The latest data released by Xeneta, a maritime market analysis platform, shows that the XS1 index of US imports in April rose slightly from March, but is still down more than 50% since April 2023; The European XSI index has risen sharply, but is still down more than 34% from December. Xeneta Senior analyst Emily Stausøll believes that the sharp rise in the European XSI index is mainly attributed to the geopolitical conflict in the Middle East. Spot rates from the Far East to the Mediterranean are up more than 60 percent this year from last year, which normally underpins new annual contract rates. However, container companies have not raised contract prices significantly this year because of concerns about excess capacity in an uncertain market.
At present, the container market is undergoing a new round of annual contract negotiations, and relevant companies recently said that in the annual contract negotiations on the trans-Pacific route, shippers and carriers have a large difference in the expectations of freight rates.
It is understood that since the second quarter of 2023, the delivery of newly built container ships has reached a record high. At the same time, the Red Sea crisis has eased fears of overcapacity, with most ships rerouted to the Cape of Good Hope. However, if the Red Sea route returns to normal within the next 12 months: shipping companies will face the risk of overcapacity, spot rates could plummet.