Freight rates will fall in second half

INTERNATIONAL freight rates are forecasted to fall in the second half of 2010 due to overcapacity and slowing demand.

Rates increased over the first half of the year because of reduced transport capacity and increased freight demand. Global merchandise exports grew by seven per cent between the second and first quarters, thanks to resumption of industrial activity and the restocking of inventory.

However, in the third quarter rates have started to slide due to the introduction of additional fleet and services to cater for the growing economic activity. Slowing freight volumes, due to a slower recovery in demand and manufacturing activity during the rest of the year, will compound this.

This has already been seen in some markets. According to the Drewry Air Freight Price Index, the average airfreight price out of Asia fell by 10.1 per cent in July 2010, marking the second consecutive monthly decline in the past year.

Share this story