Long-term ocean freight rates see unprecedented rally: Xeneta

May saw the highest ever monthly increase - 31 percent - in long-term contracted ocean freight rates, according to data from Xeneta.

"The unprecedented hike, revealed in the latest Xeneta Shipping Index (XSI®) Public Indices for the contract market, means that long-term rates are now up 150.6 percent year-on-year. In 2022 alone, costs have increased 55 percent."

Xeneta CEO Patrik Berglund says: "This is a staggering development. Just last month, we were looking at a 11 percent rise and questioning how such continued gains were possible. Now, we see a monthly increase of almost a third, blowing the previous XSI® records out of the water. The breathtaking gains reflect the sharp increase of the average of all valid long-term contracts as the older contracts with lower rates expire, and are replaced by the newer contracts with much higher rates. It's a worrying time to be a shipper, and halcyon days for the carrier community even as the market has started showing signs of slowing down."

US imports/exports
US imports on the XSI® skyrocketed over 65 percent in May to 464.09 points, its highest ever level as only very few shippers are still enjoying rates that would have been considered 'normal' a few years ago. With the latest increase, the benchmark is now 205 percent higher than this time last year and has zoomed 96 percent since the end of 2021.

Europe imports/exports
European imports on the XSI® continued to reach all-time highs after increasing over 11 percent to 379.13 points. Year-on-year, the index is now up 122 percent and has risen 40 percent since December 2021.