Increase in container rates continues, but will it last?

For the second week in a row, container spot rates are rising again after seventeen consecutive weekly declines. This week, container transport has become 3% more expensive. President Trump can celebrate a small triumph; the IMO has chosen to back down after threats and has postponed the decision on environmental measures for shipping by a year. The index now stands at a spot rate of $1,746 per 40-foot container. Drewry expects a slight increase in freight rates for next week as the annual contract negotiations are on the horizon and shipping companies want to stretch it as much as possible. Drewry reports that shipping companies on the routes from Asia to Europe have announced new FAK rates (fixed freight all kinds rates) ranging from $2,600 to $2,700 per 40-footer, which will take effect on November 1. With this, they are trying to curb further declines in rates. Although these FAK rates are currently higher than the spot prices, they can still be attractive for shippers as they offer more certainty about space on a ship and shipment. It can also be useful if prices in the spot market are expected to rise. Incidentally, no dramatic decline in spot rates is expected. The current prices are still significantly lower than last year, despite the increase in the past two weeks. The index has fallen by 44% year-on-year, with transport from China to Rotterdam decreasing by 45%. The route from Shanghai to LA has even dropped by 52%. Only container transport from New York to Rotterdam has risen by 12%. Drewry's Container Forecaster predicts that there will be relatively more supply coming in the upcoming quarters compared to demand, causing spot prices to decline as a result. Environmental measures for shipping postponedThe international maritime UN organization IMO, which met last week in London, has postponed the decision-making on a global fuel standard and price mechanism for greenhouse gas emissions by a year. US President Donald Trump threatened to refuse ships flying the flags of countries that would vote for the environmental measures entry into US ports or subject them to high port fees. Port congestion in Rotterdam and AntwerpIn the port of Rotterdam, the backlog that built up between October 8 and 12 has not yet been (completely) resolved. The dockworkers went on strike then for better pay, and an activist group blocked transport to terminals. According to data from GoComet as of October 23, ships should expect an eight-day delay. That is one day longer than a week earlier. In Antwerp and Zeebrugge, the waiting time is six days according to data from GoComet. For the Port of Antwerp, the delay has therefore increased by two days in one week. Flemish pilots conducted punctuality actions, which have been suspended. The port itself reported on Monday that there was no longer any congestion for outgoing ships and that the backlog for incoming ships was almost completely resolved, and there was no impact for Zeebrugge. Data from VesselFinder shows that there are significantly fewer ships anchored off the Dutch and Belgian coasts than a week ago, indicating that the congestion is easing.