Drewry, which tracks both ocean contract rates and spot rates, found that average freight rates on the major East-West routes decreased by about 60 per cent in 2023 and are expected to have risen by about 20 per cent in 2024 year on year (YoY).
“Our forecast model for the main scenario of expected US port strikes in Q1 2025 shows that ocean contract rates on routes to the US will rise in 2025, despite the addition of substantial new ship capacity. We also anticipate that spot rates on East-West routes will decline in the second half of 2025,” an article on the company’s website noted.
There have now been four or five years of huge ocean freight rate volatility, according to Drewry, which has cautioned its customers to expect little change in 2025, likely the fifth year in a row of high volatility.
Shippers need to be aware that the shipping industry will continue to be disrupted and there are risks and a need for contingency plans and active vendor management, cautions Drewry.
This year, rates in the spot market appeared to have peaked in July and saw three months of rapid decline, but started rising again in late October.
In the contract market, according to shipper/members of Drewry Benchmarking Club, exporters and importers have had to battle with carriers about requests to accept Red Sea and peak season surcharges.
Shippers need to be aware that the shipping industry will continue to be disrupted and that there are risks and a need for contingency plans and active vendor management, cautions Drewry.
Resilience will require a different way of vetting, selecting and working with ocean carriers or third-party logistics providers and greater attention to assessing and responding to geopolitical risks, it noted.
Fibre2Fashion News Desk (DS)
