Geopolitical volatility keeps Year to Date (YTD) container leasing rates elevated

• China to North America leasing rates surge in Q1 2024 to new levels as compared to 2023, stay elevated in April
• Ex China to Russia, India and Canada YTD container trading activity remains strong
• Demand for containers in China, US and Mexico stays elevated in Q1 2024

A YTD analysis of global container leasing transactions by Container xChange shows a notable uptick in average rates since the beginning of 2024, indicating an uptick in demand for container leasing services and increased financial burden on lessors, pointing to a potentially tighter market. The study also highlights persistently strong container trade patters between China and Russia, Taiwan and India, China and India, amongst other hot trade routes so far in this year 2024.

“China to North America one-way container leasing rates have increased particularly in 2024, with the rise mostly driven by a widening container price delta between China and the US (China becoming “more expensive” up until March vs. US container prices stagnating or decreasing).” commented Christian Roeloffs, cofounder and CEO of Container xChange, an online container trading and leasing platform.

China to Canada leasing rates rise by 64% in March

There has been a significant spike on the China to Canada ports from February to March. Yantian to Toronto rates surged by 68% from February to March. These were $730 in February which peaked to $1230 in March. The Qingdao to Vancouver leasing rates surged by 64% in one month. Ningbo to Toronto rates surged by 35%, Shenzhen to Toronto rates surged by 26%, Tianjin to Toronto rates surged by 23%.

China to US rates also surge significantly

The most significant surge was witnessed on the Ningbo to Oakland routes where rates surged by 92% in one month (from February to March 2024), where the leasing rates were $1020 in February and reached to $1963 in March this year.

Container leasing rates from Shanghai to Los Angeles saw a significant increase in Q1 of 2024 compared to 2023 (see chart below). This uptick can be attributed to significant geopolitical disruptions, primarily the Israel-Hamas war that began in November and continued through the first quarter of 2024, which have kept leasing rates on this route elevated. The average leasing rates from Shanghai to Los Angeles for 40 ft high cube containers increased by 67% from an average of $703 in Q4 2023 (Oct-Dec) to $1173 in Q1 2024 (Jan-Mar).