SEA News – Container Ship Charter Market Analysis: From SCFI Index Decline to New ConTex Stability
According to the Public Relations Department of the Iranian Shipping Association and Related Services, the container ship charter market experienced multiple fluctuations last week. Despite a 9.31% drop in the Shanghai SCFI index, the market maintained relative stability. The New ConTex index saw a slight increase, reaching 1,416 points, indicating the market’s resilience against downward pressures. This report analyzes market developments and the key factors influencing these trends.
Relative Market Stability Despite Rate Declines
The Shanghai SCFI index fell to 1,595.08 points in the week ending February 20, 2025, marking a significant decline from its peak in July 2024. This 57% drop clearly reflects the downward trend in freight rates. However, in contrast, the New ConTex index recorded a 0.3% increase, reaching 1,416 points, highlighting market stability. This resilience is attributed to supply shortages of specific ship sizes, such as 1,700 TEU and 2,500 TEU vessels.
Freight Rate Analysis by Ship Size
1. Small Vessels (1,100 TEU)
- The daily charter rate for small vessels rose to $14,957, reflecting a 0.8% increase compared to the previous week and a 68.6% year-on-year growth.
- The rise is driven by high demand for short-haul and regional routes.
2. Medium-Sized Vessels (1,700 TEU)
- The daily charter rate reached $23,489, marking a 1.1% weekly increase and a 73.7% year-on-year growth.
- A significant decline in vessel availability in this size category has contributed to the price surge.
3. Large Vessels (2,500 TEU and above)
- Rates in this category have remained relatively stable in the short term but have seen significant long-term growth.
- The charter rate for 2,700 TEU vessels fell by 0.3% to $27,382, but still reflects an 86.3% increase compared to last year.
- These changes are primarily driven by supply constraints in this segment of the market.
4. Very Large Vessels (5,700 TEU and 6,500 TEU)
- Limited data is available for these vessels. However, industry reports suggest that demand is rising, particularly due to their high cargo capacity.
Comparison of SCFI and New ConTex Indices
While the Shanghai SCFI index has declined due to falling freight rates, the New ConTex index has remained stable due to limited vessel supply in certain size categories and sustained demand for long-term charters. Shipping companies are increasingly opting for long-term contracts (12–24 months) to shield themselves from market fluctuations.
Market Outlook
Market analysts predict that charter rates for medium-sized vessels (1,700–2,500 TEU) will remain stable or increase in the coming months, while rates for larger vessels (3,500 TEU and above) may decline in the short term. External factors such as improvements in global supply chains and reducing geopolitical tensions could drive higher demand and help stabilize rates.
Data Limitations and Market Risks
This report is based on data from the New ConTex index and market analysis. It is important to note that the data is intended for informational and trend analysis purposes only and should not be used as a basis for business decisions. Currency fluctuations, changes in trade policies, and geopolitical crises can rapidly alter market conditions.
Conclusion
The container ship charter market has achieved relative stability, though some segments continue to experience rising demand and rates. In the near future, medium and large-sized vessels may remain affected by supply shortages and sustained demand for long-term charters.
Source: Weekly New ConTex Index Report, published on February 20, 2025.
