Pre-Chinese New Year box spike fails to take off, activity subdued

US containerised imports from Asia have seen some increased activity at the start of the year but it pales in comparison to years previously.

 

FreightWaves Maritime market expert Henry Byers opined: "The continued tariff threats from the Trump administration, coupled with an earlier-than-normal Chinese New Year, which officially begins January 25, has likely led many US importers to move much of their volume in 2019.

 

"This means that US container ports are not likely to receive the typical bump in volumes they're used to."

 

If pricing is a rough proxy for demand, Freightos' trans-Pacific indices covering the late 2019-early 2020 period should not rise as much as in prior years, American Shipper reported.

 

A year ago, the index tracking container shipments from China to North American west coast ports such as Los Angeles/Long Beach grew by 26 per cent between January 1 and January 6 2019. Two years ago, rates increased 25 per cent between December 29 2017 and January 2 2018. In contrast, rates have gone up by four per cent between January 1 and January 6 2020.

 

The same pattern prevails with the index tracking prices from China via the Panama Canal to US east coast ports such as New York/New Jersey. A year ago, this index increased by 22 per cent between January 1 and January 6 2019; two years ago, by 32 per cent between December 18 2017, and January 2 2018; and this year, by six per cent between January 1 and January 6 2020.

 

According to Freightos chief marketing officer Eytan Buchman: "Chinese New Year is spurring demand, but not like in past years. The final run-up [to the holiday], combined with carriers' concerns of recouping some of their IMO 2020 fuel costs, has pushed rates up. But 2019's story of the year - the trade war - continues in 2020 and has dampened pre-Chinese New Year demand as well."

 

Source:HKSG GROUP

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