Xeneta’s global XSI® for the contract market dropped by 5.7% in November. It is the largest month-on-month drop since the XSI® was first published in 2019. The index stood at 420.15 points in November, falling to its lowest level since May.
Xeneta's global XSI® for the contract market dropped by 5.7% in November. It is the largest month-on-month drop since the XSI® was first published in 2019.
The index stood at 420.15 points in November, falling to its lowest level since May.
This is the third month in a row that the global XSI® has fallen month-on-month. However, November has brought an end to another streak.
It's the first month since October 2021 in which the index is less than double compared to the corresponding month last year. Compared to November 2021, the global XSI® is 'only' up by 67.2%.
For many carriers, the fall in the XSI® will be the trigger for their average rates falling and bring an end to record-breaking quarters.
Q3 results for several large carriers showed their average rate increased from Q2, despite the collapse in the spot market. However, with long-term rates now firmly coming down, carriers will no longer be able to hide falling volumes behind higher rates.
The XSI® for European imports fell for the third month in a row, though at a slower pace than in October.
The index now stands at 396.13 points, 3.5% lower than in October. Compared to November 2021, the index is up by 47.9%.
Imports into Europe have fallen by 5% in the first nine months of the year, with volumes falling to their lowest level of the year in September.
The lack of peak season has allowed ports to clear up some of the backlogs, but congestion remains high as shippers are increasingly using the port as storage for goods they don't yet need due to lower demand.
The sub-index for European exports saw a smaller drop, down by 1.1% from October, leaving it at 384.4 points in November. Compared to last year, the index is up by 83.0%.
One of the trades that has been catching much attention is from Europe to the US East Coast, which is the most heavily weighted sub-trade on the index. Here the spot rates have been falling much slower than on other major trades.
Even though they are falling now, as extra capacity is moved to this trade, the average for all valid long-term rates on this trade continued to increase in November, limiting the fall in the overall index.
The Far East export index fell to 561.24 points in November, its first time below 600 since May.
This was an 8.5% fall compared to October, the biggest month-on-month drop on record and the fourth month in a row with a fall.
Compared to November 2021, the index is up by 68.5%, the first time since June 2021 that the index is less than 100% higher than in the corresponding month the year before.
The Far East import index fell by 6.2% in November to 209.69 points.
Now up by 30.9% from November 2021, this is the XSI® sub-index with the lowest year-on-year growth. China's continued zero-COVID policy means a large share of the country is now in some form of lockdown as case numbers reach record highs.
Protests against these continued strict rules have broken out in many parts of the country, but for now, China's economy continues to suffer from restrictions and uncertainty.
The US import index fell to 538.18 in November, down by 8.9% from October.
Volumes on the Transpacific continue to be muted, though spot rates on the Transpacific seem to have stabilized at a low level.
Some carriers are reporting that a few of their services are now below breakeven levels. On the long-term market, the average rate for all valid long-term contracts from the Far East to the US has seen double-digit drops over the past month, leading the way for the index to fall.
The index for US exports fell by 5.3% in November to 155.09 points. This still marks a 25.4% increase since the start of the year and up by 38.6% from November 2021.
The shift in market dynamics and carriers' hunger for volumes has eased the pressure on US exports, who are once again able to find suppliers willing to take their volumes at the rates they are used to paying.
