THE average shipping container prices in Singapore has increased by 26 per cent from October 2023 to May 2024, reflecting a “substantial increase” in demand for capacity amid global port congestion.
In Singapore, the average price of 20-foot (ft) dry containers was US$950 in September 2023, but has since risen to US$1,211 in the last week of May.
Congestion at Singapore’s port is expected to persist well into June, and potentially longer, said Container xChange, a Germany-based trading platform, on Wednesday (Jun 12).
The platform attributed the congestion to an increase in throughput in Singapore, disrupted global shipping schedules, as well as off-schedule arrivals.
Throughput in Singapore increased 8.8 per cent year on year to 13.4 million twenty-foot equivalent units in the first four months of 2024 – resulting in berthing delays of up to two to three days due to off-schedule arrivals.
The report also noted that despite port operator PSA International’s efforts in increasing handling capacity, the volume of off-schedule arrivals continued to strain the system, exacerbating the congestion. Additionally, disrupted global shipping schedules have also resulted in ships arriving in clusters and “overwhelming terminal operations”.
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As a result, several shipping lines have started to shift some transshipment operations from Singapore to regional ports.
“Persistent congestion at a key hub like Singapore can impact global trade flows, affecting the movement of goods between Asia, Europe and the Americas,” said the platform’s co-founder and chief executive Christian Roeloffs.
Container xChange highlighted that the Mediterranean Shipping Company (MSC) has diverted some of its operations to Indian ports. Demand for cargo from routes, including China to the US and China to Europe, also increased significantly over the last six months, the report noted.
“This uptick in demand also affects box movement at the Singapore port, given that Singapore is a strategic transshipment hub, crucial for the smooth and efficient functioning of global trade,” Container xChange added.
Container leasing rates on key routes, including China to the US, have also doubled since November, mainly due to challenges faced by shippers such as the Houthi attacks in the Red Sea. The leasing rate for the Shanghai-Los Angeles route, for instance, rose from US$643 last November to US$1,100 in May.
Container xChange also noted that the situation of global congestion has led to a rise in port omissions in major ports, including Singapore, Hong Kong, Ningbo, and Shanghai.
