West coast ocean spot market rates increased $593 (51%) to $1,746 on September 2, while east coast rates increased $757 (45%) to $2,441. The dramatic jump in spot market rates was driven by the August 31 receivership filing of Hanjin Shipping, the South Korean ocean carrier accounting for 8% of eastbound Transpacific trade volume and the 7th largest ocean carrier in terms of total capacity. Spot rates also spiked on July 1, with west coast rates up 61% and east coast rates up 19% in anticipation of August general rate increases. Rates had drifted slightly lower since the July 1 increase until the current spike. With two significant spikes, west coast spot rates are $290 (20%) above prior year levels and at their highest point since May 2015. East coast spot rates remain $231 (9%) lower than prior year despite two significant jumps over the summer.

The spread between east and west-coast ports declined from a peak of $2,937 on 2/27/15 to $682 on 12/25/15, then immediately jumped back up to $1,037, but had since declined to $531 on 8/26 before jumping up to $695 after the Hanjin filing. The premium drops below $1,000 at some times, but typically not for very long. This year has been an exception as the spread has been below $1,000 for most of the year.Carrier’s clearly exercised their market power during the strike as shippers diverted freight to the east coast, but now even after recent increases, spot rates have corrected to levels considerably lower than those preceding the strike.

The SCFI reflects spot market rates for the Shanghai export container transportation market.

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West coast ocean spot market rates increased $64 to $852 on June 3, while east coast rates increased $63 to $$1,685. East and west coast spot market oceans rates both rose for the second consecutive period but remain very low compared with historical levels. There was an extraordinary spike on 12/31/15, when west coast rates ($1,518) jumped 98% and east coast rates ($2,555) jumped 76%, but since then rates have trended down significantly. Both rates remain slightly higher than they were just before the year-end spike.

The spread between east and west-coast ports declined from a peak of $2,937 on 2/27/15 to $682 on 12/25/15, then immediately jumped back up to $1,037, but has since declined to $833 on 6/3. There is not likely to be much more convergence as the premium drops below $1,000 at some times, but typically not for very long. Carrier’s clearly exercised their market power during the strike as shippers diverted freight to the east coast, but now spot rates have corrected to levels considerably lower than those preceding the strike.

The SCFI reflects spot market rates for the Shanghai export container transportation market.

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West coast ocean spot market rates fell $121 to $884 on March 4, while east coast rates fell $179 to $$1,804. East and west coast spot market oceans rates have dropped off significantly from the extraordinary spike on 12/31/15, when west coast rates ($1,518) jumped 98% and east coast rates ($2,555) jumped 76%. Spot rates remain volatile but are still at far lower levels than at the conclusion of the west-coast port strike. East coast rates are down 62% while west coast rates are down 54% year-over-year. From the peak rate of $5,049 per FEU on February 13, 2015, east coast rates have fallen 64% to $1,804, a drop of over $3,200. The west coast peak was the same week at $2,265 per FEU. Those rates have dropped about the same on a percentage basis (61%) to $884, a drop of about $1,400.

The spread between east and west-coast ports has declined from a peak of $2,937 on 2/27/15 to $920 on 3/4/16. There is not likely to be much more convergence over very many weeks as the premium drops below $1,000 at some times, but not for very long. Carrier’s clearly exercised their market power during the strike as shippers diverted freight to the east coast, but now spot rates have corrected to levels considerably lower than those preceding the strike.

The SCFI reflects spot market rates for the Shanghai export container transportation market.

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East and west coast spot market oceans rates have dropped off somewhat from the extraordinary spike on 12/31/15, when west coast rates jumped 98% and east coast rates jumped 76%. Spot rates remain volatile but are still at far lower levels than at the conclusion of the west-coast port strike. East coast rates are down 49% while west coast rates are down 33% year-over-year. Prior to the year-end spike, east coast rates were at levels not seen since December of 2009, while west coast rates were near the low point of the last five years.  From the peak rate of $5,049 per FEU on February 13, 2015, east coast rates have fallen 52% to $2,420, a drop of over $2,600. The west coast peak was the same week at $2,265 per FEU. Those rates have dropped less (39%) to $1,377, a drop of about $900.

The spread between east and west-coast ports has declined from a peak of $2,937 on 2/27 to $1,043 on 1/22. There could be modest continued convergence as the premium has been less than $1,000 at some times. Carrier’s clearly exercised their market power during the strike as shippers diverted freight to the east coast, but now spot rates have corrected to levels considerably lower than those preceding the strike.

The SCFI reflects spot market rates for the Shanghai export container transportation market.

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Source: Shanghai Containerized Freight Index – Shanghai Shipping Exchange, The Journal of Commerce, Transplace analysis.

East and west coast spot market oceans rates remain volatile but at far lower levels since the conclusion of the west-coast port strike. East coast rates are down 44% while west coast rates are down 34% year-over-year. After a brief uptick, East coast rates are now at levels not seen since December of 2009. West coast rates have not declined as quickly since the recent uptick, but still remain near the low point of the last five years.  From the peak rate of $5,049 per FEU on February 13, east coast rates have fallen 52% to $2,427, a drop of over $2,600. The west coast peak was the same week at $2,265 per FEU. Those rates have dropped less (39%) to $1,379, a drop of about $900.

The spread between east and west-coast ports has declined from a peak of $2,937 on 2/27 to $1,048 on 9/18. The spread has not been this low since November of 2012. There could be modest continued convergence as the premium has been less than $1,000 at some times. Carrier’s clearly exercised their market power during the strike as shippers diverted freight to the east coast, but now spot rates have corrected to levels considerably lower than those preceding the strike.

The SCFI reflects spot market rates for the Shanghai export container transportation market.

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East and west coast spot market oceans rates have fallen sharply since the conclusion of the west-coast port strike. East cost rates are down 26% while west coast rates are down 34% year-over-year. East coast rates are now at lows not seen since late 2011 while west coast rates are lower than any seen in the last five years.  From the peak rate of $5,049 per FEU on February 13, east coast rates have fallen in all but two weeks and are now 47.8% below peak at $2,635, a drop of over $2,400. The west coast peak was the same week at $2,265 per FEU. Those rates have dropped by a very similar 48.1% to $1,175, a drop of about $1,100.

The spread between east and west-coast ports has declined from a peak of $2,937 on 2/27 to $1,460 on 7/17. The spread has not been this low since May of 2014. There could be continued convergence as the premium has been less than $1,000 at some times. Carrier’s clearly exercised their market power during the strike as shippers diverted freight to the east coast, but now spot rates have corrected to levels lower than those preceding the strike.

The SCFI reflects spot market rates for the Shanghai export container transportation market.

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Source: Shanghai Containerized Freight Index – Shanghai Shipping Exchange, The Journal of Commerce, Transplace analysis

East coast spot market oceans rates have risen sharply due to west-coast port issues. East cost rates are up 37% while west coast rates are down 6% year-over-year. There has been significant week-to-week volatility but the increase in east-coast spot market rates in the last 8 months is significant. The major shipping lines continue to have greater pricing power to east coast ports than west coast ports as the spread between east and west-coast ports has grown extremely large. The Shanghai Containerized Freight Index (SCFI) for west coast ports was $1,979 per FEU and to east coast ports was $4,683 on January 30.

Prior-year comparisons highlight the pricing disparity between the coasts as west-coast rates are down $129 (6%) over 2014 and east-coast rates are up $1,257 (37%). The disparity between the coasts had been fairly consistent in the first half of 2014, but spot prices to the east coast spiked primarily due to diversions from west coast ports. The SCFI reflects spot market rates for the Shanghai export container transportation market.

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Source: Shanghai Containerized Freight Index – Shanghai Shipping Exchange, The Journal of Commerce, Transplace analysis – See more at: http://devblog.transplace.com/default.aspx#sthash.20F5khlm.dpuf

Spot market oceans rates rose sharply last few week, with west-coast rates up 19% and east coast rates up 8%. There has been significant week-to-week volatility as rates had declined in each of the previous two weeks, but the increase in east-coast spot market rates in the last 6 months is significant. The major shipping lines continue to have greater pricing power to east coast ports than west coast ports as the spread between east and west-coast ports remains large. The Shanghai Containerized Freight Index (SCFI) for west coast ports was $2,259 per FEU and to east coast ports was $4,363 on December 12. Prior-year comparisons highlight the pricing disparity between the coasts as west-coast rates are up $559 (33%) over 2013 and east-coast rates are up $1,401 (47%). The disparity between the coasts had been fairly consistent in the first half of the year, but spot prices to the east coast spiked as volumes have risen due to both peak-season shipping and diversions from west coast ports. The SCFI reflects spot market rates for the Shanghai export container transportation market.

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Despite west-coast port labor issues, ocean spot rates have not risen significantly in the last few months. There has been significant week-to-week volatility, but the down weeks have offset the up weeks. In addition, the major shipping lines continue to have greater pricing power to east coast ports than west coast ports as the spread between east and west-coast ports remains large. The Shanghai Containerized Freight Index (SCFI) for west coast ports was $1,905  per FEU and to east coast ports was $4,078 on November 28. Prior-year comparisons highlight the pricing disparity between the west coast and east coast ports as west-coast rates are up $137 (11%) over 2013 and east-coast rates are up $1,073 (38%). The disparity between the coasts had been fairly consistent over the past year, but spot prices to the east coast spiked as volumes have rose due to both peak-season shipping and diversions from west coast ports. The SCFI reflects spot market rates for the Shanghai export container transportation market.

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The major shipping lines continue to have greater pricing power to east coast ports than west coast ports. Spot rates to the east coast have moderated from the recent peak, but the spread from west-coast ports remains large. The Shanghai Containerized Freight Index (SCFI) for west coast ports was $2,109 per FEU and to east coast ports was $4,119 on October 24. Prior-year comparisons highlight the pricing disparity between the west coast and east coast ports as west-coast rates are up $378 (22%) over 2013 and east-coast rates are up $1,006 (32%). The disparity between the coasts had been fairly consistent over the past year, but spot prices to the east coast have spiked as volumes have risen due to both peak-season shipping and diversions from west coast ports. The SCFI reflects spot market rates for the Shanghai export container transportation market.

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