The World Container Index (WCI)–a composite of container freight rates on eight major routes to and from the U.S., Europe and Asia–assessed by maritime research group Drewry, was down 1.5 percent to $1,290.80 per 40-foot container or equivalent unit (FEU) for the week ended May 30.
The composite index was down 6.9 percent from a year earlier. However, the average composite index of the WCI for year-to-date was $1,485 per FEU, which was $21 higher than the five-year average of $1,464 per FEU. Drewry said it expects that general upward pattern to maintain and that rates will increase next week.
As trade between the U.S. and China weakens over tariff-fueled trade conflicts, freight rates from Shanghai to New York declined $154 to $2,502 per FEU. Rates on the Shanghai to Los Angeles route fell $73 to reach $1,262 per FEU.
Similarly, rates on Rotterdam to New York, the main ocean route for Trans-Atlantic trade, dropped $71 to $2,272 per FEU. Bucking the trend, freight rates on Shanghai to Genoa, Italy, shipments increased $40 and stood at $1,452 per FEU.
In reporting first quarter results last week, A.P. Moller – Maersk said profitability in ocean shipping increased in the period. Earnings before interest, taxes, depreciation and amortization (EBITDA) grew 42 percent $927 million, mainly driven by a 3.9 percent increase in average loaded freight rates and an improvement in operating cost.
Revenue in the Ocean division increased 0.1 percent to $6.9 billion, despite a 2.2 percent decline in volume, which Maersk said was impacted by the frontloading seen on the Pacific trades in the fourth quarter on tariff threats and ahead of Lunar New Year factory shutdowns, and weak demand on Latin American and Oceania trade.
CMA CGM Group reported this week that container volume rose 4.4 percent to 4.95 million 20-foot container or equivalent units (TEU) in the first quarter, marked by strong development in intra-regional routes. Revenue per TEU increased slightly compared to the year-ago quarter, particularly on the routes serving the U.S. and Africa.
Overall revenue was up nearly 37 percent year-on-year to $7.41 billion. CMA CGM said it will “continue to closely monitor current geopolitical tensions and the evolution of oil prices, and their impact on the world economy.”