The container market has taken a turn in recent months, but high rates and carriers’ profits will not curb overnight. Many ports are still in a state of congestion. In its latest Container Forecast, Drewry pointed out that the end of the container market bull run may be close as shipments along most trade routes are down with high inflation preventing a volume bounce-back.
The decreasing demand has driven container freight rates lower week by week over the last four months. Drewry’s World Container Index shows rates declined 3 per cent just this week – 16 per cent lower than a year ago and down significantly from the September 2021’s peak.
Despite this decline, Drewry said ocean carriers are still holding the aces as there is no sign that port bottlenecks are going away soon. AIS ship tracking data has revealed that the number of containerships waiting outside of major ports is indeed growing.
“With no changes to our expected supply chain recovery timeline the market will continue to be denied capacity that it otherwise would have had access to,” says Drewry.
Source: porttechnology.org