Another collapse of the container and bulk transport market
Another collapse of the container and bulk transport market
The past months have not been very kind to the international transport industry, but at the end of November, the biggest records were broken. Not only general cargo and bulk carriers have been subject to big reductions, but also container transport. For example, on routes between Northern Europe and Asia, freight rates have reached the level of less than three hundred dollars for one container unit, which means a decrease by nearly a third compared to the previous week. Smaller price reductions were recorded on routes to ports in the Mediterranean Sea, the crisis did not spare freight from countries in the Far East to US ports. In fact, there have been significant price drops on the vast majority of routes, which ranged from a few percent to the aforementioned thirty. The SCFI examining the rates between the ports in Europe and China will show these problems very well, including the Gdańsk DCT analysis. Friday's result at the end of November is the worst in the history of this survey, which have been running continuously since October 2009 year.
This type of situation is the result of several things. First of all, economies in Asian countries slowed down quite sharply, it is especially visible in the largest country of those regions, ie China. The progressive devaluation of the yuan resulted in a large reduction in the demand for goods imported from Europe and America, and this in turn translates into less transport demand. The second important reason for price reductions is the growing oversupply of cargo space on ships, which is also present recently. A lot of new units have been created in recent years, which are currently not 100% used, the result of all these investments is the indebtedness of the industry for a considerable amount 80 billions. The current crisis has put many companies in a difficult position, some of them will have to seek help from banks, to deal with debt. Analysts are of the opinion, that the market situation will stabilize in the coming quarters. The rates are to rise slowly, in order to finally reach the threshold of one thousand dollars per container unit desired by most shipowners.
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