International shipping and logistics market - Week 22/2022

International logistics and container shipping market on Asia, Europe and North America routes in the week of 22/2022.

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International shipping and logistics market update for the week of 22/2022

1. Asia - North America route

Capacity continued to be maintained as signs of congestion worsened.

Shipping demand on the Asia-North America route was constrained by many factors such as the continued impact of Covid on Shanghai, high multi-month inventory levels, and global economic developments. Shanghai is gradually opening up after nearly 2 months of closure. However, there is still uncertainty about what demand will be like once the lockdown measures in China are over. Some warn that a spike in demand will again put pressure on destination ports and inland hubs.

For goods that are already in stock, US importers can take advantage of existing market space along with better spot rates.

Labor negotiations by the International Labor and Warehouse Federation of America (ILWU) and the Pacific Maritime Association (PMA) are set to begin and stakeholders await news on possible effects.

- Freight rates: Freight rates have been on a downward trend in many areas, especially into the US West Coast ports. According to Xeneta, freight rates from Asia to the US West Coast this week is at $8,004/FEU, down 3.64% from last week and down 7.21% from last month.

- Space: Most are available

- Empty container equipment: Improved.

Recommendation: Shippers should continue to book at least 2 weeks before estimated time of departure (ETD) for the best chance; Consider switching from a standard service to a premium guaranteed service. Monitor and check closely with suppliers to capture any Covid-19 related impacts or changes on their production and forecasts quickly to adjust accordingly fast.

Freight rates Asia- US West Coast | Week 22/22

Freight rates Asia- US West Coast | Week 22/22 (Image: Phaata.com)

2. Asia - Europe route:

Demand is growing, but congestion is still having a major impact on capacity deployed on this route. Shanghai is gradually opening up after nearly 2 months of lockdown.

Q3 is expected to pick up strongly with a peak in the summer. However, there are many macro uncertainties such as the Ukraine conflict, high inflation across Europe, and falling consumer confidence.

Severe congestion at European ports is delaying return sailings to Asia, leading to more delays and cancellations.

- Freight rates: Freight rates tend to increase in June due to more scarce space. Rates from Asia to Northern Europe is at $10,450/FEU, up 0.85% from last week and down 2.84% month on month, according to Xeneta data.

- Space: The space is starting to fill up again.

- Empty container equipment: Improved but still lacking in many Asian countries.

Recommendation: Shippers should make reservations at least 2 weeks before estimated time of departure (ETD). Consider choosing a guaranteed service and have the flexibility to choose replacement equipment when needed.

Freight rates Asia-Europe | Week 22/22

Freight rates Asia-Europe | Week 22/22 (Image: Phaata.com)

3. North America - Asia route:

Vessel arrivals and capacity availability remained stable for all US West Coast ports.

More sailings are expected to be blanked due to the large number of sailings waiting in Shanghai.

The East Coast region continues to see challenges with vessel congestion and a number of shipping lines having dropped out of the Charleston and Savannah ports.

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

- Ocean freight: According to Xeneta, freight rates from North America to Asia this week is at $1,099/FEU, down 0.81% from last week and down 2.92% from last month. Shipping lines have announced the application of a limited GRI (general rate increase) surcharge in June.

- Space: Stable for West Coast ports, and has improved in US East Coast ports.

- Empty 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 weeks or more before estimated time of departure (ETD).

Freight rates US West Coast - Asia | Week 22/22