Shipping Container Costs Have Dropped 50%-60% From COVID-era Peak
September 12, 2022 by Dave Haynes
I don’t write much about shipping container costs because I know very little about that whole thing, but I do know those costs skyrocketed through the pandemic, and that affected prices for large items like displays. Which brings me to the good news, I think, that costs are dropping in a big way.
A publication that would know about this sort of thing – Marine Insights – says Ocean Shipping Rates Plunged 60% In 2022.
Part of the good news here is that this is happening in peak shipping season – with all kinds of stuff coming over for the Q4 holiday shopping binge. So this period, in theory, is higher demand and higher cost.
Global container shipping costs are now down almost 50% year-on-year. Some major East -> West routes are down even more, and still falling week-on-week. pic.twitter.com/1fBmWXJDll
— Mike Bird (@Birdyword) September 12, 2022
The cost incurred to ship a 40-foot container to the West Coast in the US from China is now about $5,400 per box, a drop of 60% from January 2022, per Freightos Baltic Index. Each container shipped to Europe from Asia now costs $9,000, which is about 42% lower than observed early in 2022. At the same time, above pre-pandemic levels, the rate for both routes peaked at over $20,000 in September 2021.
Market conditions have made a sharp reversal from earlier in the pandemic. Freight rates jumped almost 10-fold during the previous year owing to port backlogs, surges in cargo, and supply chain disruptions. As a result, importers were found scrambling for space on the box ships. Retailers like Walmart -1.10%▼ chartered personal vessels to overcome the bottlenecks in 2021.