In September 2023, the Chinese export container transportation market failed to continue its previous upward trend and showed an overall adjustment trend. The lack of further growth in transportation demand has led to a slight decline in the composite index, as most ocean route market rates have fallen from their high levels at the beginning of the month. According to data released by the National Bureau of Statistics, the profits of industrial enterprises above designated size increased by 17.2% year-on-year in August, marking the first positive monthly profit growth for industrial enterprises since the second half of last year. At the same time, China's manufacturing PMI has been rising for three consecutive months, and the level of manufacturing prosperity has further improved. With a series of macroeconomic policies being introduced one after another, the marginal improvement of major economic indicators and economic expectations continue to improve. In September 2023, the average value of the China Export Container Comprehensive Freight Index released by the Shanghai Shipping Exchange was 876.46 points, a decrease of 0.5% from the average of the previous month; The average Shanghai Export Container Composite Index, which reflects the spot market, is 956.03 points, a decrease of 7.4% from the previous month's average.

1. The port container throughput continues to grow, and the ship leasing market continues to adjust
① In August 2023, major ports in China maintained good operations, with container throughput continuing to grow. The throughput of coastal and inland ports also maintained growth, with inland port throughput growth exceeding 10%. According to statistics, the container throughput of ports in China reached 27.46 million TEUs, an increase of 6.7% compared to the same period last year. Among them, coastal ports completed a container throughput of 23.96 million TEUs, an increase of 6.1% year-on-year; The inland port completed a container throughput of 3.5 million TEUs, an increase of 11.5% year-on-year.
② The container rental market continues to adjust, with rental prices for various types of ships continuing to decline. According to Clarkson's statistics, in September, ship rents for 1000TEU, 2750TEU, 4400TEU, 6800TEU, and 9000TEU decreased by 3.3%, 1.9%, 9.3%, 13.2%, and 11.2% respectively compared to the previous month.

2. European freight rates continue to decline
According to data released by S&P Global, the initial manufacturing PMI for the Eurozone in September was 43.4, lower than previous values and market expectations. Due to weakened demand leading to further decline in economic activity, the Eurozone economy may shrink in the third quarter, and the sluggish economy is also beginning to drag down trade performance. According to customs data, in US dollars, China's exports to the European Union in August decreased by 19.6% year-on-year, which has put some downward pressure on the consolidation market. This month, transportation demand has been weak, supply and demand balance is not ideal, and market freight rates have continued to decline since the beginning of the month. Towards the end of the month, transportation demand did not experience a small peak in shipments before the National Day holiday, and the market continued to decline. In September, the average freight index for China's exports to Europe and the Mediterranean routes was 1048.09 points and 1442.50 points, respectively, a decrease of 3.4% and 5.7% compared to the previous month's average.

3. Adjustments in the North American market
On the North American route, according to data released by S&P Global, the initial comprehensive PMI for September in the United States was 50.1, lower than previous values and market expectations, reaching the lowest level since February this year. Among them, the manufacturing PMI has shrunk for the fifth consecutive month, and the service industry has reached its lowest level since January this year. US companies issued a signal of widespread output stagnation at the end of the third quarter, and manufacturers and service providers have shown weak demand. In addition, inflation remains high, prices hover at high levels for a long time, and borrowing costs continue to rise, leading to consumer suppression of spending levels and dragging down future economic recovery. This month, transportation demand has not continued its previous positive performance, supply and demand fundamentals have begun to weaken, and market freight rates have not been able to maintain the previous price increase results. Since the first half of the month, the overall trend has been adjusted. In September, the average freight index of China's exports to the West and East routes of the United States was 767.52 points and 894.12 points, respectively, an increase of 2.3% and 0.3% compared to the previous month. The average freight rates for Shanghai Port's exports to the US West and East basic ports, which reflect the spot market, were $1916/FEU and $2635/FEU, respectively, a decrease of 4.5% and 13.9% compared to the previous month.

4. The Australian and New Zealand market continues to rise
The demand for various materials in the Australian New Zealand route continues to grow, and the supply and demand relationship is steadily improving. The market freight rates have continued to rise this month. In September, the average freight index for China's exports to Australia and New Zealand routes was 711.12 points, an average increase of 15.4% compared to the previous month.

5. South American freight rates have slightly declined
On the South American route, there is a lack of further growth in transportation demand, and the supply and demand relationship is poor, leading to a downward trend in market freight rates. In September, the average freight index for Chinese exports to South America was 672.22 points, a decrease of 4.7% compared to the previous month.

6. Japan's freight rates have slightly increased
On Japanese routes, transportation demand remains stable, and market freight rates have slightly increased. In September, the average freight index for Chinese exports to Japan was 787.31 points, an increase of 0.9% compared to the previous month.

Source: Shanghai Shipping Exchange