Global demand for ocean container shipping hit a record high in May, driven by soaring spot freight rates and severe port congestion.
The 15.94 million TEUs shipped by sea in May broke the previous record of 15.72 million TEUs set in May 2021, according to data released by Xeneta and Container Trade Statistics.
The record level of demand in May brings year-to-date freight volumes to nearly 74 million TEUs, up 7.5% compared to the first five months of 2023.
"More containerized cargo is being transported via oceans than ever before, at a time when available capacity is being impacted by the conflict in the Red Sea and severe congestion at ports in Asia and Europe," said Emily Stausbøll, senior shipping analyst at Xeneta.
"It has been a perfect storm of pressure on ocean supply chains, leading to the disruptions of recent months. In many ways, it is impressive that the global shipping network has been able to move such a large volume of containers in such challenging circumstances."
The record level of global demand has been driven in large part by export volumes from the Far East, with a record 6.2 million TEUs exported in May (including 853,000 TEUs of intra-China container demand). This accounted for 39% of global container trade in May, and at the same time, spot rates on the main ocean trades have been spiraling higher.
The latest data from Xeneta, a sea and air freight rate benchmark and intelligence platform, shows that the average spot freight rate from the Far East to the US West Coast was $7,840 per FEU on July 9, up 200% since April 30.
On the US East Coast, average spot prices have risen 130% over the same period to $9,550 per FEU. In Northern Europe and the Mediterranean, spot prices have risen 148% and 88% to $8,030 and $7,830 per FEU, respectively.
“Given that we have seen record volumes in May ahead of the traditional peak season in the third quarter, you can understand why shippers are so concerned,” Stausbøll added.
“The spot market is still climbing, the conflict in the Red Sea shows no sign of ending, and the port congestion we are seeing in Asia and Europe will take time to ease the pressure.
“The big question facing the market is whether the record volumes in May will mean fewer volumes in the traditional peak season. There are a number of factors at play, not only underlying consumer demand, but also nervous shippers bringing forward imports and the possibility of further tariffs on Chinese imports.
“While this combination is likely to keep demand high for the coming months, there is certainly a limit to how long record demand levels can last.” ”Global demand for ocean container shipping hit a record high in May, driven by soaring spot freight rates and severe port congestion.
The 15.94 million TEUs shipped by sea in May broke the previous record of 15.72 million TEUs set in May 2021, according to data released by Xeneta and Container Trade Statistics.
The record level of demand in May brings year-to-date freight volumes to nearly 74 million TEUs, up 7.5% compared to the first five months of 2023.
"More containerized cargo is being transported via oceans than ever before, at a time when available capacity is being impacted by the conflict in the Red Sea and severe congestion at ports in Asia and Europe," said Emily Stausbøll, senior shipping analyst at Xeneta.
"It has been a perfect storm of pressure on ocean supply chains, leading to the disruptions of recent months. In many ways, it is impressive that the global shipping network has been able to move such a large volume of containers in such challenging circumstances."
The record level of global demand has been driven in large part by export volumes from the Far East, with a record 6.2 million TEUs exported in May (including 853,000 TEUs of intra-China container demand). This accounted for 39% of global container trade in May, and at the same time, spot rates on the main ocean trades have been spiraling higher.
The latest data from Xeneta, a sea and air freight rate benchmark and intelligence platform, shows that the average spot freight rate from the Far East to the US West Coast was $7,840 per FEU on July 9, up 200% since April 30.
On the US East Coast, average spot prices have risen 130% over the same period to $9,550 per FEU. In Northern Europe and the Mediterranean, spot prices have risen 148% and 88% to $8,030 and $7,830 per FEU, respectively.
“Given that we have seen record volumes in May ahead of the traditional peak season in the third quarter, you can understand why shippers are so concerned,” Stausbøll added.
“The spot market is still climbing, the conflict in the Red Sea shows no sign of ending, and the port congestion we are seeing in Asia and Europe will take time to ease the pressure.
“The big question facing the market is whether the record volumes in May will mean fewer volumes in the traditional peak season. There are a number of factors at play, not only underlying consumer demand, but also nervous shippers bringing forward imports and the possibility of further tariffs on Chinese imports.
“While this combination is likely to keep demand high for the coming months, there is certainly a limit to how long record demand levels can last.” ”