The Container Freight Market had witnessed a multi-fold surge in prices across most key trade lanes in Q2 2024, and the effects are beginning to see on the Multipurpose Sector too, with Containers being booked on Multipurpose Vessels, in addition to the effect of added tonnage miles, courtesy- the 2024 Supply Chain Crises led by the Red Sea.
The Toepfer’s Multipurpose Index cemented its rising streak surpassing the USD 13,000 mark for the Weighted average for the first time since September 2023, ending higher by 2.15% to quote USD 13,135. The Drewry Multipurpose Time Charter Index which also weighs in on the smaller MPP vessel segment ended at USD 9,212 per day, just above the forecast of USD 9,201 led primarily by the larger MPV segment as the smaller segment saw the cyclical cool-offs.
The Market Sentiment Index (MSI), released by One World Shipbrokers, towards the end of July 2024 echoed a positive sentiment, with the levels near to Q4 2023. The spillover effect has led to the demand for MPP vessels to carry the cargo while the typical peak season to cater for the energy requirements of the winter and the holidays has also commenced leading to some cyclical demand. The lack of many newbuilding orders in the space could still act as a cursor for the rates not to fall as much, considering that DNV recently updated the sector’s fleet ageing at 17.4 years and counting, the other side of the coin would mean looking at the end of the peak cycle demand for containers and concerns over economic indicators and growth among the key economies as possible restrictions on the upside.
The sentiment is echoed by TMI forecasting prices to grow at 1.7% and 3.6% respectively for the 6 month and 12 month scenarios. As for the short term, Drewry predicts USD 9,245 for its next quote, higher to the present by 0.4%.
Author of the article: Gautham Krishnan
Gautham Krishnan is a logistics professional with Fluor Corporation, in the area of project logistics and analytics, and has worked in the areas of Project Management, Business Development and Government Consulting. He has been bestowed the AntwerpXL 40-under-40 award for the year 2023, as one of the upcoming, future leaders in the project logistics space.
