Industry experts have stated that prices in the most volatile segment of ocean shipping are collapsing, but top retailers like Walmart and Home Depot should not expect relief until the spring contract renegotiation season. Spot rates, which cover anywhere from 10% to 40% of ocean container shipments are in free fall as recession looms and the pandemic-fueled US import bubble deflates.
Freight booking platform Freightos made clear that the cost to send a container from Asia to the United States on the demand-sensitive spot market has tumbled more than 80% from its September peak above $20,000 for a 40-foot container.
Major carriers like Mediterranean Shipping Co (MSC) and A.P. Moller-Maersk (MAERSKb.CO) also are expecting delivery of hundreds of new container ships, which amplifies risk as carriers already have more ships than they need to handle shrinking demand.