Ocean Freight Sentiment Index points towards further rate falls

Sentiment Index.

Ti’s Sentiment Index has fallen significantly throughout Q3-22 and now heads into the final quarter in negative territory.

Out of 2,379 respondents in Q3, 1,009 expected some levels of rate decrease in the coming 3 months, just shy of the 1,066 who expected rates to rise. In July 54% of respondents expected some level of rate rise with a moderate rate rise being the most likely answer delivering 19% of responses in that month. Just 35% of respondents expected rates to fall in July across all lanes. 3 months on, October data shows that respondent views have changed significantly, 55% of industry minds believed rates would fall in the coming 3 months when asked in October and 40% expected further rises. Moderate and significant decreases in Ocean rates were the most common answer both providing 18% of responses.

On a lane level expectation of further rate rises fell across all three major lanes. On the transpacific lane, the percentage of respondents expecting rates to rise in the coming grew from 36% in July to 59% in October. A significant decrease in transpacific rates in the coming three months is now the most common answer to this survey.

On the transatlantic lane, those expecting rates to rose from 34% in July to 45% in October, however, 42% are still expecting some sort of rate rise in the coming 3 months which keeps the index above 0.

On the East Asia to Europe lane the percentage of those expecting rates to fall increased from 33% in July to 60% in October.

In conclusion, the signs of falling rates are clearly being acknowledged by the market with experts in the industry expecting further rate falls, yet it seems the scars of recent rate rises have cut deep with many still expecting some levels of rate rises in the coming months which prevent the sentiment index from falling deeper into negative territory.