Container Freight Rates Hit Record High for 6 Consecutive Weeks... Nearly $9,000 for Trans-Pacific Routes

Containers are piled up in the yard of Busan New Port 4th Pier, waiting to be loaded.

[Asia Economy Reporter Dongwoo Lee] Container freight rates have approached the 3750 level, setting a new all-time high once again. In particular, freight rates on the trans-Pacific eastbound route have risen for 11 consecutive weeks, nearing the $9,000 mark.

According to the shipping industry on the 19th, the Shanghai Containerized Freight Index (SCFI), which aggregates freight rates across 15 container shipping routes, rose by 44.43 points from the previous week to 3748.36. This is the highest level since the index began in October 2009, breaking records for six consecutive weeks.

Freight rates on the trans-Pacific westbound route, a major route for domestic exporters, reached $4,716 per 1FEU (12-meter container), up $58 from the previous week. Notably, during the same period, freight rates on the trans-Pacific eastbound route surged by $360 to $8,914 per 1FEU, marking the largest increase and setting a new all-time high.

The rise in freight rates on the trans-Pacific eastbound route is attributed to ongoing congestion on the westbound route, leading many vessels to bypass via the Panama Canal to the east coast, causing prices to continuously increase. While congestion at major west coast ports such as Long Beach and Los Angeles (LA) has somewhat eased, it is expected to take more time to return to normal operations.

Freight rates on the Asia-Europe route, which surpassed $6,000 per 1TEU (6-meter container) for the first time last week, recorded $6,351, down $4 from the previous week. During the same period, the Mediterranean route rose by $120 per 1TEU to $6,392, setting a new record high again.

The Asia-South America route increased by $177 to $9,297 per 1TEU, and the Asia-Middle East route rose by $65 to $3,002 per 1TEU, surpassing the $3,000 mark for the first time. The Australia-New Zealand route also rose by $116 to $2,395.

The continuous rise in container freight rates is due to a surge in global cargo volumes since COVID-19, causing congestion at major ports and delays in cargo movement due to confirmed cases among port workers. Shipping experts predict that container ship freight rates will continue to rise through the third quarter of this year, with the SCFI freight index surpassing the 4000 level and setting a new all-time high.