According to the South China Morning Post (SCMP), ocean container shipping rates have continued to fall by as much as 90% since last year in Shanghai as demand weakens.
The news outlet cited local freight firms reporting that it costs about $2,000 to ship a 20-foot container to the U.S.’s west coast, compared to $20,000 last year’s summer.
Lu Ming, an agent at the Shanghai Ocean Shipping Agency, told the South China Morning Post, “The shipping industry in Shanghai has been so volatile since 2020, and industry officials are worried about the prospects for the market.”
The container freight index tracked by the Shanghai Shipping Exchange has tumbled 45.5% so far this year.
The rate is 80% below the April level when the city was under lockdown due to the Covid outbreak.
Beijing imposes their Zero-COVID policy, requiring forced lockdowns of multiple cities across China. The policy has disrupted the business operations of many sectors, including the shipping industry.
Analysts said that the rate might be going down further. The market prospect is “gloomy,” as an owner of a small freight-forwarding firm in Shanghai told SCMP. “The ocean freights will keep falling, and we do not know where the bottom is.”In 2021, container shipping rates from China to the U.S skyrocketed. Reuters reported that the spot price per container from China to the U.S. east coast had surged more than 500% from a year earlier to $20,804 during the first week of August 2021.