The freight rates have started to slide down due to the drop in business from China.
Freight companies now have space to fill on their vessels and have reduced freight for the first time in over 12 months.
The drop in exports is a combination of power outages in China and a drop in trade caused by the high freight rates for the last 12 months as business look elsewhere to manufacture their products.
The general feeling is that rates will stabilise at this current level in early 2022 ahead of Chinese New Year and then drop 2-3 weeks after the China national holiday.
Freight rates dropped by move than USD4,500.
Many of the bigger manufacturing regions have been hit with power cuts as the Chinese Government look to hit climate change targets.
Factories have been forced to close for 2 to 4 days due to power cuts, as the government target factories in order to keep schools and hospitals supplied with power.
As winter starts to bite these power cuts are set to continue well into 2022.
Tinworks have not been affected as our factory has solar power and back up generators, and we can share our production between China and Sri Lanka.
One employee had a positive COVID test and the Chinese Authorities closed Ningbo port the 3rd largest in the world, costing the world economy billions, yet other areas in China are on the 3rd wave of COVID.
While the rest of the world get vaccinated and learn to live with COVID 19 and the new strains, the country that started the virus are now controlling and derailing the global economic recovery.
The closure of Ningbo left 48 vessels at anchor and millions of containers backed up causing massive delays.
Some economists are saying that port closures are a ploy that forces up prices with the aim to drive the Western economies into a depression with the massive price hikes on the freight costs.
Take COSCO (China Ocean Shipping Company) as an example the 3rd biggest in the world, a 20,000 TEU vessel during October 2020 would arrive in Europe and the revenue was an average of 15.5 Million Dollars for that sailing, the same vessel today is now 175 Million Dollars, surely China could reduce prices causing all shipping lines to follow suit to help the European and Global recovery from a pandemic that originated there?