Xeneta Shipping Index drops 6% in November
Xeneta Shipping Index (XSI) for the contract market dropped by 5.7 percent in November.
"This is the third month in a row rates have dropped but the largest month-on-month decline recorded since the launch of the XSI in 2019," says the latest update.
For many carriers, the fall in XSI will trigger the fall in their average rates and will bring an end to record-breaking quarters, the update added.
"Q32022 results for several large carriers showed their average rate increased from Q2 despite the collapse in the spot market. With long-term rates now firmly coming down, carriers will no longer be able to hide falling volumes behind higher rates."
Patrik Berglund, CEO, Xeneta says: "A drop in long-term rates is no surprise but the scale of this demonstrates the challenges facing the industry at present."
Berglund adds that depressed consumer demand in the face of the cost of living crisis is leaving carriers in a position where they're now "fighting for volume" after over two years of strong demand, supply chain congestion and under-capacity.
"We've already seen how spot rates have collapsed since summer, and after a few months of very slender long-term rates drops, we're now witnessing a 'catch-up' as existing agreements expire and new contracts come into force," says Berglund.
XSI - U.S. imports/exports
The US import index fell to 538.18 in November, down 8.9 percent from October. "Volumes on the Transpacific continue to be muted. However, spot rates on the Transpacific seem to have stabilised at a low level with some carriers reporting some of their services are now below breakeven levels."
The index for U.S. exports fell 5.3 percent in November. "This still marks a 25.4 percent increase since the start of the year and up by 38.6 percent from November 2021."