Reefer trades have something of a reputation for volatility both in terms of volumes and freight rates, yet Drewry’s Global Reefer Freight Rate Index has recorded only increases over the last 12 months.
Over the past decade, there has been an increasing number of freight forwarders adopting technology. But for the most part, the industry has employed it to improve its internal processes.
In total, the value of all cross-border cargo movement between the US and its NAFTA partners Canada and Mexico fell 3.4% to $1.069 trillion.
Ocean freight rates for cargo moving under contracts on the major East-West trade routes saw a reversal of trend in 4Q 2016, according to Drewry’s Benchmarking Club.
Maersk Line’s average freight rate decreased by 16% year-on-year, but was up 5.5% compared to previous quarter.
France’s CMA CGM, the world’s third-largest container shipping firm, said freight rates should recover next year after a market downturn led to a sharp fall in its third-quarter profits.
Shipping freight rates on the world’s busiest route, from Asia to Northern Europe, fell by the largest percentage amount since 2008, reflecting wild volatility in the market as vessel operators continue to wrestle with overcapacity.
Shipping freight rates, which have hit record lows this year, are set to remain weak for the rest of the decade or longer as there are too many ships and because low fuel prices are capping operating costs, Goldman Sachs said.
Drewry’s Container Annual Review & Forecast 2014/15 emphasises that the recovery of the container industry, when that happens – possibly by late 2016 or 2017 – is to be based around the formation of the new mega alliances and the continued reduction of unit costs, rather than the matching of supply and demand at the individual trade route level.