Intra-Asia Container Index Remained Stable Last Week
Drewry’s Intra-Asia Container Index (IACI) remained stable at $956 per 40ft container. This halted a five-week decline, as the Middle East crisis continued to weigh on market sentiment, particularly on the Shanghai–Jebel Ali route, where rates rose 6% in Week 31. See detailed commentary below. Five-week slide snaps as Middle East uncertainty grips markets • ...
The Intra-Asia Container Index (IACI), maintained by Drewry, remained unchanged at $956 per 40-foot container last week, ending a five-week downward trend. This stability occurred as geopolitical tensions in the Middle East continued to influence market sentiment, particularly affecting the Shanghai-Jebel Ali route, where rates increased by 6% during Week 31.
Spot rates from key routes to Southeast Asia and South Asia decreased due to waning peak-season demand. For instance, rates from Shanghai to Jakarta fell by 5% to $1,405 per container, while rates to Laem Chabang decreased by 4% to $890, and to Manila dropped by 3% to $447.
The escalation of hostilities in the Strait of Hormuz led to a surge in fuel prices, prompting carriers to potentially introduce emergency fuel surcharges between $38 and $75 per TEU starting August 1. Additionally, typhoons Noul and Bavi have disrupted operations in southern and eastern China, causing prolonged vessel delays. At the Port of Shanghai, average waiting times extended to 77 hours, up from 39 hours in Week 30.
Freight rates are expected to stay stable in the coming weeks as fuel costs may be tempered by decreasing demand. On other trade routes, such as those connecting South Asia and Southeast Asia, spot rates remained steady. Notably, the Port of Mumbai's JNPT faced amplified disruptions from monsoon storms, leading to significant berth schedule issues and vessel backlogs.
COSCO broadened its Northeast Asia network by partnering with Yang Ming's JTS service, enhancing connectivity among Japan, Taiwan, and China. This three-week service rotation extends operations to Nagoya, Tokyo, Yokohama, Keelung, Kaohsiung, Chiwan, and Xiamen.
Despite signs of softening in the intra-Asia container freight market, as the peak season concluded, the index dipped below $1,114 per container after peaking in the third week of June. The Strait of Hormuz's volatility persists due to escalating US-Iran tensions and recent incidents, like the sinking of the 43,000-dwt bulk carrier Luni and the severe damage to the 7,000 TEU container ship GFS Galaxy.
These events have increased security concerns, maintaining cautious market sentiment. Shipping lines are also imposing further bunker adjustment surcharges as WTI crude oil prices rose by 24% month-over-month to $84 per barrel in July. However, any additional regional tensions could further disrupt shipping operations and potentially halt the decline in freight rates.
Written by urgent.news from Hellenic Shipping News's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
