Container prices from Asia to California have increased by 50% in the last year and tend to keep growing. The most extensive container lane, Asia to Europe, has seen rates of $969 vs. $695 in 2016 (+40%), and poor container availability out of Europe going east – in the words of one of our clients – has been “problematic. It’s hard to get boxes.”
Why container prices became so high?
Here are some reasons given:
- Price fixing – the Feds are looking at this…although it is hard to believe that shipping lines would push rates to only $969 when their costs are closer to $1400
- The 3 big alliances control 90% of all volume
- Ships have been idled, reducing capacity
- Operations have slowed for the Chinese New Year
- Repositioning of ships for alliance startup in April
- Hanjin bankruptcy
I suspect it is all of the above – but an industry can’t lose $5 billion annually and continue as a going concern.
All those show how important is the maximum loading of each container and each truck.
In Warehouse Optimization, we work to push the maximum possible goods to every ship and make it safe and legal.
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