The last leading shipping line still using the Suez Canal, despite continued attacks by Houthi rebels from Yemen, appears poised to follow the current global trend of diverting vessels away from conflict in the Red Sea and Gulf of Aden.
While freight forwarders for Europe-Asia ocean cargo await an official statement on the matter by CMA CGM, rates for voyages around the Southern African coast continue to increase.
The latest information from shipping platform Drewry on the spiking cost of sailing around Africa instead of through the Suez is that forty-foot equivalent unit (FEU) rates have shot up by as much as 200%.
In general, rates hover around $5000 per forty-foot container, but in a desperate dash to meet inventory deadlines before the Chinese New Year, some agents are asking $10,000 per FEU between Europe and Asia.
However, it has also emerged that the Ningbo Containerized Freight Index has recorded a drop in demand, leading to some FEU rates decreasing to about $4,661 per container.
It’s unsure whether this is because some shippers are pulling back from ocean freight, preferring airfreight, although this Red Sea-related development has been confirmed by the relevant monitoring authorities.
Nevertheless, steady demand and ensuing price fluctuation are driving a new-normal situation for around-the-Cape rotations, with departure and arrival times factored into the equation.
The lag that has appeared in the supply system because of changing box movement dynamics also seems to have been largely dealt with, shipping platforms indicate.
