Drewry: Asia-Southern Africa Rates at 7-Year High
The Asia to Southern Africa market has witnessed a significant growth as spot rates reached their highest in seven years, according to shipping consultancy Drewry.
Instead of an earlier expected 13% decline in southbound volumes in the first quarter, Container Trade Statistics (CTS) is now reporting marginal growth of 0.4% for the same period, representing an additional 22,400 TEU on the original numbers.
Southbound shipments increased by 8% in the second quarter, representing the fastest rate since the second quarter of 2013.
After six months the headhaul southbound market was up by 4.3%, well on course to record the first significant annual gain since 2013.
Drewry said that freight rates are expected to continue their ascent in this growing trade over the coming months, while new capacity would be supported by greater volumes.
“Indicative of a strengthening market carriers are adding capacity to the southbound trade with effective southbound slots estimated to have been up by 15% year-on-year in July. Further additions that appear on schedules for August and September will raise that annual comparison yet again,” according to the shipping consultancy.
The strength of the recent demand recovery has contributed to a recovery in ship utilisation and freight rates. Southbound load factors were in the high-70s in May and June and “should go higher still in the traditionally stronger second half of the year, even with the extra capacity.”