Key facts
- Ocean container shipping rates from China to the U.S. East Coast could test record highs.
- Spot rates for a 40-foot container on the Shanghai to New York route have quadrupled since the start of the Iran war.
- The global average price for very low sulphur fuel oil (bunker fuel) hit $901.50 per metric ton on Thursday.
- The Shanghai to New York route is among the busiest and most profitable for global container carriers.
- Drewry's World Container Index Shanghai to New York spot rate peaked at $16,000 early in the pandemic.
Ocean container shipping rates from China to the U.S. East Coast have surged to levels not seen since the COVID-19 pandemic and analysts predict they could reach new record highs. The conflict in the Middle East, involving the U.S. and Iran, has driven up crude oil prices, consequently increasing the cost of bunker fuel used by container ships.
Spot rates on the Shanghai to New York route, a key trade lane, have quadrupled since February 28, reaching $10,948 per 40-foot container, according to data from freight pricing platform Xeneta. Peter Sand, Xeneta's chief analyst, noted that these rates are nearing the all-time high of $11,900 set in January 2022. The global average price for very low sulphur fuel oil, or bunker fuel, rose to $901.50 per metric ton on Thursday, up from $543.50 on February 27, though still below its March peak of $1,053 per metric ton.
Drewry's World Container Index reported that week-over-week spot rates from Shanghai to New York increased by nearly 7% to $10,394 per 40-foot container. Drewry also anticipates that shipments will rise due to the upcoming Golden Week holiday in China, when companies often rush goods out before factory closures. Both Drewry and Xeneta use different methodologies for their spot rate data, which can apply to about half of cargo on the water.