The global XSI ® rose by an additional 11.1% in April to 294.44 points. ▶︎ Global Index ▶︎ Far East Indices (Import/Export) ▶︎ Europe Indices (Import/Export) ▶︎ US Indices (Import/Export)
The global XSI ® rose by an additional 11.1% in April to 294.44 points. This represents the third consecutive month-on-month increase after a temporary decline reported at the start of 2022.
Compared to the equivalent period last year, the index is up by 109.9% and has increased by 19.1% since the end of 2021.
If further proof was needed that carriers have been reaping the rewards of the prolonged market disruption, look no further than the most recent results from OOCL.
The subsidiary of Cosco reported revenue of $5.16bn for the quarter, up 71% year-on-year. The results also represent the third consecutive all-time high for the line, in terms of quarterly revenue.
This was despite liftings declining by 9.2%, albeit volumes were particularly high last year due to the shift to online shopping because of the pandemic.
Compared to the first quarter of 2019, volumes were up by 12%, highlighting the growth in liftings relative to pre-Covid levels. Average revenue was up by 88% year-on-year. The net profit of Cosco and OOCL combined was $3.3bn in Q4, with the state-owned company forecasting a profit of $4.3bn for Q1-2022.
European imports on the XSI ® skyrocketed by 16.8% in Apr-22 to 340.61 points. This represents one of the largest month-on-month increases on record.
The benchmark is now up by 107.3% compared to the same period last year and is up by 25.5% since the end of 2021.
Exports also rose this month, jumping by 20.3% to 261.74 points. This is the second-largest month-on-month increase on record and takes the index to 102.8% higher than in Apr-21.
Compared to the end of last year, the index is up by 36.5%.
Whilst the benchmark continues to go from strength to strength, China's zero Covid policy has resulted in a significant decline in exports, placing pressure on the spot market. In response, the 2M alliance is looking to blank three Far East-North Europe sailings next month.
The move follows similar announcements by other alliances as they battle to respond to the market situation. However, any slide in rates may be short-lived with peak season on the horizon.
Another impact of the lockdowns has been carriers simply omitting calls at certain terminals, whilst a lack of available equipment has created additional challenges.
With the market remaining severely disrupted, another major shipper has decided to take matters into its own hands.
German retailer Lidl is chartering three Panamax containerships and buying a fourth.
Operating under its own shipping line, Tailwind Shipping, the discount retailer will form a dedicated service, most likely on the Far East-Europe trade.
Whilst other major shippers such as IKEA, Amazon, Home Depot and others have sought a greater degree of control over their supply chains, they have typically used third-party vessel operators.
Far East imports on the XSI ® edged up by just 0.4% in April to 177.21. The index is now 52.3% higher year-on-year and is up by 8.2% since the end of 2021.
Meanwhile, exports jumped by 9.0% to 409.94 points, which represents the latest all-time high.
Compared to the same period last year, the benchmark is 127.7% higher and has appreciated by 20.0% since Dec-21.
The lockdown in Shanghai has not only impacted the world's largest port but is also having a knock-on effect on schedules at Hong Kong and Yantian.
With China's policy to deal with Covid impacting supply chains, the EU Chamber of Commerce in China has begun lobbying Beijing over its handling of the situation, suggesting it was no longer suitable for controlling the Omicron variant. However, it’s hard to see any immediate change in direction and therefore supply chains are likely to remain disrupted in one way or another as China continues to battle with Covid.
US imports on the XSI ® rose by 9.0% in Apr-22 to 281.15 points. This represents a new all-time high for the index after fluctuating over the last few months.
With this latest increase, the benchmark is now 109.7% higher than the equivalent period of 2021 and has risen by 18.7% since Dec-21. Less positive, for carriers at least, was a decline in exports of 0.8% to 121.70.
Despite the month-on-month decline, the index is still 29.8% higher than the same period of 2021 and is up by 3.9% since the end of last year."
Epitomizing this, the Ocean alliance has started their eighth Far East-US East coast loop, with ten 10,000+ TEU vessels being deployed.
The shift in trade patterns has resulted in the port of New York & New Jersey becoming the second busiest for imports in the US after Long Beach.
In further signs that lockdowns have been delaying Chinese production, data indicates that imports into LA were down by around a fifth compared to the same period of 2021.
One positive impact of this has been a further improvement in berth waiting times, which have fallen to 2.7 days.