Container Market Sentiment Signals Rebound: A ‘Shipper’s Market’ this Peak Season

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Container Market Sentiment Signals Rebound: A ‘Shipper’s Market’ this Peak Season

August 16th, 2023 Container xChange Leave a comment

Container xChange, an online container logistics platform, published its August Container Market Forecaster today. Despite the ongoing market fluctuations, the Container Price Sentiment Index (xCPSI) has exhibited resilience and witnessed growth in July as compared to the month of June. The forecaster also noted that container prices have been relatively stable over the past 30 days (July) as compared to the previous 90 days (May-July).

Container Price Sentiment Index (xCPSI) by Container xChange

The Container Price Sentiment Index (xCPSI) conducts market surveys concurrently and distils industry experts’ collective insights about container price trends into a quantitative measure, providing insight into near-future expectations for the container market dynamics. In July, 2,570 supply chain professionals participated in the survey.

While the opinion is varied, still most respondents (42%) foresee an increase in container prices in the near-term which is indicative of potential market improvement, 28% foresee a further decline in container prices, suggesting a certain degree of pessimism in market conditions. 30% of those surveyed maintained that prices would remain unchanged.

This growth in sentiment underscores the industry’s anticipation of an imminent turnaround, contributing a sense of positivity to the landscape.

Container Industry Stabilizing Amidst Market Fluctuations

Average container prices have been relatively stable in the last 30 days as compared to the price volatility over the past 90 days (30 days – July, 90 days – May-July).

Analyzing a 30-day price delta comparison across key regions, the market has witnessed average price fluctuations ranging from -4% to +5.20% in the month of July 2023. However, the container prices have experienced a visible dip over a 90-day period, with Southeast Asia reporting a substantial -15.73% decline from May to July 2023.

Despite this sustained dip, the sentiment index has stayed strong, even growing in July. The alignment of sentiment and pricing trends suggests an industry outlook that foresees a turning point, shifting away from skepticism towards a shared anticipation of market recovery despite ongoing price adjustments.

Region-wise Container price volatility, Source: xChange Insights

Asian ports have been witnessing steady changes in average container prices for 40 HC cargo-worthy containers. For shippers, engaging in container trading or leasing within Southeast Asia at present, compared to three months prior or even just one month ago, presents a viable business prospect.

These average prices for 20 ft cargo worthy containers (region-wise) as of 9th August 2023 is illustrated in the graph below.

Region-wise average prices for 20 ft cargo worthy containers

Carrier Capacity Management Spur Intra-Asia Trade Surge

According to Fitch Ratings, in the second quarter of 2023, China witnessed a 6% year on year increase in total container throughput, a significant improvement compared to 3% growth in first quarter of 2023. This expansion was primarily propelled by intensification of trade under the Regional Comprehensive Economic Partnership (RCEP), introduction of new foreign trade routes at the Dalian port, and upward trajectory of trade with nations participating in the Belt and Road Initiative.

A surge in demand for containers on Intra Asia trade lanes was observed on the platform, for example, the China to India stretch was popular in the month of July on Container xChange.

Here are the top five stretches for both the 40 HC and 20 DC containers Ex China on xChange Insights as on 10th August 2023 –

40 ft HC	20 ft DC
China to India	China to United States
China to Russian Federation	China to India
China to China	China to Russian Federation
China to United Arab Emirates	China to Canada
China to Belarus	China to United Arab Emirates

Leasing charges for 40 ft HC containers on stretches Ex-China are amongst the top 10 stretches on xChange Insights indicating a bounce back from low leasing pick up charges over the last months.

Leasing charges for 40 HC containers on prominent trade stretches

Indications from Drewry point towards Asia’s entry into a peak season, resulting in a notable 42% surge in the Shanghai-Los Angeles spot rate over a four-week period concluding on August 3rd. Simultaneously, the Drewry Shanghai-Rotterdam index also saw a 20% upswing within the same duration.

Due to increased trade between India and the wider Asian region, ocean carriers are adding more capacity on the Intra-Asia trade route. This is also propelled by the sourcing diversification strategy in South Asia, particularly in countries like Vietnam and India. The aim is to increase shipment volumes and improve market presence. These changes in strategy allow these companies to optimise their operations and potentially strengthen their market position. This is important in a dynamic and competitive shipping industry.

United States: A potential Industry Rebound

The Global Ports Tracker forecasts, provided by NRF (National Retail Federation), indicate that import cargo volumes are poised to reach their peak in August 2023. This surge aligns with retailers’ preparations for the winter holiday season stocking.

Real GDP increased at an annual rate of 2.4% for the April-through-June period, after rising 2% in the first quarter this year, surpassing expectations and delaying concerns of a recession.

The S&P Global Flash US Manufacturing PMI posted 49.0 in July, up from 46.3 in June indicates market improvement. A decrease of 0.5% in wholesale inventories also indicates that the inventories are becoming leaner in the US.

“As economists shift from predicting recession to a ‘soft landing’, the industry holds its momentum. While some experts remain cautious, the foundation of a resilient economy, sustained consumer activity, and strategic federal investments improves the outlook of the upcoming holiday season.” shared Christian Roeloffs, cofounder and CEO, Container xChange.

“It’s a shipper’s market this peak season as rates stabilize at below pre-COVID levels and capacity is abundant. Prices are low and this offers a great opportunity for exporters this peak season.” Roeloffs added.

Eurozone Emerges from Technical Recession: A Turning Tide

In the second quarter of 2023, seasonally adjusted GDP increased by 0.3% in the euro area and was stable in the EU, compared with the previous quarter, according to a preliminary flash estimate published by Eurostat, the statistical office of the European Union. In the first quarter of 2023, GDP had remained stable in the euro area and had increased by 0.2% in the EU. Therefore, avoiding a technical recession in Eurozone.

“Although we did avoid a technical recession in the Eurozone, retail trade is down by 0.3%, along with high inflation rate. These high prices will continue to exert pressure on operating costs for shipping companies. Carriers and freight forwarders should anticipate rising expenses related to provisioning ships and providing for crew members. Shippers might also experience increased costs for transporting goods, affecting overall supply chain costs.” Commented Roeloffs.

“Short-term shipping demand may experience a boost, especially for routes connected to countries with stronger growth rates like Ireland and Spain. However, the potential for growth to be less robust than expected warrants cautious optimism. Prepare for potential shifts in shipping demand as companies explore more cost-efficient transport options during uncertain economic periods.” Added Roeloffs.

The shipping industry’s course for the next few months is intricately woven with economic shifts, trade dynamics, and supply chain adaptations. As we approach the holiday season, the industry’s resilience and adaptability will be put to the test.

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73% of Supply Chain Professionals Predict Chaos on Cards due to Early Chinese New Year and COVID Infections in China

January 27th, 2023 Container xChange Leave a comment

A larger share of freight forwarders and supply chain professionals this year in 2023 are expecting disruptions owing to COVID outbreaks in China and the Chinese New Year factory closures as compared to the last year (2022).

“We are looking at three different Chinese Years in 2020, 2021 and 2022. It’s not what we’ve been accustomed to in the prior years when there was demand leading up to the Chinese New Year. There is a lot of inventory with retailers and manufacturers. Inflation and fear of recession continue to impact demand. And therefore, the spot rates have started to fall off the cliff. There are a lot of unknowns and preparing with better data, information and visibility into the supply chain is the way to navigate through these unforeseen times.” said Cathy Morrow Roberson, Founder and President of Logistics Trends & Insights LLC during a webinar organised by Container xChange on the Chinese New Year analysis and predictions.

The annual Chinese New Year survey by Container xChange witnessed some 2300 respondents from the supply chain industry sharing their opinions and views about how they view Chinese New Year and COVID outbreaks in China to have an impact on global supply chains.

As compared to some 66% in 2022, there was an increase in the percentage (73%) of supply chain professionals expecting Chinese New Year to further disrupt the shipping industry this year. This comes in contrast to industry reports where a lot of analysis talks about lessening the impact of disruptions in China on the global supply chains. Out of the 73% saying that they do foresee an impact, 65% were freight forwarders and rest were supply chain professionals in general.

“Usually, we expect cargo rush in January and February but this year, the Chinese New Year is earlier. The situation will have a significant impact on domestic supply chain after January 15 till February 6, 2023. In my opinion, this time is difficult for businesses. I think companies can prepare better through controlling costs, better forecasting, and efficient information flow. This is where technology can help greatly.” commented Mr. Sun Director / General Manager, CNTRANS in the webinar.

When asked in the survey, ‘what impact will be the most prominent in the coming weeks’, most agreed that there will be ‘an increase in port congestions and delays’ and ‘delayed container journeys’ soon after China reopens. Last year, most industry professionals feared capacity issues and higher rates as the Chinese New Year aftermath. One respondent elaborated, “I think an ‘increase in port congestions and delays’ and ‘delayed container journeys’ will be the possible result as it makes sense to me that once they all ship out again that means more ships leaving closer to one another for the same destinations which may cause backups for a short time.”

“There are added, and new complexities ahead coupled with Chinese New Year where at one end we see China coping with the Covid infections, and on the other end we see continued dip in demand. We cannot see Chinese New Year in isolation but in combination with all these challenges. The biggest concern is the reduced production and port capacity due to the infections in China. Also, the rates are low, capacity management is still top priority for carriers and blank sailings are prominent. Amidst this, in the coming weeks, we do foresee prolonged factory closures and bearish market conditions.” said Christian Roeloffs, cofounder and CEO, Container xChange, an online container logistics platform that offers an ecosystem for booking and managing of shipping containers.

We also asked how the industry is planning for the closures. We asked – “In planning for the 2023 Chinese New Year factory closures, have you ordered inventory/placed bookings earlier this year?”

Last year, in the year 2022, 59% said ‘yes’ and this year, 55% said yes. While the majority planned advance bookings, there is a drop of 4%. Another change we noticed this year was, while 65% international freight forwarders said they expect Chinese New Year closures to impact supply chains, only 47% have made advance plans to deal with the same. One possible cause of the dip in preparing in advance could be still high inventory levels—and the market being bearish in general, as demand continues to fall and transportation capacity supply increases.

Further, we asked ‘Ahead of Chinese New Year factory closures, have you changed your container sourcing strategy to ensure you have boxes?’ Last year in 2022, majority said nothing specific and this year too, the majority responded by saying nothing specific, only this year, highlighting that there is enough supply.

About Container xChange

The container is one of the most impactful innovations in history—using standardization to power globalization and lift billions of people out of poverty. But contrary to the standardized container itself, most processes in container logistics have not been standardized nor innovated — and are still frustratingly complex, manual and error-prone. Combined with thin margins, this makes it difficult for logistics businesses to survive and thrive.

Container xChange is the leading online platform for container logistics that brings together all relevant companies to book and manage shipping containers as well as to settle all related invoices and payments.

The neutral online platform…

connects supply and demand of shipping containers and transportation services with full transparency on availability, pricing and reputation,
simplifies operations from pickup to drop-off of containers,
and auto-settles payments in real-time for all your transactions to reduce invoice reconciliation efforts and payment costs.

Currently, more than 1500+ vetted container logistics companies trust xChange with their business—and enjoy transparency through performance ratings and partner reviews. Unlike limited personal networks, excel sheets and emails you rely on, Container xChange gives its users countless options to book and manage containers, move faster with confidence and increase profit margins.

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88% of Supply Chain Leaders Surveyed Fear “Inflation and Recession will be the Biggest Factors that will Impact Businesses in 2023”

January 11th, 2023 Container xChange Leave a comment

Container xChange released today the Container LogTech predictions report for 2023 which highlights important global trends that the shipping and supply chain industry will witness in 2023. The report draws attention to some of the most pertinent issues that industry will witness this year thereby helping professionals to prepare better for navigation.

“The overall outlook for the year 2023 for the supply chain industry remains challenging. Europe is hit hard with all-time high inflation; China struggles to cope with the virus and the US continues to witness hinterland transportation challenges and labor unrest. Most of these challenges will stay in 2023. Consumer confidence will pick up, but it really depends on whether we witness more disruptions in the coming times.” said Christian Roeloffs, cofounder and CEO, Container xChange, an online container logistics platform.

Most of the experts surveyed foresee that inflation and recession will have a greater impact this year and will be the biggest driver of disruptions.

‘‘Due to inflation increasing, there’ll be more unrest in the labor market which will certainly lead to more strikes, specifically in Europe, the UK and North America. And as we have seen before, strikes result in slow operations within the port which can exacerbate supply issues.’’ said Aamir S. Mir, Chief Operating Officer (COO), Caspian Container Company SA as part of the interviews.

Talking of rates, the report further predicts that the Long-term shipping contract rates will see an uptick in 2023, though gradually. This slow increase applies to all modes of transport. With negotiations going on to bring contract rates in line with spot rates, a reset is expected. On the other hand, until there is a balance reached between supply and demand, forwarders will favor short-term contracts until the rates stabilize. “Freight forwarders will employ a ‘wait and see’ approach before making any long-term air cargo capacity commitments particularly.” the report claims.

Trucking rates for both dry and reefer cargos will continue to drop in 2023. Freight tonnage will continue to contract as market conditions and volumes return to pre-pandemic numbers.

The unresolved worker strikes of 2022 will spill over in 2023. Furthermore, the chances of new strikes coming up are high due to inflation-related rise in prices putting pressure on workers’ disposable incomes. Labor dissatisfaction might grow in European and North American economies. In that case, it will cause disruptions in global supply chains.

‘‘Two, almost three exceptional years for carriers are definitely coming to an end. They will have to adapt back to lower margins due to a different supply and demand balance. Many customers, forced into high-cost contracts during the up-cycle, will come for revenge in the down cycle. And regulatory pressures, following excessive profits might appear on top of that, be it through bodies like FMC, EU or China’s MOC, as they each reviewing alliance exemptions, new taxation regulations, or precedence cases from several complaints raised by shippers at different institutions.’’ said Ruben Huber, Founder and Director, OceanX.

The report further covers the growing expectation of 3PL (third party logistics) market to solidify in 2023. Reportedly, it’s projected to reach $1,789.74 billion by 2027. Another key trend on the list is around the digital transformation of the industry. In the years to come, the adoption of digital technologies in shipping will focus on vessel schedules, intuitive booking interfaces, instant slot booking, and capacity confirmations. In this regard, the industry’s major concern will be on having systems interact directly via automating the Data-Analysis-Decision-Action cycle.

About Container xChange 

The neutral online platform…

connects supply and demand of shipping containers and transportation services with full transparency on availability, pricing and reputation,

simplifies operations from pickup to drop-off of containers,

and auto-settles payments in real-time for all your transactions to reduce invoice reconciliation efforts and payment costs.

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As COVID Resurges in China, Industry Leaders Convene to Prepare and Predict the Impact of the Chinese New Year this Year on Shipping, Trade and Supply Chains

January 10th, 2023 Container xChange Leave a comment

Container xChange, an online container logistics platform, is hosting a free for all webinar to discuss and predict the impact of the Chinese New Year on China’s manufacturing industry, labor availability and on trade. The webinar is scheduled on Thursday, 12 January 2023, at 13:00 CET.

The eminent panel of speakers includes Cathy Morrow Roberson, Founder and President of Logistics Trends & Insights LLC, Mr. Sun, Director / General Manager @ CNTRANS and Christian Roeloffs, cofounder and CEO, Container xChange

“The infections in China and their impact on the supply chain is a very pertinent topic for many containers logistics and supply chain professionals in the industry. We know that traditionally the Chinese New Year halts the production and movement of containers for two long weeks (minimum) in China and the impact is generally felt for weeks after across the trade lanes. What we hear from the ground is that the consumer demand is considerably low and hence the impact of a shutdown in China is going to be limited as compared to the last year(s). But we believe it is difficult to predict and therefore, demands a closer look at the data and the market scenario.” said Christian Roeloffs, cofounder and CEO, Container xChange.

“We bring a panel of experts to talk about how the Chinese New Year will impact trade and supply chain in China and for the rest of the world. We are hopeful that such discussions bring clarity to the industry professionals,” he added.

The official public holiday for Chinese New Year only lasts a week and is scheduled this year for January 22 -28, 2023. However, in most previous years factory output in China has been impacted for far longer as many workers take extended holidays.

At the webinar, the panel will cover the predictions on how Chinese New Year will play out this year and how the industry can prepare for the coming times keeping in mind the resurgence of COVID infections in China.

About Container xChange 

The neutral online platform…

connects supply and demand of shipping containers and transportation services with full transparency on availability, pricing and reputation,

simplifies operations from pickup to drop-off of containers,

and auto-settles payments in real-time for all your transactions to reduce invoice reconciliation efforts and payment costs.

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Faster Inventory Replenishment Cycles Expected in 2023; Depot Space to Remain Tight and Operational Costs to Remain Elevated

December 30th, 2022 Container xChange Leave a comment

The holiday season, now at its peak, is going to trigger an early burn-out of inventories in the US, which resultantly will kickstart the inventory replenishment cycles a bit sooner than the supply chain and shipping industry predicted earlier this year. This would cause an increase in demand the export hubs as the US starts to work on balancing its order-to-inventory ratio, as discussed in a recent webinar hosted by Container xChange, the leading online container logistics platform for container trading and leasing globally.

The webinar shed light on some of the pertinent challenges faced by the container logistics industry worldwide and discussed some of the market trends likely to appear in the industry.

Global trade is undergoing an opportune shift in supply chain reliance on China to newer emerging SE markets as the country tightens its zero covid policy and struggles with increasing labor costs amidst other market disruptions. Furthermore, China has grown out of the low-cost countries (LCC) label, which has made way for other southeast Asian countries like India, Singapore, Vietnam, and Malaysia to mark their presence into multinational companies’ long-term regional presence imperative.

Predicting how the trade volume shift might look like in 2023, Mr. Eric Johnson, Director at S&P Global and Senior Technology Editor at JOC.com said, “There is an evident drop in trade between China and the US and the UK, and one of the major trends that have caught the attention of the supply chain and shipping industry is that imports from China to the US and UK have gone down. However, import volume into the US as a whole from all regions hasn’t gone down at the same rate as from China specifically which strongly corroborates the trade shifting elsewhere.”

Companies globally are focusing on creating regional alternatives to curb supply chain disruptions cropping up due to high labor costs, fresh lockdowns in the country and protests in the country.

With the dramatic fall in consumer demand, and with more containers available, the spot rates on transpacific routes between some countries in East Asia and the US have dropped drastically as well.

The spot rate of a 40 ft container in the China-West Coast route fell by 20% to $2,361 in October. The typical premium rate a year back was $20,000. Across the Atlantic, shippers in the US have witnessed a 20% dip in ocean freight orders, and ocean carriers have cancelled half of their sailings to make sure that their vessel’s capacity matches the demand.

One-way pickup charges for standard containers from China to North America are declining month on month since May 2022 from $1773 to $344 in October. (One-fifth of what it was in May)

One-way pickup charges from China to Europe declined from $2845 in January 2022, to $1726 in May 2022 and further to $910 in October

One-way pickup charges declined by 80% from $1773 in May to $344 in October over the past 6 months at the China-North America stretch, and a 47% decline on the China-to-Europe stretch

China continues to see a fall in freight rates

According to Container xChange platform data, the average container prices and one-way leasing rates in October 2022 on Asia to the US East Coast and the West Coast were respectively 63% and 85% lower than the rates in October 2021. However, while the rates have dropped dramatically in 2022, if we compare them with the rates in October 2019 instead, the drop is not as surprising.

“The supply chain is already in distress with a surplus of containers, maxed out depot space and an increase in blank sailings. The Zero covid strategy and the geopolitical and trade risks in China will further contribute to the drop in demand for containers in China.” said Christian Roeloffs, cofounder and CEO, of Container xChange.

However, it also means that the demand will slowly stabilize and get closer to the level at which it was before the pandemic started. We also expect the capacity re-adjustments to continue. Especially in the Trans-Pacific Lane, the demand will continue to decline. In fact, by November end, West Coast spot rates might even drop below $2,000.” Christian added.

Container xChange’s data shows that not just has the price of the containers decreased but there also is a drastic decline in the pickup charges. The average one-way pickup (PU) rates for 40 ft HC boxes from China to the US have seen a steep decline since June 2022 from $2,109 in May to a surprising $606 in September.

CAx (Container availability Index) * values are much higher than pre-pandemic – meaning that the inbound containers are significantly higher at the Chinese ports than the imported boxes this year as compared to 2019 (pre-pandemic) and since then. This indicates that there are not as many containers leaving the ports from China which is now obvious and evident considering the uncertainties looming onto the China shipping business.

Countries and businesses show candor towards minimizing dependence on linear supply chains

“We will continue to see efforts towards diversification of supply chain sourcing and manufacturing out of China. This is a long-term view, and it will need vision and strategy from companies looking for a more resilient supply chain. We will witness increased container volumes intra-Asia and more countries will emerge as potential alternatives like Vietnam, India and more. In such an environment where there will be tighter margins for freight forwarders and traders, the cost is going to be everything. Leaders will look for ways to efficiency and business sustenance.”

Comparing the container prices in the Southeast Asian countries with that of China, the container prices are considerably lower in Indonesia, Thailand, Malaysia, Singapore, Vietnam and India than that China which corroborates well with the SE countries being opted as China plus one alternative.

Container xChange Platform Data

The concepts of “minimization of logistics risks” and “diversification of supply chain” are not new. Countries and businesses are working harder than ever to eliminate their supply chains’ excessive reliance on just one market. As part of a China plus one strategy, businesses are currently assessing and launching projects to test the waters by entering into fresh countries to meet their supply chain demands.

The speed of this diversification is actually closely correlated with the additional disruptions we will observe in China as a result of numerous variables, including the Zero COVID plan, additional production shutdowns, and escalating geopolitical tensions. If they happen more quickly, diversification will follow suit.

About Container xChange

Container xChange is a technology company that offers a container trading and leasing platform, payment infrastructure and efficient operating systems to container logistic companies worldwide. Covering the entire transaction process of shipping containers starting with finding new partners to tracking containers and managing payments, xChange makes using 3rd party equipment as easy as booking a hotel. We are on a mission to simplify the logistics of global trade.

Being one of the top ten logistics tech companies globally, xChange is fundamentally transforming thousands of processes involved in moving containers globally. xChange is trusted by more than 1000 container logistics companies including Kuehne+Nagel, Seaco or Sarjak that use our neutral online platform to remove friction and create economic opportunity.

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Container xChange Opens the Real-Time Data Door to Container Trading and Leasing Price Data with its New Solution

December 27th, 2022 Container xChange Leave a comment

In a bid to bring real-time container data accessibility, Container xChange, an online container logistics platform, has launched “xChange Insights”, a first-of-its-kind data-based solution for container traders, freight forwarders, shippers, and NVOCCs worldwide. This recent addition to the company’s product suite brings container market transparency by providing global container intelligence to support container logistics companies make smart trading and leasing decisions.

To understand the market pain points better, Container xChange polled over 250 container traders, freight forwarders, and NVOCCs and found that more than half (57%) of those surveyed spent over two hours finding real-time data on container prices and leasing rates. The poll also found that 44% of the shipping and container trading companies research and then analyse the procured data daily. This increases the manual workload on the professionals in the industry. Insights will solve this problem by giving access to real-time data and automating the process.

“Real-time price and leasing rates analysis is a challenge for many container logistics players due to the market’s slow adoption of technology. With technology penetrating deeper into the supply chain processes, it is time that we use big data for better decision-making. Most freight forwarders and container traders rely on their own experience or advice coming from established partnerships when judging business opportunities or exploring a new market. We simplify the access to data so industry participants can complement experience and offline knowledge with the latest facts when making decisions.”, said Dr. Johannes Schlingmeier, co-founder and CEO of Container xChange.

xChange Insights enables logistics companies to see and compare current container prices and SOC leasing rates in 130 locations around the globe, learn about price development for up to 2 years and make data-informed decisions. For example, whether it’s a good time to buy, sell or lease containers and what are the most lucrative cities for trading and leasing deals. The platform also highlights the latest trends, and relevant news, and provides guidance on main markets.

“’To address the container logistics market transparency issue and provide objective market data, we collect and analyse data from various sources: Container xChange marketplaces, container sellers and shipping lines. This information is then shared with our customers in an aggregated and convenient manner so that everyone can better understand the container pricing volatility and dependencies and derive better conclusions. We also plan to integrate even more data types and sources to further support our clients in developing their businesses.” adds Dr. Schlingmeier.

Welcor Containers, a global container trading company based in Uruguay, South America was able to create market opportunities using xChange Insights for its business. Talking about this, Bruno Kent, Head of Logistics, Welcor Containers said, “xChange Insights help us to enter the European trading market with confidence. We use Insights every day to check container prices and supply availability across Europe!”

About Container xChange 

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Depots to Face the Brunt of Container Surplus well into 2023

November 24th, 2022 Container xChange Leave a comment

The industry is witnessing a major slump in the order-to-inventory ratio with high inventories but slower demands. According to the November edition of the Container xChange Forecaster, this leaves a rippling effect across different stages of container logistics.

One of the glaring issues which will impact container repositioning and container movement well into the year 2023 is insufficient depot space.

“There is just not enough depot space to accommodate all the containers. With the further release of container inventory into the market (e.g., from the disposal of leasing fleets), there will be added pressure on depots in the coming months. This will be a key challenge for some and a competitive advantage for others in the business, especially in China because of the empty container repositioning there”, inferred Christian Roeloffs, cofounder and CEO, of Container xChange, the online container logistics platform.

Talking about the impact of hinterland disruptions and de-fleeting of shipping lines in the coming times, Andrea Monti, CEO at Sogese who also owns container depots in different locations in Europe commented during the Digital Container Summit in October, “Whatever was coming in and out of, for instance, our Milan depot is quite stuck. And the container volume at the depots is increasing to an extent that we are returning some requests for depot service agreements. We are in a situation where we are not able to accept new clients for some locations.”

This peak season, which has technically not happened this year, retailers and companies are more cautious in their stock management strategy as they adjust to the shorter cargo delivery cycle.

“There is enough inventory with retailers. Once these inventories exhaust in North America and Europe, companies will order again, and demand for shipping capacity will pop back up. This won’t go back to max pandemic levels but certainly be back to the long-term average upward trend. What has happened now is that the cargo is “on time” again and hence you’ll see a slowdown in new ordering as companies adjust to this more efficient turnaround times in ocean freight delivery.”

“For container owners, this could potentially mean a rise in container storage fee by depots as more containers pile up to disincentivize longer staying containers at the depots.” said Dr. Johannes Schlingmeier, cofounder and CEO, Container xChange

The latest monthly logistics report by Container xChange ‘Where are all the containers’ echoed interesting testimonies on the market situation.

The average container prices (for trading) and one-way pickup charges (for leasing) for standard containers declined to their lowest in two years in China. These were at $3711 in October in China, declining further (so far) in November.

One-way pickup charges for standard containers from China to North America are declining month on month since May 2022 from $1773, to $344 in October. (One-fifth of what it was in May)

One-way pickup charges from China to Europe declined from $2845 in January 2022 to $1726 in May 2022 and further to $910 in October

One-way pickup charges declined by 80% from $1773 in May to $344 in October over the past 6 months at the China-North America stretch, and a 47% decline on the China-to-Europe stretch

“The declining rates and container prices indicate a weakening demand and surplus of containers. The wider this gap, the lower the container rates and prices. The logistic companies have already moved onto the planning for Chinese New Year because of the weak peak season this year”, further added Roeloffs.

Average container prices fell by 9% from $3609 in September to $3286 in October in the US

Average prices declining in Europe

Average prices freefall in Asia

Rising imbalances in supply and demand for containers, rising empty container repositioning to Asia and tighter depot space will be topics for attention well into the year 2023.

A majority of those polled by Container xChange in the month of October echo that the freefall of container prices is NOT an indicator of global economic normalization well into 2023. Clearly, the industry is not upbeat about the supply chain getting back on track.

About Container xChange

Container logistics is plagued by intransparency and mistrust. And contrary to the standardized container itself, most processes in container logistics have not been standardized nor innovated — and are still frustratingly complex, manual and error-prone. Combined with thin margins, this makes it difficult for logistics businesses to survive and thrive.

The neutral online platform…

connects supply and demand of shipping containers and transportation services with full transparency on availability, pricing and reputation,
simplifies operations from pickup to drop-off of containers,
and auto-settles payments in real-time for all your transactions to reduce invoice reconciliation efforts and payment costs.

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Shippers Still Find Ocean Freight Booking for Shipper Owned Containers (SOCs) Challenging

November 22nd, 2022 Container xChange Leave a comment

Digital adoption challenges leading to a lack of transparency, visibility and trust emerge as three key struggles for container logistic companies to book shipper-owned containers according to a survey by Container xChange, an online platform for container logistics and operations.

To examine the pain points of the current state of ocean freight booking, Container xChange joined hands with the Copenhagen Business School and surveyed with 137 freight forwarders and NVOCCs spread across the globe.

While the majority of freight forwarders shippers and NVOCCs use online quotation solutions, 83% find the need for better digital infrastructure in the future, pointing to digital vessel schedules and intuitive booking interfaces as the most impactful digital transformations in times to come.

Christian Roeloffs, co-founder and CEO, of Container xChange, shared that, “Lack of transparency and standardized digital processes has fueled inefficiency and mistrust for a very long time in the logistics industry. These struggles are further worse for shipper-owned containers where no carrier takes care of processes. This hinders the adoption of SOCs in the market. The survey corroborates with the state of the industry at present, but it is encouraging to understand how so many players are looking forward to Digital vessel schedules and intuitive booking interface for instance.”

“With the adoption of digital tools, all of this could be streamlined in a manner that there is a standardized procedure for all users. With digitization being at the crux of the whole booking cycle, the industry could become more efficient with streamlined vessel schedules, intuitive booking process, avoid scammers and gain trust in counterparties with vetted partners.” Roeloffs added.

Compared to Carrier-owned Containers, Shipper-owned Containers in principle provide more flexibility and can help users avoid hefty fees like demurrage and detention. However, the market has yet to fully adapt to SOCs in the same way as COCs when it comes to digital solutions. SOCs, being a fairly new concept, don’t have digitized slot booking processes and have a huge opportunity to connect to the fragmented ocean freight marketplace.

When it comes to ocean freight slot booking, Shipper-owned container users struggle more with getting accurate quotations, and confirmations of available capacity and end up booking with 5-10 shipping or feeder lines since there is no schedule reliability. Whereas Carrier-owned container users do have the liberty of getting administrative tasks like trucking, offloading, unstuffing, and so on taken care of and have digitized slot booking solutions in place, plenty of players still conduct the process manually with loads of emails and phone calls.

The main findings of the survey were:

More than 70% of the respondents find a lack of trust in their counterparts

Out of all the companies surveyed, 83% of them ranked digital vessel schedules on an importance level of 4 or 5, while 77% ranked intuitive booking interface in the same way. But industry players also want to have their document checklist and uploads visible and easy to use, as well as operational contact information ready at hand.
We observed that 84% of our participants still source quotations via email and phone, while 78% of them use the same outdated processes to place a booking.
At the same time, the fact that 60% also use online quotation solutions such as shipping companies’ online booking interface (e.g., Maersk’s platform) shows that a market for digital SOC ocean freight booking exists.

The ocean freight market is still walking the old roads with slow manual processes. To get quotations and bookings, the industry still struggles with swift and easy processes. Outdated and manual processes also remain prevalent with companies still carrying out bookings via e-mail and phone.

For the slot booking process, instant booking and capacity confirmations were deemed the most important. And yet, many players are below satisfied with said service they receive.

Working on digital solutions to streamline the industry pain points, Adrian Degode, Senior Product Engineer, at Container xChange said, “The shipping industry is becoming increasingly digital but the biggest thing missing is trust. The caveat remains to be bringing all the solutions under one platform that simplifies the lifecycle of ocean freight spot booking while ensuring trust and transparency.”

“To enable the industry with an end-to-end solution, Container xChange is building a dynamic Ocean Freight Marketplace with transparent rates and trustworthy partners for Shipper-Owned Containers, where users get guaranteed slots on the vessel and supplier-guaranteed payments. From getting up-to-date vessel schedules and freight rates for your shipping routes to choosing and booking the best offer from trustworthy partners within minutes, the platform will bring a wide array of capabilities.”, he added.

Key findings of the survey

From quotation to booking, 40.9% of companies regularly place bookings with 5-10 shipping or feeder lines
When choosing a carrier, schedule reliability (77%), capacity availability (80%) and fast quotation (69%) were found to be the most important
In the quotation process, trust in counterparts (70%) also ranks as important, while satisfaction in this category is low-medium
To get both quotations and bookings, email and phone are still used as the main medium (75-85% of the time)

In the booking process, instant booking (76%) and capacity confirmation were deemed most important (79%), but currently, up to 32% of respondents are not satisfied with those two capabilities in existing solutions.
When booking online, digital vessel schedules (83%) and an intuitive booking interface (77%) were evaluated as the two most important factors overall

About Container xChange 

The neutral online platform…

connects supply and demand of shipping containers and transportation services with full transparency on availability, pricing and reputation,

simplifies operations from pickup to drop-off of containers,

and auto-settles payments in real-time for all your transactions to reduce invoice reconciliation efforts and payment costs.

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Shipping Lines and Container Owners in the US Struggle to Return Empty Containers to China

September 20th, 2022 Container xChange Leave a comment

Shipping lines and container owners in North America (majorly in the US) are finding it difficult to return containers to China. To add to the present challenges, the US is also facing major trucking issues that are making cargo movement within the country difficult.

The US is again in the spotlight according to the monthly container logistic report published today by Container xChange, a technology marketplace and operating platform for container logistic companies.

“What is happening in the US is that there is already congestion, like every year, because it is the peak shipping season, and everyone is trying to make sure that retailers have enough inventory on the shelves for the upcoming holiday and Christmas season. The US West coast labor negotiations due to which many freight forwarders rerouted the cargo to the US East Coast have now caused congestion on the US East coast too. Hinterland complications like acute shortage of truckers and rail delays are adding to the woes. All in all, there are many challenges that will impact a smooth container movement into the peak season.” said Christian Roeloffs, cofounder and CEO, Container xChange

“Empty containers piling up at the depots in the US and containers stuck on the sea (owing to the congestion) will contribute to capacity being tied up.”

“On the supply side, there is an excess of containers while due to recessionary fears and inflation, the consumer demand has softened. Nonetheless, we are sliding into the peak season, and this is the busiest season of the year. The average container prices traditionally increase in China and Southeast Asia during the peak shipping season, and we do expect to see a rise in the prices in the coming weeks. In the mid-term, what could possibly change this year is the relatively smaller degree of increase in average container prices owing to several disruptions.”

According to the report published today, the average container prices for cargo-worthy containers of all types in the region rose from $2116 in July to $2214 in August.

The ports on the US East Coast and West Coast are experiencing an increase in average container prices, while these average container prices are declining worldwide.

In North America, the US saw a 7.3% increase in per month trading prices for cargo-worthy containers of all types – this refers to the percentage difference in comparison to the previous month. Canada, on the other hand, saw a 15.28% dip.

(Slide 12 of Where are all the containers report Download here)

“This situation of empty containers piling up in the US and in the Europe will lead to tighter depot space, carriers will rush to get rid of their older equipment, and second-hand container prices will continue to slide.”

Container Availability Index (CAx) at record highs

While globally the supply chain disruptions were slowly easing up, there is still no sure end to shipping troubles in sight. In week 35, the US ports including Houston, Oakland, New York City, Savannah, Long Beach, and Los Angeles kept up their high CAx scores (above 0.80) from last month (while the ideal balance level is at 0.50 meaning the same number of containers are moving out as are moving in at a given port. If this index number rises, then it means there are more containers coming in than going out). While the congestion seems to be easing in the ports on the west coast, container movement in the US faces many problems before it improves.

“The lockdowns in China will further make the situation difficult for shippers and freight forwarders to move the cargo from China to the US. Much chaos on the cards coming winters.”

About Container xChange

Container xChange is a technology company that offers a container trading and leasing platform, payment infrastructure (for transparent and easier payment handling) and efficient operating systems to manage the end-to-end container movement across the globe for container logistic companies worldwide. Covering the entire transaction process of shipping containers starting with finding new partners to track containers and managing payments, xChange makes using 3rd party equipment as easy as booking a hotel. We are on a mission to simplify the logistics of global trade.

Being one of the top ten logistics tech companies globally, xChange is fundamentally transforming thousands of processes involved in moving containers globally. xChange is trusted by more than 1000 container logistic companies such as Kuehne+Nagel, Seaco or Sarjak that use xChange every day to improve operational effectiveness and improve productivity.

Monthly Container Logistics Report

Our monthly report ‘Where are all the containers’ gives visibility into actionable data and insights into the container logistics industry to make informed decisions for container movement across the globe. Our analysts and subject matter experts across the globe study various container market fluctuations, and their impact on container prices, leasing rates and container availability to deliver insights that could be used for a better understanding of what’s happening in the container logistics space. We track millions of containers to bring these actionable insights to our customers and partners. This equips them with market intelligence which is at the core of our vision to simplify the logistics of global trade.

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One-Way Leasing Rates Skyrocket in India by 200% Amid Peak Shipping Season

September 7th, 2022 Container xChange Leave a comment

Container shortage, rising average container prices, and 200+% rise in one-way pickup rates are just a few disruptions awaiting exporters and shippers in India at a time when the peak shipping season typically begins globally (July-August), according to the monthly container logistics report titled ‘Where Are All The Containers’. published today by Container xChange, a technology marketplace and operating platform for container logistic companies.

India has withered the rising global disruptions with more resilience than many other countries. However, the ripple effect of disruptions caused well over the past two years has caused significant market and container imbalances in the Indian shipping industry.

“India has been at the forefront of digitalization, e-commerce and capacity building for containerized trade. The country has displayed resilience and agility at a time when the world is looking for a China plus one diversification strategy. The country has a vast coastline, and this gives it a very good opportunity to expand its shipping economy. However, there are many roadblocks, hinterland transportation being one, cost of containers being another. Our platform always shows Indian ports as one of the costlier ports. This is also because there are many charges that make the movement of containers costlier from India.”

“On a global scale, the important factor to consider is that there is not so much need for increasing the container fleet further. In fact, in another analysis, we studied that there will soon be an oversupply of containers worldwide. What is more important is to develop an infrastructure that attracts companies to conduct containerized trade in and through India. This will involve three key investments – digitalization of container trade, infrastructure for transportation and bringing about efficiency and transparency in operational processes and charges. What requires more attention than ever is the creation of solutions that add to the standardisation of shipping logistic operations. What India needs is a set of alternate mechanisms which can help expand port capacity and can then bring down the logistics costs”, said Christian Roeloffs, Cofounder and CEO, of Container xChange.

“However, India’s decision to expand its container manufacturing will come on an opportune time. Expanding domestic manufacturing will help ease the strain and make containers available for other nations despite containers being stuck at western countries and China.” Roeloffs added.

According to the report, there is a steep increase in the average container prices and one-way leasing rates in the month of July 2022. July is a crucial month for the shipping industry because this time period marks the beginning of the peak shipping season.

Average Container prices for cargo-worthy boxes in India rose significantly since the pandemic

Indian ports have been appearing in the costliest top 10 lists for both 20 ft DCs and 40 ft HCs as per the report. For 20 ft DCs, average prices rose by 61.15% from $900 in July 2020 to $2317 in July 2022. Whereas for 40 HCs, average container prices increased by 57.34% from $1800 in July 2020 to $2317 in July 4220.

However, the average trading prices for these boxes, for cargo-worthy 20DCs, the prices in Mundra, Nhava Sheva, and Chennai fell marginally to land at $2384, $2362, and $2356.

But for cargo-worthy 40HCs, the trading prices fell steeper at the ports of Mumbai and Mundra. The prices fell by 5.51% for Mumbai ($3773) and 8.85% for Mundra ($3605). The drop in prices at Chennai was 3.83% as the 20DCs were trading at $3969. At Nhava Sheva, the average price for a cargo-worthy 20DC was $3918.

As the sailing disruptions followed by container shortages continue this year, many shipping lines have skipped India port calls to maintain schedule integrity. This has subsequently affected the demand and has further led to a gradual yet marginal decline in average prices for cargo-worthy containers.

For more information on container prices, availabilities and one-way rates, please download the full report from here – https://www.container-xchange.com/reports/monthly-container-logistics-update/

About Container xChange  

Container xChange is a technology company that offers container trading and leasing platform, payment infrastructure and efficient operating systems to container logistic companies world-wide. Covering the entire transaction process of shipping containers starting with finding new partners to tracking containers and managing payments, xChange makes using 3rd party equipment as easy as booking a hotel. We are on a mission to simplify the logistics of global trade.

Being one of the top ten logistics tech companies globally, xChange is fundamentally transforming thousands of processes involved in moving containers globally. xChange is trusted by more than 1000 container logistic companies such as Kuehne+Nagel, Seaco or Sarjak that use the neutral online platform every day to remove friction and to create economic opportunity.

Container Market Sentiment Signals Rebound: A ‘Shipper’s Market’ this Peak Season

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