Freightos: Weekly Ocean Freight Index Update

Freight rates have eased significantly due to the end of peak shipping season and the conclusion of the International Longshoremen’s Association’s (ILA’s) three-day labour strike on the East and Gulf coasts of the US. However, a backlog of cargo resulting from the strike remains to be resolved, slowing the decline in rates.

The Freightos Baltic Index, dated October 8, reported the following week-on-week changes in booking rates:

Key takeaways: 

Freight rates have continued to drop by significant margins, but ongoing port congestion and delays following the recent ILA strike may temper further rate reductions in the coming weeks. An estimated 45-60 vessels are anchored near the East and Gulf coasts of the US, waiting to dock. Shipping experts have commented that a duration of two to three weeks may be required before the industry sees a complete clearance of the bottleneck.

Shippers with vessels at anchor or cargo on the ports are hence likely to continue to experience holdups. Shipments due to arrive will likely also face delays before ports can return to normal operations.  

The strike by ILA workers at East Coast and Gulf ports ended last Thursday after the union accepted a 62% wage increase over six years. The expired contract with USMX has been extended until January 15, 2025, to address the remaining issues, particularly concerning port automation.

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