Could a decrease in sea freight tariffs finally be on the horizon?
21 July 2022
It has been all over the logistics media over the last few weeks: After years of rising sea freight tariffs, a change seems afoot. Tariffs have been dropping almost all of this year. Even now the peak season is here, the decrease is persistent. What are the expectations for the rest of the year? Let’s look at the facts and possible obstacles.
Facts and figures
Reason for the optimism in the media is the well-known ‘World Container Index-tracking Indicator’ by analyst firm Drewry. This data shows that the sea freight tariffs have been going down since the end of the Chinese New Year. There is already a difference of around 20% compared to the sea freight tariffs a year ago.
Particularly remarkable here is that the decrease is persistent even in the run-up to the peak season – we usually see a steep rise in tariffs at this time. The average sea freight tariff for a 40ft from Shanghai to Rotterdam dropped by 2% in the first week of July compared to the previous week. It is expected that the sea freight tariffs will decrease even more from August.
Possible bottlenecks and expectations
Circumstances are and will remain to have a particular impact on the tariffs. The rigorous lockdowns in China we are by now familiar with will continue to pose a specific and realistic threat. We should also stay alert for (other) external circumstances, such as terminal workers taking strike action. Now that congestion has become an all-encompassing issue in European ports, the possibility of these strike actions cannot be discounted.
In short, it is impossible to predict how the tariffs will move. Any new bottlenecks in the supply chain play a major role in this. If none arise, it seems further decreases in the sea freight tariffs will have the green light.
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