Intra-Asia lanes gain capacity and rates soar as Middle East loses out
Intra-Asia rates are now more than 80% higher than before the US/Israel conflict against Iran, ...
By Alison Koo
Intra-Asia rates have been kept elevated by high bunker prices, even though cargo volumes have been flat since the Chinese New Year in February.
The Shanghai Containerised Freight Index on Friday showed Shanghai-South-east Asia rate averaged $528 per teu, up from $515 the previous week, and up 18% year on year.
The Shanghai-Busan rate averaged $162 per teu, up from $162 the previous week, also up 18% from a year ago.
In comparison, Korea Ocean Business Corp’s Composite Container Index shows that on Monday, the Busan-South-east Asia rate averaged $1,085 per 40ft, a $15 increase from a week earlier.
South Korean regional operator Sinokor and affiliate Heung-A Line announced they would implement GRIs of $150 on the South Korea-Vietnam-Thailand route, $200 on South Korea-Malaysia, $300 on South Korea-Indonesia, and $400 on South Korea-India.
Sinokor compatriots SM Line, Namsung, and CK Line have levied a $100 GRI, while separately collecting a low-sulphur surcharge included in the overall freight rate.
On the other hand, Namsung subsidiary Dongyoung Shipping and Pan Ocean will, respectively, introduce an emergency fuel surcharge (EFS) of $100. Another South Korean feeder operator, Pan-Continental, will impose a $30 fuel surcharge on imports, on top of a $50 low-sulphur surcharge.
A Namsung representative told The Loadstar: “Since the US/Israel-Iran conflict, bunker prices have tripled, from $400 to $1,200 per tonne. If we don’t have surcharges, we can’t maintain our profits.”
Drewry’s Intra-Asia Container Index, which excludes terminal handling charges, shows that, on Friday, average rates dipped 3%, to $839 per 40ft. Rates assessed on 18 routes were dragged down by the Shanghai-Jawaharlal Nehru, which dropped 34% from the previous fortnight, to $1,342 per 40ft.
Drewry MD Philip Damas told The Loadstar that, while the consultancy’s index showed a correction, current rates were 26% higher year on year.
Alluding to the fall in China-India rates, he added: “There was a partial correction of the sudden rate spikes caused on some intra-Asia lanes by the Iran conflict in previous weeks. Rates from China to India remain 50% higher than before the start of the conflict.”
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