ROTTERDAM, June 11 – At the TOC Europe 2024 conference held in Rotterdam, industry experts and keynote speakers expressed a consensus that the maritime trade market is on the verge of returning to pandemic-era conditions due to further increases in container freight rates.
Global supply chain experts highlighted that the ongoing Red Sea crisis and increasing congestion at regional ports continue to disrupt the container trade market. The looming threat of tariff wars and subsequent surge in demand are also contributing factors.
“Just six months ago, we thought the 2024 market would be like walking through a desert,” said one participant. “But everything has changed now. Many shippers are grimacing, anticipating a resurgence of COVID-19, and are acting quickly. The uncertainty is driving spot freight rates up, and further increases are expected in mid-June.”
Another expert suggested that while not all container trade markets might be affected, some trade routes are effectively back to the pandemic era. “We’ve already entered pandemic-level territory. There’s no doubt about it,” he emphasized. “When the Red Sea crisis erupted, there was an oversupply of capacity. In hindsight, it was a blessing. If carriers hadn’t increased supply further, rates would be much higher now.”
He added, “But then another problem arose, and there was no excess capacity to absorb it. The recent surge in demand at Western Mediterranean and Singapore ports over the past six weeks has caused congestion, reminiscent of the pandemic.”
The recent surge in ship charter rates is a testament to this trend. Both shipowners and carriers anticipate that this issue will persist for a considerable time. “Charter rates have doubled since December last year. Charter periods are also getting longer, and neither shipowners nor carriers seem to have a clear solution,” lamented one participant.
Experts concluded that with no end in sight for the Red Sea crisis, the uncertainty and future anxiety surrounding this issue, which could last for months or even years, will further destabilize the market.
One expert warned, “If this is the beginning of peak season, the current demand boom will surely subside by early July. But if demand strengthens further, it’s a return to the pandemic era, and freight rates will likely be even higher.”
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