International shipping and logistics market update - Week 27/2024

International shipping and logistics market update - Week 27/2024

Drewry’s World Container Index for the week 27/2024 continued to increase sharply by 10% compared to the previous week, to 5,868 USD. The freight index increased 298% compared to the same week last year and was 313% higher than the 2019 average before the pandemic (1,420 USD).

Drewry’s World Container Index Week 27/2024 (Photo: Phaata | Source: Drewry)

1. Asia - Northern America route

The freight rates from Asia to the West Coast of North America in the week 27/2024 continued to increase sharply to 7,930 USD/FEU, equivalent to an increase of 12% compared to the previous week, according to Freightos data.

The market entered its peak period. Shipping lines have successfully applied the July 1 General Rate Increase (GRI) to spot freight rates across all export ports from Asia to North America. For fixed prices on long-term contracts, carriers announced new Peak Season Surcharges (PSS) for July 1. The price increase in early July marked another milestone increase of sea freight rates.

Demand is very high, with volumes exceeding last year's figure on the trans-Pacific route due to the impact of shipping vessels having to bypass the Cape of Good Hope and port congestion in Asia and North America. We are seeing more premium services being offered from shipping lines, including expedited shipping services, container facilities and guaranteed slots, as other carriers try to reduce backlogs in Asia by adding more capacity.

Carriers expect these rate increases to continue and accelerate in the short term, as ships leaving Asia are expected to be fully booked through July. Services from Asia to North America were near capacity in July. Routes from Vietnam and South/East China (Yantian/Shanghai/Ningbo) to the US were particularly tight.

Shippers are expecting an extremely difficult peak season and are trying to weather the uncertainties.
 

Asia-US West Coast Freight rate | Week 27/2024 (Image: Phaata.com)

2. Asia - Northern Europe route:

The rate for container shipping from Asia to Northern Europe in the week 27/2024 continued to increase sharply to 8,400 USD/FEU, equivalent to an increase of 18% compared to the previous week, according to Freightos data.

The market continues to be tense and space shortages continued in July. Many factors are at play including port congestion, lack of container equipment and ongoing delays of ships rerouting through the Cape of Good Hope leading to Low reliability and cancellation of many sailings departing from Asia make the situation even more difficult.

Equipment shortages have become severe at most major departure ports in Asia. Shipping lines are rearranging empty containers to improve the situation, but with continued delays of ships rerouting through the Cape of Good Hope, Phaata expects this problem to persist in the coming weeks. .

Strikes in the ports of Bremerhaven, Hamburg and Le Havre have not yet affected schedules, but inland shipping networks risk delays. Customers importing goods to Germany and France should closely monitor deliveries as strikes could last until July if unions do not receive a satisfactory response from the government to their demands .

To provide earlier priority shipping and ensure delays are avoided, many shipping lines are willing to use "Premium" options to prioritize loading onto the earliest sailings along with a set priority level.

Shippers are trying to push delivery schedules earlier to avoid additional shipping costs. All sailings are fully booked unless seats are guaranteed. Shippers should book early, split reservations into smaller lots, and pick up empty containers as soon as possible.

Asia-Northern Europe Freight rate | Week 27/2024 (Image: Phaata.com)

3. Northern America - Asia route:

The freight rates from North America (West Coast) to Asia in the week 27/2024 decreased to 315 USD/FEU, equivalent to a decrease of 3% compared to the previous week, according to Freightos data.

Capacity remains available for vessels sailing from major U.S. ports to discharge ports in Asia, Northern Europe and the Mediterranean.

Some inland rail locations have container equipment problems related to the global disruption of container flows. When making loading reservations at U.S. domestic railroad locations, shippers are advised to make reservations 3-4 weeks in advance of the sailing's departure date.

US West Coast - Asia Freight rate | Week 27/2024 (Image: Phaata.com)

4. Northern Europe-Asia route:

The freight rate from Northern Europe to Asia in the week 27/2024 decreased sharply to 607 USD/FEU, equivalent to a decrease of 7% compared to the previous week.

Northern Europe - Asia Freight rate | Week 27/2024 (Image: Phaata.com)

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Read more:

• Carriers race to charter ships for East-West shipping route
• Red Sea diversion significantly reduces Greece's container volumes
• Container Freight Rates Continue to Soar
• International shipping and logistics market update - Week 26/2024

Source: Phaata.com 

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