Backhaul utilisation drops below 40%, according to Sea-Intelligence

News by WCN Editorial

Sea-Intelligence reports that post-pandemic backhaul vessel utilisation, previously around 50%, has fallen below 40% in August 2024.

Sea-Intelligence has analysed developments in trade imbalances and backhaul utilisation, in the post-pandemic period. In this context, the headhaul is defined as the direction with the larger trade flow, and the return leg is referred to as the backhaul. Before COVID, the backhaul vessel utilisation was hovering around the 50% mark but has been declining since then and dropped below 40% in August 2024 for the first time. "The way we have calculated backhaul utilisation is by assuming all headhaul vessels to be 100% full, which means that the volume of backhaul cargo, as a ratio to the headhaul cargo, becomes equal to the backhaul utilisation. Credit: Sea-Intelligence "If we also factor in the distance travelled by the container vessels, measured as TEU*Miles, we see backhaul utilisation drop below 40% for three consecutive months, with a record-low number of 36.6% in August 2024," Sea-Intelligence clarified. Figure 1 shows that trade imbalances have significantly worsened globally since before the pandemic. "This is particularly evident in the five largest deep-sea trades by volume, which have all seen a notable decline in trade balance compared to the pre-pandemic period," Sea-Intelligence added. As a result, headhaul trades may have to pay more to reposition empty containers, as there are fewer backhaul containers to offset these costs. On the other hand, backhaul shippers could face higher freight rates due to a reduced number of paying containers relative to the available vessel space. "Ultimately, whether carriers decide to pass these additional costs onto headhaul or backhaul services will depend on their market strategies," Sea-Intelligence concluded.
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Container Shipping News Shipping & Logistics Backhaul utilisation Sea-Intelligence

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