As expected, with rising interest rates dampening demand, container freight rates (the cost of transporting one 40-foot equivalent container) have declined significantly from peak rates in September 2021 (which were approximately 730% higher than 2019 freight rates), though they are still about twenty percent higher than pre-pandemic levels. See Drewry, World Container Index – 06 Apr, Drewry – Service Expertise – World Container Index – 06 Apr. Similarly, charter hire rates for container ships have also stabilized much lower than peak rates in March 2022, but still at levels much higher than before the pandemic. As demand has declined, port congestion in the United States also has eased.

Yet, two competing drivers will weigh on container carriage over the next few years. The first is that considerable container-carrying capacity is coming online starting in the second quarter of 2023 at a time when consumer demand is declining, which will have the effect of creating too much capacity and driving down both container freight and charter hire rates. The second is that air emissions regulations issued by the European Union (EU) and the International Maritime Organization (IMO) will commence in earnest in 2024.