The Freightos Baltic Global index was level overall in February – dipping 2% month on month to $3,351/FEU – but still nearly 2.5x higher than at the end of December 2023 as diversions away from the Red Sea and some pre-Lunar New Year (LNY) demand kept upward pressure on rates.

As Houthi attacks on Red Sea traffic continued in February, despite ongoing US and UK strikes on Houthi positions in Yemen, widespread container carrier diversions away from the Suez Canal have continued.

However, despite the disruption and some capacity and equipment shortages in January that stretched into early February in some Asian origins – with the worst reports coming from some Indian hubs – carriers have managed to avoid significant port congestion at both major origin and destination ports.

However, despite the disruption and some capacity and equipment shortages in January that stretched into early February in some Asian origins – with the worst reports coming from some Indian hubs – carriers have managed to avoid significant port congestion at both major origin and destination ports.

With LNY demand passing and carriers adjusting operations to accommodate the diversions and maintain adjusted schedules, rates passed their peak on some lanes in February and are likely to ease further as ocean freight enters its slow season.

Rates from Asia to North Europe and the Mediterranean declined throughout the month. North Europe rates decreased 17% to $4,553/FEU and to the Mediterranean prices eased by 19% to $5,224/FEU, although each remain nearly triple their levels in February 2019.

Prices for Asia - North America containers slowed their ascent but continued to climb for much of February nonetheless. Rates to the US East Coast increased 9% to $6,709/FEU and Asia - US West Coast prices climbed 17% to $4,809/FEU as some demand may be shifting to the West Coast to avoid diversion impacts. Rates to each coast, though, decreased slightly late in the month, suggesting that prices on these lanes are past their peak.

The diversions’ impact on capacity, equipment availability and ocean prices for non-Red Sea lanes may have reached its summit as well. Transatlantic rates – which had not climbed in December and January – increased 59% in February to $1,862/FEU. However, carriers may not be expecting diversions and market conditions to allow rates to climb much more as some are postponing additional planned surcharges.

Cooling demand and improving operations will likely continue to ease pressure on rates into March. While prices should nonetheless remain above normal levels as long as diversions continue and carriers pass on higher costs, some shipper groups estimate that current rates are significantly outstripping cost increases. 

Cooling demand and improving operations will likely continue to ease pressure on rates into March. While prices should nonetheless remain above normal levels as long as diversions continue and carriers pass on higher costs, some shipper groups estimate that current rates are significantly outstripping cost increases. This assessment – taken alongside continued capacity growth via newbuild deliveries – further points to the likelihood that prices will continue to come down from the highs seen in January and February.

About Judah Levine, Research Lead, Freightos

Judah is an experienced market research manager, using data-driven analytics to deliver market-based insights. Judah produces the Freightos Group's FBX Weekly Freight Update and other research on what's happening in the industry from shipper behaviors to the latest in logistics technology and digitization.


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