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, ...
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By Alison Koo
Shanghai International Port Group (SIPG), which owns majority of the container terminals in Shanghai port, is halving container depot fees for shipments to and from all US ports.
The 50% discount is to ease the financial burden for shippers amid soaring transpacific rates, and will be in place until 31 August, coinciding with the end of the 90-day suspension of US-China reciprocal tariffs.
SIPG invited shippers to apply for the discounts via its website, but noted that dangerous goods and items transported in reefers were, however, excluded from the offer.
Storage for containers, both loaded and empty ones, is free for the first four days. Thereafter, for 20-foot loaded containers, the daily fees are CNY8 ($1) for the fifth to seventh day; CNY20 ($2.78) for the eighth to 10th day and CNY70 ($9.75) for the 11th day onwards. For 40-foot loaded containers, the daily fees are CNY16 ($2) for the fifth to seventh day; CNY40 ($5.56) for the eighth to 10th day and CNY140 ($19.50) for the 11thday onwards.
Spot ocean freight rates from Shanghai to the US surged last week when the shipping lines successfully implemented general rate increases (GRIs). According to the Shanghai Containerized Freight Index on Friday, spot freight rates from Shanghai to the US West Coast gained 58% in one week, averaging $5,172 per 40ft, up 128% year on year.
And spot rates from Shanghai to the US East Coast were up 46%, to $6,243 per 40ft, a year-on-year rise of 90%.
Rates are spiking with an influx of cargo on the trades as shippers rush to export their goods to the US before a potential reinstatement of tariffs, which were initially hitting 145% for imports from China.
However, Xeneta analyst Peter Sand told The Loadstar that the soaring freight rates were unlikely to have persuaded SIPG to subsidise depot fees.
He said: “Freight rates were somewhat higher during Covid without a similar offer. But, as we also see in the Caixin Manufacturing PMI [purchasing managers index] from China, the sector was struggling in April, with only little easing since then.
“This is, arguably, indirect state aid – not to a large extent, but most likely welcomed by Chinese manufacturers and exporters.”
Mr Sand noted that Xeneta’s mid-high freight rate for China-US West Coast shipments had almost doubled going into June, and was currently just above $6,000 per 40ft.
He added: “Our expectations are for the short-term contract market to peak in the first half of June, given what we know at this hour.”
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