The (currently unstoppable) decline in containerized ocean freight rates continues, both globally and, in particular, on the Asia-Europe trade. The latest updates just published by Drewry show that the World Container Index fell a further 6% this week, dropping to an average global freight rate of $2,119 (-59% compared to twelve months ago). This is the eleventh consecutive week of decline, and analysts expect a continued downward trend for the foreseeable future.

The instability in container ocean freight rates began after the announcement of US tariffs in April, which caused freight rates to rise from May until early June. From then on, rates plummeted until mid-July and continued to decline until this week.

Drewry notes that spot container rates on the transpacific trade have progressively declined: on the Shanghai-Los Angeles trade, the decline was 3% ($2,332/FEU) and 5% ($3,291/FEU) on the Shanghai-New York trade. Accelerated purchasing by U.S. receivers to avoid tariffs led to an earlier peak in the season, but this effect has subsided. Drewry expects rates on this trade route to continue declining in the coming weeks.

Asia-Europe spot rates also declined this week, with a 10% decline ($2,661/FEU) on the Shanghai-Rotterdam route and a 5% decline ($2,842/FEU) on the Shanghai-Genoa route; the latter is 57% lower than the same week last year and nearly $1,000 lower than the levels seen just three weeks ago ($3,084/FEU). Despite sustained demand and congestion in many European ports, growing vessel overcapacity has pushed down spot rates for containerized cargo shipping worldwide. Drewry therefore expects spot rates to decline further in the coming weeks.