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Valencia Containerised Freight Index: Freight Starts The Year With An Increase Of 10.41%

Valencia Containerised Freight Index: Freight starts the year with an increase of 10.41%

Source: PortSEurope
The Valencia Containerised Freight Index (VCFI) stands at 1,571.29 points, the highest figure since the start of the series in January 2018 – February 5, 2021 Despite a moderation in international trade, demand in maritime transport remains high for this time of year The price of fuels -Brent barrel or bunkering- continues to rise The idle fleet reached 1% of the total number of active
vessels representing 314,721 containers All geographic areas experience growth in freight rates. The Western Mediterranean starts the year with an increase of 3.05% and the Far East of 4.24% València, February 5, 2021 The Valencia Containerized Freight Index (VCFI) has started the year with a growth of 10.41% in line with the last semester of last year. Demand in the maritime transport market continues to be high for this time of year, which is also reflected in the low quota of the idle fleet, which stands at 1%. In this month of January, all the geographical areas analyzed by the index experienced increases in freight rates, in the case of the Western Mediterranean of 3.05% and the Far East of 4.24%. Thus, the VCFI created by the València Port Authority to reflect the evolution of maritime transport rates reaches 1,571.29 points, accumulating an increase of 57.13% since the start of the series in 2018. One of the factors in the variation in freight rates is found in the average price of a barrel of European Brent, which in January has once again registered an increase of 9.56%, already leading to three consecutive months on the rise. Bunkering prices (fuel supply to a ship) move in the same direction, which in January grew again compared to the previous month, generating several positive months to recover the levels lost in the first part of 2020. The demand in the maritime transport market has balanced after several months of strong growth due to the dynamism of international trade. Thus, in November, a stabilization in port traffic was already perceived, which continued in December, according to the RWI / ISL data prepared by the Leibniz Institute for Economic Research. This lower demand has been noted in the freight levels collected by the SCFI (Shanghai Containerized Freight Index) for the first weeks of 2021, which show a moderation that ends the continuous increase since October 2020. However, as indicated by Alphaliner, despite this change in trend, demand levels remain high for this time of year, which is also reflected in the low quota of the idle fleet in the market. Thus, while on January 4 the levels of inactive container ships represented 1.3% of the total active fleet, on January 18 this fell to 1.0%, reaching 314,721 TEU (standard container of 20 feet). Regarding the geographic areas under study by the VCFI, it should be noted that for the first time since 2018, all of them experience growth compared to the previous month. Among them, it is worth highlighting the strong increase in freight rates with the Baltic States (+ 21.24%), and Atlantic Europe (+ 10.44%). Freight to the Middle East (+ 13.49%) and the Indian Subcontinent (+ 6.40%) also increased, two areas that have experienced very high export traffic from Valenciaport in the second half of 2020, exceeding the levels of previous year’s load for the same period of the year. A notable case is that of freight with the United States and Canada (8.20%). Despite the fact that exports from Valenciaport have shown a downward trend since October with these markets, the pressure of world demand towards these regions seems to be the cause of the rise in freight rates. VCFI Western Mediterranean With regard to the Sub-index with the Western Mediterranean, in January it grew 3.05%, reaching 1,150.11 points. Thus, the strength of exports from Valenciaport with Morocco and the stability of commercial relations with Algeria, allow to maintain freight rates, which have already been increasing for two consecutive months. VCFI Far East As for the Far East Sub-index, it once again experienced a new growth of 4.24% and has already seen an upward trend for six consecutive months. Thus, the VCFI with this region accumulates a growth of 188.06% since the start of the series in January 2018. Thus, since October last year, the exports that leave Valenciaport to the Far East have registered an important growth that it has been maintained until the end of the year. On the other hand, it should also be noted that the proximity of the Chinese New Year, which is celebrated in February, may be increasing global export flows to China, which also translates into greater pressure on freight. Source: Autoridad Portuaria de València (APV – Valenciaport, Port Authority of Valencia)

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