News / Early peak sees demand – and rates – increase on intra-Asia lanes

Photo: VesselFinder

Intra-Asia container freight rates have reached a two-year high as the peak season (July-October) is brought forward and demand grows.

Drewry’s Intra-Asia Container Index showed, on 15 May, rates averaged $939 per 40ft, up from $918 a fortnight ago, and 43% higher year on year.

Also on 15 May, the Shanghai Containerised Freight Index showed Shanghai-South-east Asia rates averaged $570 per teu, up $7 on 8 May and 31% higher year on year.

Drewry MD Philip Damas told The Loadstar oil prices were the most critical factor in intra-Asia rates.

He said: “These changes continue to push up the Drewry Intra-Asia Container Index week after week, and the index is now 70% higher than before the start of the Iran conflict, with no sign of softening spot rates as long as the Strait of Hormuz remains closed.”

Drewry’s senior consultant, Stijn Rubens, added that the upward trajectory of freight rates was encouraging front-loading.

“Shippers are uncertain of future increases and are therefore ordering their goods earlier. This brings forward the seasonality of the peak season, rather than increasing demand overall.”

Meanwhile, shipping lines have been launching more intra-Asia services to meet the demand.

X-Press Feeders and OOCL have introduced a South China Java X-Press (SCJX)/China-Indonesia Service 3 (CIS3) service, using three vessels of up to 2,900 teu, on a 21-day rotation of Xiamen-Nansha-Jakarta-Surabaya-Yantian-Xiamen.

And CMA CGM’s intra-Asia arm, CNC Line, recently offered a direct service to the North Sumatran port of Kuala Tanjung by introducing fortnightly calls at Kuala Tanjung to its South China-Straits-Bangladesh-Vietnam  BBX3 service.

The updated rotation is Nansha-Chiwan-Chittagong-Kuala Tanjung (fortnightly)-Singapore-Port Klang-Da Nang-Nghi Son-Haiphong-Nansha. It continues to turn in five weeks with five 1,700 to 2,200 teu vessels, with the 2,202 teu CMA CGM Fuji making the loop’s debut at Kuala Tanjung on 11 May.

The BBX3 also provides the Indonesian port with direct connections to  Bangladesh, Vietnam, and China.