Containership rates burst into action in the past week with several main benchmark rates leaping by 15-25% week-on-week, including those rates from Shanghai to South America (basis Santos), which rose by more than 25% to reach US$ 2,260/TEU, according to the SCFI. The main index itself increased by a very strong 8.5%, as a measure of all rates together, posting 829.7 by the end of last week. Other big gainers included rates to USWC, which rose by 24.5% week-on-week to US$ 1,720/TEU. Rates to USEC rose as well, if not quite as sharply, gaining 16.0% on the week to hit US$ 2,789/TEU. The combined US destination routes account for 40% of the total SCFI calculation, so their increase has had a significant impact. Rates to Europe were less spectacularly improved with Mediterranean Sea redelivery, in fact, losing 0.7% on the week to settle in the vicinity of US$ 726/TEU, based on the SCFI.
Traders note that secondhand activity has kept apace with a handful of shipping trading hands in the past week, among them the 1,740 TEU, geared and 2007-built “Hansa Marburg” which was purchased by Chinese buyers at US$ 6.4m, but then failed before then being resold to buyers OKEE for the price of US$ 5.8m. Another 3,380 TEU, gearless, 2005-built vessel, the “TIM S.” was sold to Nordic Hamburg for what is said to be just under US$ 7.0m.
The ongoing US-China trade war may not be as dire for container shipping as previously feared, said Drewry in a recent report. The analyst estimates that any impact from the trade war will be brief as trade patterns shift and find new balance in supplying countries and exporting countries. Further, says the report, in the medium term the trade war could even end up being beneficial to the shipping sector as purchasers are forced to find new sources for their requirements. The benefits to shipping from newly fragmented production and fragmented sourcing would essentially add new tonne-miles to the market, thereby lifting freight rates in the process.
Troubling for one of the world’s big industrial drivers, Japanese manufacturing saw its sharpest fall in three years in June, according to the Flash Japan Manufacturing PMI, which fell to 49.5 from 49.8 in the month before. This was noted as the steepest decline in new orders since June of 2016. On the other hand, analysts note that backlogs are being reduced by the fastest degree since early 2013, giving some reason for hope in an upcoming recovery.
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