Shipping companies continued to rally yesterday, lifted by news that rates on key trade routes to Europe and the United States had risen more than 20 per cent since January. China Cosco Holdings, the mainland's largest shipping conglomerate, said the Asia-Europe freight rates had risen by US$300, or 20 per cent, to US$1,800 per 20-foot-equivalent unit (teu) since Friday. The rate increase had restored the trade lane to break-even level, an official from the shipping company said yesterday. The transpacific route, for which the general rate increase is set annually by contract negotiation in May, also imposed a US$400 emergency revenue charge per 40-foot-equivalent unit (feu) from Friday, bringing the freight rate to US$1,800 per feu. More than 90 per cent of exporters had accepted the upward adjustment, the company said. It came after Maersk Line, the world's largest shipping company, increased freight rates between South Asia and Europe via the Middle East by US$100 per teu. 'We believe that 2010 will be better than 2009, although there are still some uncertainties,' said Leon Zhang Liang, executive director of China Cosco Holdings. 'But the environment remains challenging in light of overcapacity.' The company is seeking further increases on the transpacific trade lanes upon contract renewal in May. The body for transpacific trade has proposed a US$1,000 per feu rate rise. Shares in China Cosco rose 3.62 per cent to HK$10.88 yesterday, while China Shipping Container Lines, the mainland's second-largest container shipping company, surged 7.88 per cent to HK$3.56. China Shipping Development, the largest coastal shipping company for energy products, rose 7 per cent to HK$14.5. Bulk shipping, which transports commodity goods instead of finished products, would perform better than the container shipping sector because the recovery in the global economy would shore up demand for iron ore and coal first, Zhang said. China Cosco, which operates the world's largest fleet of bulk vessel, expects the Baltic Dry Index, tracking the rental of various bulk vessels, to trade between 3,000 and 4,000 points this year. The index closed at 3,295 points on Monday, down four points. 'A seasoned operator will take advantage of volatility in the rental market to make a profit,' Zhang said. 'We will try to rent more vessels at the low level and rent them out when there is an upswing.'