The market trend is not yet clear, how can the increase in freight rates in May be a foregone conclusion?
Since the second half of last year, sea freight has entered a downward range. Does the current rebound in freight rates mean that the recovery of the shipping industry can be expected?
The market generally believes that as the peak season of summer is approaching, container shipping companies are showing renewed confidence to promote new capacity. However, at present, the demand in Europe and the United States continues to be weak. As a macroeconomic data with a high correlation with container freight rates, the manufacturing PMI data in Europe and the United States in March were not satisfactory, and they all fell to varying degrees. The U.S. ISM manufacturing PMI fell by 2.94%, itself the lowest point since May 2020, while the Eurozone manufacturing PMI fell by 2.47%, indicating that the manufacturing industry in these two regions is still in a contraction trend.
In addition, some insiders in the shipping industry said that the shipping price of ocean-going routes basically depends on market supply and demand, and most of the fluctuations fluctuate with market conditions. As far as the current market is concerned, shipping prices have rebounded compared to the end of last year, but it remains to be seen whether ocean shipping prices can really rise.
In other words, the previous surge was mainly driven by seasonal shipments and urgent orders in the market. Whether it represents the beginning of a rebound in freight rates will ultimately be determined by market supply and demand.