Volatility of global spot freight rates rose this year, says Drewry

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21 May 2015

 The volatility of global spot freight rates has continued to increase this year over 2014, Drewry Maritime Research has revealed.

Drewry stated that this growth in spot freight rates is based on the assessments on 11 routes gathered by the World Container Index (WCI).

The monthly volatility on Asia to Europe routes has increased 43% on average, in comparison with last year.

"Many non-contract shippers are not currently equipped to cope with huge volatility in their freight costs."

WCI director Richard Heath said: "The two most volatile routes among the 11 we track are Shanghai-Rotterdam and Shanghai-Genoa, with weekly rate increases of $1,000 or more seen during some weeks and monthly volatility of over 40% since the start of this year."

On the WCI composite index, a weighted average of all 11 underlying routes in the first 20 weeks of this year, the monthly volatility has increased by 14%.

When considering all routes, the WCI composite index grew from $2,092 per 40ft container (/40ft) in late February to $1,263/40ft in April. This later increased to $1,611 on 14 May.

Drewry director Philip Damas said: "The World Container Index assessed by Drewry tracks and documents what is an increasingly volatile market.

"The reduction of spot rates is welcome by most shippers, but many non-contract shippers are not currently equipped to cope with huge volatility in their freight costs."

The World Container Index indicates the weekly container pricing index based on actual agreed freight assessments reported by industry firms in Asia, Europe and the US.