Average container prices and one-way leasing rates skyrocket in India amid peak shipping season

Container xChange, a technology marketplace and operating platform for container logistic companies published yesterday a report titled ‘Where Are All The Containers’. The report disclosed that amid the global peak shipping season, disruptions like container shortage, rising average container prices, and more than 200% rise in one-way pickup rates, are awaiting exporters and shippers in India.

India has withered the rising global disruptions with more resilience than many other countries. However, the ripple effect of disruptions caused well over the past two years has caused significant market and container imbalances in the Indian shipping industry. Apart from digitising supply chains, e-commerce and capacity building for containerised trade have been the government’s key focus areas.

India has been making its presence felt across the world as the China plus one strategy is unfolding, and has been leveraging its vast coastline lately. However, among the many roadblocks to further growth and improvement, hinterland transportation and cost of containers are major ones. The Container xChange platform always shows Indian ports as one of the costlier ports, which is also because there are many charges that make the movement of containers costlier from India. What India needs is a set of alternate mechanisms which can help expand port capacity and can then bring down the logistics costs.

“On a global scale, the important factor to consider is that there is not so much need for increasing the container fleet further. In fact, in another analysis, we studied that there will soon be an oversupply of containers worldwide. What is more important is to develop an infrastructure that attracts companies to conduct containerised trade in and through India. This will involve three key investments – digitalisation of container trade, infrastructure for transportation and bringing about efficiency and transparency in operational processes and charges.” 

Christian Roeloffs, Cofounder and CEO, of Container xChange

According to the report, there is a steep increase in the average container prices and one-way leasing rates in the month of July 2022. July is a crucial month for the shipping industry because this time period marks the beginning of the peak shipping season.  

Average Container prices for cargo-worthy boxes in India rose significantly since the pandemic 

Indian ports have been appearing in the costliest top 10 lists for both 20 ft DCs and 40 ft HCs as per the report. For 20 ft DCs, average prices rose by 61.15% from USD 900 in July 2020 to USD 2,317 in July 2022. Whereas for 40 HCs, average container prices increased by 57.34% from USD 1,800 in July 2020 to USD 2,317 in July 4220. 

However, the average trading prices for these boxes, for cargo-worthy 20DCs, the prices in Mundra, Nhava Sheva, and Chennai fell marginally to land at USD 2,384, USD 2,362, and USD 2,356. 

But for cargo-worthy 40HCs, the trading prices fell steeper at the ports of Mumbai and Mundra. The prices fell by 5.51% for Mumbai (USD 3,773) and 8.85% for Mundra (USD 3,605). The drop in prices at Chennai was 3.83% as the 20DCs were trading at USD 3,969. At Nhava Sheva, the average price for a cargo-worthy 20DC was USD 3,918.  

As the sailing disruptions followed by container shortages continue this year, many shipping lines have skipped India port calls to maintain schedule integrity. This has subsequently affected the demand and has further led to a gradual yet marginal decline in average prices for cargo-worthy containers. 

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