container freight rates across global trades rose over 50% in the year to Q2,
matching gains made in dry cargo pricing, and are estimated to increase further
in Q3, outpacing dry box rates, according to a new report from British
Drewry warns that some stabilisation is
already underway on some reefer trades and this is expected to be followed by
modest declines through 2023, as cargo owners push back on unsustainable
freight rate increases.
Global Reefer Container Freight Rate Index, a weighted average of rates across
the top 15 reefer intensive trade routes, rose 50.4% year-on year in Q2 and the
Q3 reading is expected to climb further, though the pace of growth will slow.
However, east-west routes have seen only modest freight rate increases over the
last four quarters, as capacity pressure has eased thanks to the softening pork
trade from both Europe and North America to Asia.
The reefer supply chain is at a
“The reefer supply chain is at a precarious moment
with extremely high input costs for materials such as fertilizer, packaging and
energy, to name just a few. Freight rates remain unsustainably high and many
BCOs, particularly those moving low value products, are shipping less as they
are priced out of the market”, said Drewry’s head of reefer shipping research
“The next round of freight rate negotiations
between carriers and cargo owners are expected to take heed of this reality,
leading to a modest decline in reefer freight rate levels through 2023.”
the present uncertainty, Drewry expects seaborne reefer trade growth to
accelerate over the coming years, to expand at an average annual rate of 3%
over the years to 2026
“Despite fears of a global slowdown in
trade, supply chain disruption is expected to remain a feature well into 2023,” added Gray.