Trans-Pacific spot container shipping rates have crossed two bearishthresholds. It depends on which indexes you believe, but according to Drewry’s,spot freight rates are now below where they were at this time last year, andaccording to Xeneta’s, spot rates are now below current contract rates.

Spot shipping rates now versus last year

Drewry’s weekly spotrate assessment, released Thursday, put Shanghai-Los Angeles rates at $7,952per forty-foot equivalent unit, down 7% year on year (y/y). Drewry put theShanghai-New York rate at $10,403 per FEU, also down 7% y/y.

That’s a big changefrom the week before, when Drewry’s Shanghai-Los Angeles assessment was stillup 32% y/y and Shanghai-New York spot rates were up 33%.

Thehuge week-on-week flip was not due to a collapse in rates in the past week.Drewry’s trans-Pacific assessments pulled back the most this year betweenmid-March and mid-April. Declines have been more gradual since.

Rather, the maindriver of the y/y decline was a spike in spot shipping rates during this weeklast year, when Drewry’s Shanghai-Los Angeles and Shanghai-New York spotassessments surged 34% and 39% week on week, respectively.

The current weekalso marks the first time that Drewry’s Global Composite Index has gone intothe red since container shipping began its run. It’s now down 10% y/y.

Nevertheless,trans-Pacific spot rates remain far above pre-COVID levels. Drewry’sShanghai-Los Angeles assessment is still 5.7 times the rate in the same week in2019. The Shanghai-New York rate is still 4.3 times higher.