Container market sentiment signals rebound: A ‘Shipper’s Market’ this peak season

• The majority of 2570 Supply chain professionals surveyed in July are hopeful of a container market rebound, Container Price Sentiment Index (xCPSI) reflects a positive outlook
• Container prices have remained stable in July, indicating a marked improvement that offers favorable conditions for shippers entering the peak season

Container xChange, an online container logistics platform, published its August Container Market Forecaster today. Despite the ongoing market fluctuations, the Container Price Sentiment Index (xCPSI) has exhibited resilience and witnessed growth in July as compared to the month of June. The forecaster also noted that container prices have been relatively stable over the past 30 days (July) as compared to the previous 90 days (May-July).

The Container Price Sentiment Index (xCPSI) conducts market surveys concurrently and distills industry experts' collective insights about container price trends into a quantitative measure, providing insight into near-future expectations for the container market dynamics. In July, 2,570 supply chain professionals participated in the survey.

While the opinion is varied, still most respondents (42%) foresee an increase in container prices in the near term which is indicative of potential market improvement, 28% foresee a further decline in container prices, suggesting a certain degree of pessimism in market conditions. 30% of those surveyed maintained that prices would remain unchanged.

This growth in sentiment underscores the industry's anticipation of an imminent turnaround, contributing a sense of positivity to the landscape.

Container Industry Stabilizing Amidst Market Fluctuations

Average container prices have been relatively stable in the last 30 days as compared to the price volatility over the past 90 days (30 days – July, 90 days – May-July).

Analyzing a 30-day price delta comparison across key regions, the market has witnessed average price fluctuations ranging from -4% to +5.20% in the month of July 2023. However, the container prices have experienced a visible dip over a 90-day period, with Southeast Asia reporting a substantial -15.73% decline from May to July 2023.

Despite this sustained dip, the sentiment index has stayed strong, even growing in July. The alignment of sentiment and pricing trends suggests an industry outlook that foresees a turning point, shifting away from skepticism toward shared anticipation of market recovery despite ongoing price adjustments.

Asian ports have been witnessing steady changes in average container prices for 40 HC cargo-worthy containers. For shippers, engaging in container trading or leasing within Southeast Asia at present, compared to three months prior or even just one month ago, presents a viable business prospect.

These average prices for 20 ft cargo-worthy containers (region-wise) as of 9^th August 2023 is illustrated in the graph below.

Carrier Capacity Management Spur Intra-Asia Trade Surge

According to Fitch Ratings, in the second quarter of 2023, China witnessed a 6% year-on-year increase in total container throughput, a significant improvement compared to 3% growth in the first quarter of 2023. This expansion was primarily propelled by the intensification of trade under the Regional Comprehensive Economic Partnership (RCEP), the introduction of new foreign trade routes at the Dalian port, and the upward trajectory of trade with nations participating in the Belt and Road Initiative.

A surge in demand for containers on Intra Asia trade lanes was observed on the platform, for example, the China to India stretch was popular in the month of July on Container xChange.

Here are the top five stretches for both the 40 HC and 20 DC containers Ex China on xChange Insights as on 10th August 2023 –