Congestion at Europe's ports has affected effective capacity, but not enough to prevent rates from falling on European routes

SCFI Shanghai export container freight index fell 54.2 per cent in the third quarter. Freight rates to America and the West (the basic port) dropped a whopping 67.3% last quarter. The number of ships waiting to enter Los Angeles or Long Beach fell below 10 in September, while the number of ships queued in SAN Pedro Bay hit an all-time high of 109 in January 2022.

It's worth noting, though, that Europe's port congestion problem is far from solved. Delays at ports in northern Europe have caused many ships to return to Asia weeks behind schedule. This had a knock-on effect, and shipping companies often did not have enough tonnage to arrange all future voyages from the Far East to Europe. But spot rates from Shanghai to northern Europe fell 48.5 per cent in the third quarter.

Nordic container ports received 17% fewer calls than expected from Far Eastern routes in the third quarter. Hamburg (38 port jumps) and Felixstowe (27 port jumps) were the biggest victims of dockworkers' strike action and traffic congestion.

Members of THE Alliance skipped 26% of port calls. Rotterdam Rotterdam (8 stops), Wilhelmshaven (7 stops) and Zeebrugge Zeebrugge (7 stops) were the main beneficiaries of the transfer stops. The 2M alliance MSC and Maersk had 15 per cent fewer European connections than planned in the third quarter, compared with 12 per cent for maritime Alliance members.

With UK ports out of service during two weeks of strike action, Felistowe, unsurprisingly, missed the highest proportion (-35%) of planned Far East mega route calls in the third quarter, and most ships served by COSCO/OOCL's AEU1/LL1 route have only called on a UK port once. For other ports, see the figure above.

After war in Ukraine, inflation dangerously out of control, a punishing wave of COVID-19 infections and lockdowns, the International Monetary Fund delivered more bad news this week: the pain is far from over, and the worst is yet to come. At the start of its annual meetings in conjunction with the World Bank, the multilateral lender warned that "the darkest hour" was still ahead. With recession likely to be felt in much of the world next year, further market sell-offs cannot be ruled out.

Shenzhen Xunlaitong specializes in shipping export from Shenzhen to Australia & New Zealand, Germany, Netherlands and more business

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