Container rates out of India on major trades see sharp gains amid capacity woes
MUMBAI : Container freight rates on trades out of India have seen strong gains in July amid heightened demand linked to early peak season bookings and persistent capacity disruptions, according to a market analysis.
On the westbound India-Europe trade, average short-term contract rates for bookings from West India [Jawaharlal Nehru Port (JNPT)/Nhava Sheva or Mundra Port] to Felixstowe/London Gateway (UK) or Rotterdam in April have climbed to US$4,200 per 20 foot container and US$4,500 per 40-foot container, from US$3,100 and US$3,200, respectively, at the end of June.
For West India-Genoa (the West Mediterranean) bookings, rates have risen to US$4,400/TEU, up from US$3,300, and US$4,600/FEU, up US$3,400/FEU, month on month, the CN analysis shows.
However, eastbound cargo (imports into India) rates for these port pairings have seen mixed rate trends month on month. While spot rates gains have remained relatively steady for bookings from Felixstowe/London Gateway to West India, at US$1,300/TEU and US$1,450/FEU, Rotterdam-West India rates have ticked up to US$1,300/TEU and US$1,450/FEU, from US$950 and US$1,400/FEU, respectively, reported at the end of June.
For trades from the West Mediterranean (Genoa) to West India, July rates have stood at US$950/TEU, up from US$800, and US$750/FEU, down US$1,400.
Spot prices on the India-US East Coast trades have jumped dramatically in July because of serious capacity pressures. Average rates for shipments from West India (Nhava Sheva/Mundra) to the US East Coast (New York) have soared to US$9,500/TEU and US$10,500/FEU, from US$2,000 and US$2,300 in June. For Indian container loads moving to the US West Coast (Los Angeles), rates have reached new highs – hovering at US$10,600/TEU and US$12,000/FEU, from US$2,650 and US$3,000, respectively, reported at the end of June.
Similarly, for the West India-US Gulf Coast (Houston) trades, average July rates have hit US$10,000/TEU or FEU, from US$3,500 a month ago, according to the CN analysis.
Rates on the US East Coast-West India trades (return leg) have generally held firm month on-month, hovering at US$550/TEU and US$750/FEU. From US West Coast to West India, booking rates have stood at US$1,950/TEU and US$2,500/FEU.
Average rates from the US Gulf Coast to West India have also seen no changes from June averages – hovering at US$1,300/TEU and US$2,050/FEU.
Carrier rates on intra-Asia trades out of India have continued to be in negative territory, on most port pairings, the CN analysis found. For West India-Yantian (South China), the analysis put average rates in April at US$25/TEU and US$35/FEU, and for West India Tianjin (North China), carriers are accepting bookings at as low as US$5/TEU and US$10/FEU.
For West India-Shanghai (Central China) trades, rates have also remained in negative territory, at as low as US$5 per TEU or FEU.
Also, for West India loads to Singapore, carriers are also accepting bookings at as low as US$5/TEU or FEU. July rates for West India-Jebel Ali (Dubai) bookings have strengthened strongly to US$700/TEU, from US$250, and US$1,400/FEU, from US$300.
Meanwhile, India’s merchandise export trade has continued to be on a positive note in the new fiscal year 2024-25, which began in April.
According to provisional government data, total goods exports by value were up 2.5% year-over-year to US$35 billion.
“Had it not been for the logistics disruptions such as lack of container availability, shipping space, irregular shipping schedule and ships skipping Indian ports, the exports would have recorded close to double-digit growth in June 2024,” Ashwani Kumar, President of the Federation of Indian Export Organisations (FIEO) said in a statement.
Kumar also noted: “We are optimistic of better growth numbers with improved demand coming in from the European Union, UK, West Asia and the US in months to come, which will not only further give a boost to the overall order bookings but also to the labour intensive sectors of exports.”
He went on to explain: “We further expect exports to show better growth numbers with improved demand coming in from the European Union, the UK, West Asia and the US, which has given boost to the order bookings by over 10 % and has come as sign of recovery for labour-intensive sectors of exports.”
Kumar also added: “Our exports to eight of all our top ten markets including the US, UAE, the Netherlands, the UK, Saudi Arabia, Bangladesh, Germany and Malaysia were positive, except with minor declines in China and Singapore, also with many of them recording healthy double-digit growth.”
According to FIEO: “The need of the hour is to take steps on the liquidity front with deeper interest subvention support and continuation of interest equalisation scheme for five years.”
The association also appealed: “The sector also needs easy & low cost of credit, marketing support and conclusion of some of the key FTAs with the UK, Peru and Oman soon.”
Source : Container News