LOGISTICS: Asia-US container rates fall; tanker rates stable to softer; bridge collapse causing delays

HOUSTON (ICIS)–Shipping container rates continue to fall, liquid chemical tanker rates are stable to softer, and the bridge collapse at the Port of Baltimore has led to longer delivery times for imports, highlighting this week’s logistics roundup.

CONTAINER RATES
Rates for shipping containers from east Asia and China to the US continue to fall along with average global rates as capacity remains ample to handle the longer routes as commercial vessels continue to avoid the Suez Canal.

Supply chain advisors Drewry said average rates ticked lower this week but remain 64% higher than the same week a year ago, as shown in the following chart.

Rates from Asia to the US and Europe have also continued to fall, as shown in the following chart.

Drewry said it expects a minor decrease in Transpacific spot rates and for stability along the Transatlantic and Asia-Europe trade lanes.

Judah Levine, head of research at online freight shipping marketplace and platform provider Freightos, said rates along the US East Coast have fallen since the collapse of the Key Bridge in Baltimore, which signals to him that regional container traffic continues to flow.

Levine said downward pressure will continue because of soft demand and it being the slow season for container trade, but that if threats persist in the Red Sea and commercial vessels continue to divert away from the Suez Canal, prices will remain above normal.

Container ships and costs for shipping containers are relevant to the chemical industry because while most chemicals are liquids and are shipped in tankers, container ships transport polymers, such as polyethylene (PE) and polypropylene (PP), which are shipped in pellets.

They also transport liquid chemicals in isotanks.

PORT OF BALTIMORE
The Unified Command (UC) continues to remove containers from the Dali and clear wreckage from the collapsed bridge at the entrance to the Port of Baltimore.

Source: Key Bridge Response 2024

While the closure of the port has not had a direct impact on the flow of chemicals, a market participant in Ohio said it is seeing delays in delivery times for imports as vessels originally destined to offload in Baltimore are getting re-routed to other ports.

The US Army Corps of Engineers (USACE) expects to open a limited access channel 280 feet wide and 35 feet deep by the end of April, and are aiming to reopen the permanent, 700-foot-wide by 50-foot-deep federal navigation channel by the end of May, restoring port access to normal capacity.

As of 11 April, approximately 38 containers have been removed, the UC said, which is necessary for safe access to them begin removing the segments of the fallen bridge that lie across the ship’s bow.

While marine traffic is still limited, 69 vessels have transited through since the creation of the temporary alternate channels.

LIQUID CHEM TANKERS
US liquid chemical tanker freight rates as assessed by ICIS held mostly steady this week – except from the US Gulf Coast (USG) to India.

There is downward pressure on rates along the USG-Asia trade lane as several outsiders have come on berth for both April and May, adding to the available tonnage for completion cargos.

On the other hand, rates from the USG to Rotterdam were steady this week even as space is limited and there are no outsiders on berth.

Contract tonnage continues to prevail, with continued interest in styrene, MTBE and ethanol.

There has been activity on the spot market, but owners are still working with COA customers to finalize their needs before committing to others.

For the USG to South America trade lane rates remain steady with several inquiries for methanol widely viewed in the market.

PANAMA CANAL
Wait times for non-booked vessels ready for transit edged higher both directions this week, according to the Panama Canal Authority (PCA) vessel tracker and as shown in the following image.

Wait times last week were 0.8 days for northbound traffic and 0.8 days for southbound traffic.

Please see the Logistics: Impact on chemicals and energy topic page

With additional reporting by Emily Friedman and Kevin Callahan