldn’t have put it better. The industry is in turmoil with both shipper and carrier bearing the brunt of rate volatility. Could carriers do more to stabilise their cash flows? Absolutely. With container freight hedging on the rise they now have the tools available to remove the effects of rate volatility on their balance sheet.
Similarly such rate volatility places shippers’ contracts at risk, who are now turning to alternative contracting methods such as linking they physical rate to the SCFI and then hedging against future rate increases.
The market is undeniably going through a transition. However for those willing to embrace them, there are now the tools available to mitigate this risk.