Annual contracts are being negotiated between shippers and lines on the Transpacific container trade ZIM warns if rates are too low it will stop sailing.
Container spot rates have plummeted from record highs and ZIM saw a 42% drop in average freight rates year-on-year to $2,122 per teu. Spot rates have plunged from a year ago and Drewry’s World Container Index (WCI) for the week ended 9 March stood at $1,806 per feu, 80% lower than the same week a year earlier.
It is against this background that ZIM and other container lines are now negotiating contract rates on the Transpacific trade from Asia to the US. In a conference call for ZIM’s Q4 2022 results Xavier Destriau, CFO and Executive Vice President of ZIM, described the situation today as “unique” using the analogy of a pendulum where an extraordinary situation market situation for the last two years has now swung “very strongly in the opposite direction”.
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