Global demand for ocean freight container shipping hit an all-time record in May amid soaring spot rates and severe port congestion, as the 15.94m TEU transported by ocean in May beats the previous record of 15.72 TEU set in May 2021, according to data released by Xeneta and Container Trades Statistics. The record levels of demand in May brings year-to-date volumes to just under 74m TEU, which is an increase of 7.5% compared to the first five months of 2023.
“More containerized goods are being shipped by ocean than ever before at a time when available capacity is impacted by diversions around Africa due to conflict in the Red Sea and severe port congestion in Asia and Europe," said Emily Stausbøll, Xeneta Senior Shipping Analyst. “This is a perfect storm of pressure on ocean supply chains which has resulted in the chaos of recent months. In many respects it is impressive that global shipping networks have been able to transport this enormous volume of containers under such challenging circumstances.”
The record-breaking level of global demand is largely driven by volumes out of the Far East, with China seeing an all-time-high 6.2m TEU exported in May (including 853,000 TEU of intra-China container demand). This accounts for 39% of global container trade in May and coincided with spiraling spot rates on major fronthaul trades.
The latest data from Xeneta shows average spot rates from the Far East to US West Coast stood at $7840 per FEU on 9 July, up by 200% since 30 April.
Into the US East Coast, average spot rates have increased by 130% in the same period to stand at $9550 per FEU. Into North Europe and the Mediterranean, spot rates have increased by 148% and 88% respectively to stand at $8030 and $7830 per FEU.
From the shipper's perspective the trend is concerning, with spot markets on the rise and no end in site for the Red Sea conflict, and particularly given that the traditional peak season starts in Q3.