The global XSI® fell to 419.8 in December, down by just 0.1% from November.
The pace of decline has slowed since November, when the XSI® fell by 5.7% month on month. Back then, all the sub-indices also fell month-on-month, while this month, several have posted growth.
The lower-than-expected decline in the XSI® is largely due to fewer new long-term contracts being signed rather than new contracts coming in at the same rates.
Some shippers also see their valid long-term rates increase due to higher bunker surcharges.
Compared to December last year, the global XSI® is up by 70%. As older long-term contracts start expiring in the new year, the XSI® will post bigger month-on-month declines.
Across almost all trades, new long-term contracts have lower rates than the average for all valid rates. The only slight decline in the XSI® this month is largely due to very few new long-term contracts starting at this time of year.
However, with many older long-term contracts starting to expire in the new year, expect the XSI® to post bigger month-on-month declines. Indications for next year's rates show considerable drops from today's levels.
Several of the major trades out of the Far East indicate next year's new contracts are closer to today's spot market than the current long-term market rates, which are much higher.
XSI ® - Europe Imports / Exports
The XSI® for European imports fell by 1.4% month on month to 390.7 index points. Compared to a year ago, the index is up by 44%.
In the first ten months of the year, European imports of containers have fallen by 6.7%. In fact, imports in October, the latest month for which data is available, were at their lowest level since April 2020.
The XSI® for European exports also fell very gently in December, down by 0.3% from November to 383.9 points. Compared to December 2021, the index is still double what it was in December 2021.
European exports of containers are down 6.2% in the first ten months of this year, though unlike on the import side, volumes rose in October from earlier months.
XSI ® - Far East Imports / Exports
The XSI® sub-index for Far East imports is one of the trades that saw month-on-month growth in December, up by 2.3% to 214.4 points. The Far East import index is one of the few that has yet to see two months of consecutive decline.
Looking over the past year, it has not risen as high as other sub-indices. Despite smaller and fewer declines than on other trades, the sub-index for Far East imports is ‘only’ up by 33.8% from last December.
The sub-index for Far East exports fell by 0.6% from November to 558.0 points, its lowest level since May 2022.
This export sub-index is heavily weighted in the global XSI®, given its importance to global container trade and has now fallen for five months in a row.
The rolling back of the zero-COVID policy in China is a milestone many have been waiting for.
However, with the virus spreading quickly, the recovery will be slower than it could have been, with uncertainty still high.
XSI ® - US Imports / Exports
The sub-index for US imports rose by 1.4% in December, though at 545.9 points, it remains below where it was in October.
In November, this index fell by 8.9% from October. Compared to December 2021, the index is up by 130.4%.
The sub-index for US exports had the largest month-on-month growth in December, up by 2.7%. At 159.2 points in December, the index is at its second-highest level on record, beaten only by October. Compared to a year ago, the index is up by 35.9%.
US containerized exports are on track to fall year-on-year for the third year in a row.
Compared to the first ten months of 2019, US exports are down by 13.7%; compared to the same period in 2021, they are down by 4.3%.
Some of this decline is due to the congestion problems around US ports and US exporters' inability to pay the high freight rates while remaining profitable.
US manufacturing has also been slower to recover since the pandemic leaving fewer goods to be exported.