Container xChange's recent update on the China market highlights a significant mismatch in container price expectations between buyers and sellers, primarily driven by a demand deficit. Christian Roeloffs, cofounder and CEO, pointed out, "There is a significant imbalance between supply and demand price expectations for containers. Buyers are expecting price reductions in weeks to come, while sellers are holding off the inventory as they expect prices to remain stable due to tight capacity, especially after the diversions due to the Red Sea and highly imbalanced trade, particularly, for example from China into Russia."
Despite a 12.5% increase in China's exports to Russia and a 6.7% rise in imports for the first two months of 2024, the surplus of units in Russia and saturated capacity has not spurred significant price reductions. Both buyers and sellers are adopting a cautious stance, leading to a slow accumulation in depots. However, this has not yet pressured traders to adjust their price expectations significantly.
Roeloffs further mentioned, "Looking ahead, while mid to long-term forecasts suggest a necessary adjustment in prices to restore liquidity, the present market sentiment indicates a reluctance to anticipate significant price drops." The Container price sentiment index (xCPSI) by Container xChange also reflects a decrease in price drop expectations among buyers, moving from 83 points in late January 2024 to 22 points by mid-March 2024.
Source: container-news.com