Flatter Flat Rates

Each year, the Worldscale Association publishes its assessment of nominal freight rates for designated voyage routes. After a spate of hefty year-to-year increases from 2005 to 2007, 2008’s flat rates are only modestly above those of 2007’s. Pushed mainly by the rising price of bunkers – but also by higher port charges and fluctuating exchange rates, the step increases in 2006’s and 2007’s flat rates were intended to reflect these added costs. As the chart below suggests, the magnitude of 2008’s changes are more muted than those in recent years.