Container freight rates on East Asia-Southeast Asia routes have been weakening since March 2020, as the impact of the Covid-19 pandemic on supply chains and industrial output has materialised.
The pandemic began in late January 2020, but there was a time lag between then and the increasing lockdowns across the world.
The Shanghai Shipping Exchange showed that as of 24 April, freight rates between Shanghai and Singapore averaged US$165/TEU, a US$14 drop from the previous week. A US$16 drop was seen in rates between Shanghai and Thailand’s Laem Chabang port, with rates averaging US$172/TEU. Over the same period. Freight rates between Shanghai and Vietnam (Ho Chi Minh) fell US$21 to US$167/TEU.
Sources from South Korean liner operators told Container News that shipments to Thailand suffered as Covid-19 disrupted production in Japanese carmakers’ Thai plants.
Anticipating a slowdown in vehicle sales, Mazda and Toyota are among Japanese carmakers that have paused production in Japan and Thailand.
According to Korea Customs, in the first quarter of 2020, container trade between South Korea and eight Southeast Asian countries totalled over 1,005,000TEU, compared with 980,500TEU in the same period in 2019.
Exports dipped by 0.4%, to 514,200TEU, while imports were up 5.8% to 491,300TEU.
Volume contraction ranged from 5% to 15% for container trade with Hong Kong, Singapore, Thailand and Indonesia.
On a positive note, Korea Customs stated that South Korea’s container trade with Malaysia went up by 21% to 138,700TEU, while South Korea’s container trade with Taiwan and the Philippines were up 15% to 113,100TEU, and 10% to 62,700TEU, respectively. Box trade with Vietnam was up 1%, to 294,600TEU.
Martina Li
Asian Correspondent
