Container freight rates on trades out of India have continued to drop in October amid export trade growth challenges, according to an analysis of market data by Container News.
On the westbound India-Europe trade, average spot rates for loads from West India [Jawaharlal Nehru Port (JNPT)/Nhava Sheva or Mundra Port] to Felixstowe/London Gateway (UK) or Rotterdam in April have sunk to US$2,300 per 20-foot container and US$2,500 per 40-foot container, from US$4,100 and US$4,300, respectively, at the end of September.
Similarly, for West India-Genoa (the West Mediterranean) bookings, rates have crashed to US$2,800/TEU and US$3,100/FEU, from US$4,000 and US$4,100, the CN analysis shows.
On the eastbound leg (imports into India), rates from base ports in Europe have also cooled month on month. The analysis put spot rates for bookings from Felixstowe/London Gateway or Rotterdam to West India at US$1,000/TEU and US$1,400/FEU, down from US$1,200 and US$1,500/FEU, respectively, reported at the end of September.
For trades from the West Mediterranean (Genoa) to West India, October rates have ticked up to US$1,150/TEU and US$1,250/FEU, up from US$1,000 per container.
Spot prices on the India-US East Coast trades have further tumbled in October from the highs seen through July. Average rates for shipments from West India (Nhava Sheva/Mundra) to the US East Coast (New York) have nearly halved to US$2,800/TEU and US$3,100/FEU, from US$5,100 and US$5,150 month-on-month. For Indian container loads moving to the US West Coast (Los Angeles), rates have also dropped significantly – down to US$4,250/TEU and US$5,250/FEU, from US$5,250 and US$6,250, respectively, reported at the end of September.
Likewise, for the West India-US Gulf Coast (Houston) trades, average October rates have decreased to US$4,500/TEU and US$4,900/FEU, from US$5,400 and US$5,600, respectively, a month ago, according to the CN analysis.
Rates on the US East Coast-West India trades (return leg) have ticked up month-on-month, hovering at US$970/TEU and US$1,325/FEU, versus US$650 and US$1,000, respectively, in September. From the US West Coast to West India, however, booking rates have moved up to US$1,350/TEU and US$2,000/FEU, from US$1,250 and US$1,900, respectively, a month ago.
Average rates from the US Gulf Coast to West India have seen modest gains from September averages – up to US$1,550/TEU and US$2,200/FEU, from US$1,300 and US$2,000, respectively.
Carrier rates on intra-Asia trades out of India have continued to be in negative territory, on most port pairings, the CN analysis found. For West India-Yantian (South China), the analysis put average rates in April at US$30/TEU and US$40/FEU, and for West India Tianjin (North China), carriers are accepting bookings at as low as US$5/TEU and US$10/FEU.
For West India-Shanghai (Central China) trades, rates have also remained in negative territory, at as low as US$5 per TEU or FEU. Also, for West India loads to Singapore, carriers are accepting bookings at as low as US$5/TEU or FEU.
October rates for West India-Jebel Ali (Dubai) bookings have weakened month on month, to US$450/TEU, from US$550, and US$700/FEU, from US$1,050.
Meanwhile, India’s merchandise export trade by value saw some modest rebounding signs in September, after a sharp fall in August. According to provisional government data, total goods exports by value last month were up 0.5% year-on-year to US$34.58 billion.
The Federation of Indian Export Organisations (FIEO) said market conditions remain challenging for exports due to geopolitical tensions and supply chain disruptions.
“Rising tensions between Israel and Iran have led to logistics challenges as most of our trade to Europe, Africa, CIS [Commonwealth of Independent States] and the Gulf region happens through the Red Sea route or the gulf region,” FIEO president Ashwani Kumar said in a statement.
According to Kumar: “In spite of putting in so much hard work by the exporting community in exports, the challenges about trade finance remains the key for the MSMEs [micro-small-and-medium enterprises] as it is really impacting the competitiveness of Indian products in the global markets.”
FIEO believes: “The urgent and immediate need of the hour is to take steps on the liquidity front with deeper interest subvention support and extension of interest equalisation scheme for at least five years, creating a predictable business environment for the exporters.”
Kumar further noted: “The government should extend the RoDTEP [remission of duties or taxes on export products] benefits to all sectors of exports as available during pre-Covid times.”
The industry group went on to add: “Conclusion of some of the key FTAs [free trade agreements] including with the UK, Peru, Oman and Sri Lanka, should soon see the light of the day, for which FIEO has been urging the government for quite some time now.”
Jenny Daniel
Global Correspondent
Contact email: [email protected]
