International shipping and logistics market (updated week 51/2021)

Update on the international logistics and container shipping market on Asia, Europe and North America routes in the week of 51/2021.

container-freight-rates

Update the international shipping and logistics market for the week of 51/2021

1. Asia - North America route

China's pre-Lunar New Year demand remains strong and many sailing cancellations have been reported. Space is expected to be very scarce on the Asia-North America service until the end of 2021 and continue until early 2022. Fewer spaces and continued demand are putting pressure on the market and will provide an impetus for higher rates.

According to some industry experts, volume on the Asia-North America route will increase sharply in the first half of 2022. After the Golden Week, freight rates will decrease slightly and there will be more seats. However, due to high demand, capacity and sailings before the Lunar New Year are limited and are expected to increase rates sharply in the near term.

Other challenges such as congestion, delays, schedule slippage, and early closure of feeder port operations continue to affect the Asia-North America service.

Around 15% of capacity in December could be considered underutilized due to delays related to congestion, schedule slippage and schedule restoration measures from shipping lines.

Congestion at the ports of Los Angeles/Long beach and Savannah remains severe. Meanwhile, recent weather events pose additional challenges in Vancouver.

- Ocean Freight: Freight rates remain high and are expected to see a sharp increase in January due to increased demand before the Lunar New Year. Shippers and importers in the US are converting past bookings from standard service to premium service.

- Space: Serious lack of space.

- Empty container equipment: Serious lack of equipment.

Recommendation: Shippers should continue to book at least 4-6 weeks before ETD for the best chance of guarantee. Shippers consider choosing to deliver at coastal destinations instead of inland due to connection delays between shipping modes.

2. Asia - Europe route:

Spaces and container equipments continue to be scarce as market demand continuously exceeds supply. Freight rates have remained very high for a long time.

Spaces and equipments are still very scarce due to frequent blank sailings and port congestions. Shipping lines have received too many bookings and are restricting the acceptance of new bookings.

With delays and constant sailing changes, low schedule and sailings delays before the Lunar New Year will have a big impact on the period after the Lunar New Year.

- Ocean Freight: Rates remain stable at a high level. Most shipping lines have extended their rates to December. As the market is about to enter the peak season before the Lunar New Year, freight rates are expected to increase in January.

- Space: Serious shortage

- Container equipment: Serious shortage in all Asian countries.

Recommendation: Shippers should make reservations at least 4-5 weeks before the scheduled train runs. Consider choosing a guaranteed service and have the flexibility to choose replacement equipment when needed.

3. North America - Asia route:

Incoming vessel numbers and available capacity remained stable for US West Coast ports. Capacity on the US East Coast of the United States has improved.

The integrity of the schedule is impaired. There are many blank sailings and delays, which are creating great challenges with the ship's arrival and departure dates being announced.

- Ocean Freight: In December, GRI was applied to ports of entry in India and Australia. The general rate increase (GRI) surcharge for January is expected to apply to select ports of entry in Southeast Asia and Oceania.

- Space: Space is extremely scarce for West Coast ports, but has improved in US East Coast ports.

- Container equipment: The shortage of container equipment is still causing difficulties for goods transported from within the US, especially at major ports.

Recommendation: Shippers make reservations at least 4-6 weeks before ETD.