News / Africa-Europe rates drop as trade shifts and carriers redeploy capacity

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After a May-June double-digit rate spike, trade between Africa and Europe is looking far less rosy, with suggestions that additional capacity and improved operations have capped rates, leading to something of a levelling-off in pricing.

Latest data from Container Trades Statistics (CTS) – which runs two months behind – shows that after a bumper May and June, with Europe-Sub-Saharan Africa (SSA) rates up 7.7%, and 12% year on year, respectively, July flattened against the same period last year.

Cindy Luyt, general manager for 1Up Cargo in South Africa, told The Loadstar that part of the reason for this levelling off may be a reduction in demand – although she was “not at all sure why” – even as supply remained consistent.

Echoing Ms Luyt, the South African Association of Freight Forwarders’ head of research and development, Jacob van Rensburg, said a trio of issues was putting pressure on African rates in the wake of a global spike in pricing in May and June.

“Carriers redeployed capacity, especially into West Africa, port performance, especially in South Africa, but also Abidjan’s capacity expansion, improved slightly, and overcapacity pressures re-emerged,” Mr van Rensburg told The Loadstar.

“It is important to note changes in South African rates especially, and I would presume this is the same for SSA, are typically four to six weeks behind the global indices. Despite Red Sea diversions persisting, fleet additions and redeployment have continued to drive down rates.”

In the other direction, the situation looks less optimistic, CTS noting a July rates crash of 4.1% year on year, with Mr van Rensburg suggesting seasonality was playing into the situation amid a reefer fade, softer commodity exports, and excess capacity.

Mr van Rensburg said carrier capacity loops into West Africa could keep Europe-to-SSA rates flat, while commodity crops in the forthcoming southern hemisphere summer and sustained port performance in South Africa, were also worth keeping an eye on.

According to CTS data, during the first seven months of this year, some 1.24m teu was shipped from Europe to sub-Saharan Africa, a 2.8% increase on the same period in 2024, while the norhtbound trade has seen year-to-date volumes grow 5.1% over the first seven months of 2024, to reach 643,900 teu.

Asked for her take on volume development, Ms Luyt said: “There’s still definitely movement, but the traditional three-quarter spike has not been anywhere near past. It seems as if a lot of trade has moved to South America, Middle East and Asia.”

Interestingly, this reflects what forwarders in South America have been telling The Loadstar.