As the Asia-ECSA trade is set to establish itself as the world’s hottest trade route in October, unprecedented spot rates - approaching US$4,000 per FEU - moving from Shanghai to Brazil’s port of Santos have surpassed the cost of shipping the same box from Asia to Los Angeles.
Container lines are showing signs of bowing to pressure from the Chinese and US governments to slow the stratospheric surge in spot rates on shipments to ports on the west and east coasts of the US. Still, lines continue to turn up the heat on shippers to South America.
Lines have pushed rates up to levels eight times higher than the US$500 low recorded at the end of June. Effective management of capacity with blank sailings coupled with a return of demand from Brazilian retailers has permitted lines to restore rates to levels of profitability never seen before in the trade.