Ocean Freight

Global freight rates drop with no pre-Golden Week spike

Spot freight rates on major container lanes continued to fall this week as demand remained flat and no pre-Golden Week surge appeared. With Golden Week starting on 1 October, the expected spike in shipments has not materialised, likely due to concerns over a potential strike on the US east and Gulf coasts.

The period traditionally sees a rush for companies to ship goods out of China before operations become limited, and while that will continue to be the case, we are expecting the rush to be less hectic than in previous years.

This is due to the shift in peak season in 2024, as businesses have looked to get goods to European shores as early as possible amid the ongoing Red Sea situation to ensure they don’t miss key seasonal events.

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Container shipping reliability marginally improves amid potential US port strikes

As potential strikes loom at US east and Gulf coast ports, global container shipping reliability saw slight improvement in August, reaching 52.8%, up 0.7 percentage points from July, according to Sea-Intelligence Consulting. While still low, reliability has stabilised between 50%-55% this year, giving shippers some predictability.

Maersk led with a 54.7% reliability rate, followed by Hapag-Lloyd at 54.3%. Eight carriers, including OOCL and MSC, exceeded 50%, while Pacific International Lines had the lowest at 37.2%.

Prolonged US port strikes could worsen October’s reliability figures.

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Freight rates continue to fall

The biggest drop was on the Asia-North Europe trade, where Drewry’s World Container Index showed a 9% decline on the Shanghai-Rotterdam route to $4,682 per 40ft. However, this is still nearly 300% higher than the same time last year, when rates were plummeting.

Xeneta’s XSI short-term rate for Asia-Europe fell 15% this week, landing at $5,424 per 40ft.

Shipping lines launch new routes between China and Bangladesh amid political tensions

Tens of thousands of dockworkers have gone on strike at major US ports, potentially causing significant trade disruptions ahead of the presidential election and holiday season. Workers from the International Longshoremen's Association (ILA) walked out at 14 ports from Maine to Texas, marking the first major port shutdown in nearly 50 years.

The strike is over stalled negotiations for a six-year contract covering 25,000 port workers. The US Maritime Alliance (USMX) has offered wage increases of nearly 50%, better pensions, and improved healthcare, but the union wants larger pay raises and is concerned about job losses from automation.

The strike could impact key imports like food, clothing, and cars, with potential shortages and price increases if it continues.

Stay ahead of potential disruptions caused by the US port strikes. Contact us today to explore alternative shipping routes and strategies to keep your supply chain running smoothly.

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Shipping lines launch new routes between China and Bangladesh amid political tensions

Following strained political relations between Bangladesh and India, shipping lines are launching new routes to support Bangladesh's trade with China. Pacific International Lines (PIL) has introduced a direct weekly service from China to Chittagong, cutting transit time to eight days, compared to the usual 20-22 days via regional hubs like Singapore.

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Air

Airfreight capacity tightens in Asia ahead of peak season, while ocean freight faces challenges

As the peak airfreight season approaches, most Asian gateways are operating smoothly, but bottlenecks are emerging in Southeast Asia and the Philippines, according to the Dimerco Asia Pacific Freight Report. Despite lower volumes in September, airfreight demand is expected to surge through mid-October, driven by China's Golden Week holiday.

Intra-Asia routes will face the most strain, while long-haul capacity may be redirected to meet demand. Singapore’s Changi Airport is already facing 1-2 day backlogs, while congestion is critical in the Philippines, with some shipments being rerouted. Airfreight capacity is tight across most Asia Pacific gateways to Europe and the US, with only Hong Kong and Taiwan offering sufficient lift to the US.

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Air market braces for high Q4 demand amid capacity crunch  

Ocean freight is also facing issues, with blank sailings causing challenges for exporters. Container shipping cancellations are up 13%, particularly affecting routes from Asia to the US and Europe, leading to declining freight rates.

Charter brokers predict a busy fourth quarter for air freight, with capacity still available—but at a premium. Widebody aircraft availability is tight, driven by strong e-commerce demand, but space can be secured for those willing to pay.

Contact us today to explore our air freight solutions to ensure your cargo reaches its destination efficiently and cost-effectively. Let’s navigate these changes together and keep your supply chain running smoothly.

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