After the record-breaking falls of January, global long-term ocean freight rates held up surprisingly well in February, boosted by “a special month” for US exports. According to the latest data from the Xeneta Shipping Index (XSI®), average long-term contracted rates dropped by just 1% across the month, following on from a 13.3% month-on-month collapse in January. Despite the relatively strong performance, seen against a backdrop of weak fundamentals, Xeneta notes that this is the now the sixth consecutive month of falls, with the index losing 22% of its value since August 2022.

All eyes on TPM

“Given the lack of demand, challenging macro-economic conditions, deflated spot rates, and rampant industry overcapacity, observers may have expected a continuation of the steep downward trend for long-term contracts,” comments Xeneta CEO Patrik Berglund. “However, a powerhouse performance for the US export benchmark, with a 16.5% appreciation, arrested the decline, pushing that particular corridor to an all-time high.”

He continues: “That said, one stand-out performer should not cloud the big market picture. If we look across the rest of the trade lanes the development remains clear for all to see. The drops may not be as dramatic as we saw last month, but there’s still some sizable declines on the world’s leading corridors. So, it remains a very challenging situation for carriers fighting to secure cargoes, and that should continue to impact upon rates going forwards. It’ll be interesting to see what happens at TPM this week, which will operate as a focal point for new contract negotiations.”

Source : marineinsight.com/shipping-news/ For More Details