Container rates from China have fallen drastically ahead of holidays period in China early October, as shipping companies try to raise rates in an attempt to anticipate a pre-holiday cargo. The rate collapse bodes poorly for market prospects in the coming months, as the slack season will hamper any further rate increases initiatives, according to maritime analysts Alphaliner.
The Shanghai Containerized Freight Index tumbled by 8.1% last week to reach 572 points, only 4.2% above its all-time low of 549 points, recorded in July 2015. Freight rates look set to fall further in the next two weeks, as cargo volumes will dip further in October.
Rate weaknesses was detected across the board, with freight rates close to historical record lows on major key trade lanes, including the routes from China to Europe, to North America, to South America and to Australia. Because of these very weak freight rates, overall carrier profitability is expected to fall down during the second half of this year, even after accounting for the prevailing
low bunker costs.
Despite these dismal market conditions, the German ocean carrier Hapag-Lloyd has re-confirmed plans to list their shares via a partial initial public offering (IPO) on the Frankfurt and Hamburg Stock Exchanges. The company is targeting to raise us$ 500 Million from the IPO, including us$100 Million of new shares for two of its existing shareholders, CSAV and Kϋhne Maritime