Tianjin Shipping Index (Jan.22-Jan.26)

Feb 7, 2018

I. Tianjin Shipping Index (TSI)

In Week 4 (Jan.22-Jan.26), Tianjin Container Freight Index (TCI) increased with fluctuation. Tianjin Bulk Freight Index (TBI) kept increasing. Tianjin Domestic Container Freight Index (TDI) decreased sharply early this week and then stabilized. Tianjin Shipping Index (TSI) decreased and then increased. The TSI closed at 645.23 points with an increase of 1.24% from Jan.19 (the last release day of Week 3). The TSI trend is as follows,

The chart above shows the trends of TSI from Jan.15 to Jan.26. The value of TSI in Week 4, 2018 is as follows,

II. Tianjin Container Freight Index (TCI)

In Week 4, 2018 (Jan.22 to Jan.26), the trend of TCI is as follows,

In Week 4, the TCI increased with shocks.

From Jan.22 to Jan.24 (Mon. to Wed.), the freight rates in European route and Mediterranean route increased and then decreased. The freight rates in North American route and South American route kept decreasing. The freight rates in India-Pakistan increased markedly. The TCI increased and then decreased and finally increased 0.26% on three consecutive release days. From Jan.25 to Jan.26 (Thu. to Fri.), the freight rates in European route, Mediterranean route, South American Coast route and India-Pakistan increased overall. The freight rates in North American route kept the decrease trend. The TCI increased by 3.50% on two consecutive release days.

The TCI closed at 458.13 points with an increase of 16.64 points (3.77%) from Jan.19 (the last release day of Week 3).

The TCI index value saw several up and down on a day-on-day basis are as follows:

European/Mediterranean route With Spring Festival coming, factories stepped up the pace for shipment. For some ship owners, the shipping space was tight. The freight rates increased markedly. The freight indices in European route, Mediterranean East route and Mediterranean West route increased 4.79%, 9.50% and 5.74% respectively on a week on week basis.

North American route Cargo volume on this route increased steadily since the beginning of 2018. The freight rate increased thirty percent at the end of last week, which restrained ship owners’ enthusiasm for shipment. This week, the increase of cargo volume presented a decline trend. It has become a main stream that loading rate increased by reducing freight rates. Therefore, the freight rates were decreased step by step. The freight indices in North American West Coast route and North American East Coast Route decreased 3.92% and 2.21% respectively this week.

South American route In comparison with European route and North American route, the “Spring Festival Effect” was not evident. The increase of cargo volume was slow this week. In first half of the week, the freight rates were reduced for more cargo. In latter half of the week, some ship owners tried to raise the freight rates and the freight rates were increased. Finally, the freight rates in South American West Coast route and Central South American route increased to the former high point. The freight indices increased 2.04% and 1.51% on a week on week basis. The freight rates in South American East Coast route presented a decrease trend and the freight indices decreased 1.21% on a week on week basis.

India-Pakistan route The freight rates in India-Pakistan route decreased markedly since latter half of 2017. The current freight rate was one third of the same period in 2017. Pressure by cost, the freight rates is about to increase. This week, the ship owners reached the consensus to raise the freight rates and the freight indices increased 32.87% on a week on week basis.

III. Tianjin Bulk Freight Index (TBI)

Week 4, 2018 (Jan.22 – Jan.26), Tianjin Bulk Freight Index (TBI) is shown as follows:

In week 4, the TBI increased steadily in the first half of the week and the increase extended later.

From Jan.22 to Jan.23 (Mon. to Tue.), the freight rates of coal and grain increased slightly and the freight rate of mineral ore increased with narrow shocks. TBI increased slightly for two successive release days and the total increase was 0.40%. Then, the freight rates of coal and mineral ore continued to increase and the increase extended gradually, the freight rate of grain continued to increase slightly. TBI increased 5.60% from Jan.24 to Jan.26 (Wed. to Fri.).

TBI ended at 762.22 points with an increase of 43.32 points (6.03%) from Jan.19 (the last release day of week 3).

TBI index value saw several ups and downs on a day-on-day basis, which is shown as follows:

TBCI increased continuously this week. TBCI ended at 592.85 points with an increase of 44.91 points (8.20%) from Jan.19 (the last release day of week 3). The deal of coal recovered this week and the freight rate increased. For the Panamax market, the oversupply situation of carriers improved and the freight rate of the DBCT to Tianjin route increased over 10%. The freight rate of the Capesize increased slightly and the freight rate of Hay Point to Qingdao route increased over 5%.

TBGI increased slightly and continuously this week. It ended at 689.88 points with an increase of 8.34 points (1.22%) from Jan.19 (the last release day of week 3). The deal of grain in South America was active and the demand for carriers increased, then the freight rate increased. The freight rate of South America to Tianjin route increased over 2.2%. By contrast, the freight rate of US Gulf to Tianjin route increased over 0.4% and the freight rate of West America to Tianjin route increased over 0.7%.

TBMI shocked narrowly earlier this week but increased fast later. It ended at 1003.94 points with an increase of 76.73 points (8.28%) from Jan.19 (the last release day of week 3). For the iron ore market, domestic snowing weather caused port congestion, inquiries for iron ore transport market increased and FFA forward contract price recovered. This made the Capesize market become well and the freight rate of West Australia to North China route increased about 12%. The freight rate of Brazil to Tianjin route increased about 4%. As for nickel ore, the freight rate of Surigao to Tianjin route increased about 1.5%.

IV. Tianjin Domestic Container Freight Index (TDI)

In the fourth week of 2018 (Jan.22-26), the trend of the TDI is as follows:

In the fourth week, Tianjin Domestic Container Freight Index (TDI) stabilized after a sharp drop.

On Jan. 22 (Monday), both the inward and outward indices showed declines, dragged TDI down rapidly and set the biggest one-day drop of 4.57% since the start of this month. Subsequently, the Outward Index recovered its momentum and TDI was subject to the changes of the Inward Index. From Jan. 23 to Jan. 25 (Tuesday to Thursday), the freight rates from Shanghai to Tianjin and Guangzhou to Tianjin slightly decreased. TDI extended its decline and dropped a total of 2.36 points on the three release days. On Friday (Jan. 26), the TDI ended at 916.98 points, down by 46. 06 points or 4.81% compared with January 19 (the last release day of the third week).

The value of TDI ups and downs on a day-on-day basis are as follows:

Tianjin Domestic Container Outward Freight Index (TDOI) dropped sharply. The index closed at 1081.79 points on Jan. 26, down by 71.52 points or 6.20% from January 19 (the last release day of Week 3). As the Spring Festival holiday is coming, production will be halted during the holidays and freight demand will be weakened. In order to cope with the surplus shipping capacity during the holiday, the shipping companies substantially reduced the freight rate to reserve the order so as to enhance the ship loading rate. The freight rates of three routes in the south dropped sharply. This week, the freight indices of Tianjin-Quanzhou, Tianjin-Guangzhou and Tianjin-Shanghai decreased by 9.12%, 5.22% and 5.64% respectively on a week-on-week basis.

Tianjin Domestic Container Inward Freight Index (TDII)continued to decline. The index closed at 752.16 points on Jan. 26, down by 21.20 points or 2.74% from January 19 (the last release day of Week 3). As the Spring Festival approached, the transport demand in northern route market was light and the freight rate slumped. The freight index from Shanghai to Tianjin decreased 1.27% on a week-to-week basis. The freight index from Guangzhou to Tianjin narrowed slightly compared with that of the previous week, decreased 3.77%; The freight rate market of Quanzhou to Tianjin remained stable.

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