FBX Index May 2024: Market summary

The Freightos Baltic Global index fell 9% month-on-month in April to $2,384/FEU, as rates continued to ease from the pre-Lunar New Year and early Red Sea diversion-driven highs of January and February. As the decline has slowed, however, prices may be reaching their new floor as long as Red Sea diversions continue to absorb excess capacity, with the global benchmark still 79% higher than in April 2019.

Rates from Asia to N. America West Coast ended April at $3,095/FEU for a 15% dip compared to March, with prices still double those seen in 2019. To the East Coast, rates fell 19% to $4,262/FEU and are 60% higher than in 2019. Rates to both coasts are more than 35% below their February highs.

East Coast rate declines reflect that the Baltimore bridge collapse at the end of March did not significantly disrupt regional operations, with alternative ports like Norfolk and NY/NJ able to absorb rerouted volumes smoothly. Other welcome news for East Coast shippers this month included the Panama Canal Authority’s announcement that it will further ease low-water restrictions into June, pushing daily transits up to 32, and increasing the maximum draft level.

Prices from Asia to N. Europe were stable for much of April, closing 3% higher than March at $3,365/FEU, still 150% above 2019 levels. Rates to the Mediterranean were likewise stable, dipping 6% to $4,256/FEU and remaining nearly triple 2019 levels. Prices to both regions are more than 25% below their January peaks.

Carrier rate announcements for May on these lanes show some intend to keep prices at current levels, suggesting a new Red Sea-driven floor. Others will introduce GRIs of about $1,000/FEU, although many are sceptical that these will succeed without significant capacity reductions during the current slow season.

The Iranian seizure of an MSC vessel in the Strait of Hormuz represented yet another risk for container flows this year. Though so far an isolated event, if actions like this continued or Iran chose to close the strait, Middle East container traffic, including sea-air volumes to Dubai could be significantly disrupted, with possible congestion at Indian hubs that serve Middle East routes.

Transatlantic rates rose 5% in April to $1,745/FEU owing to some reports of improved demand and following on knock-on effects from Red Sea diversions that may have also helped push rates up since the start of the year from their loss-making $1,200/FEU level they maintained for much of the second half of last year.
Source: Freightos