Freight rates hit 2019 levels
The container shipping industry is experiencing a downturn in 2023, with a nearly 2% year-on-year decline in container volumes and a significant drop in freight rates, returning to 2019 levels by September.
Despite these reductions, chartering costs remain 25% above 2019 averages. The liner fleet has grown by 5% compared to 2022 and by 19% relative to 2019, while container volumes have only marginally increased since 2019. Fuel costs, a major expense for liner operators, have decreased compared to 2022 but remain higher than in 2019. Time charter costs are particularly high due to contracts dating back to 2021 and 2022.
However, head-haul trades show more resilience, with volumes and freight rates slightly above 2019 levels. With the fleet expected to expand by 9% in 2024, further pressure on the market is anticipated, potentially hindering freight rate rises, although time charter rates might continue to decline. (pb)