Ocean freight market update
- Rate changes: In the last two weeks, the freight market saw a more significant spot rate decrease compared with the month prior, in both China to the US west and the US east coast lanes. This was attributed by market analysts to a lack of significant volume increase so far, reinforcing pessimistic projections for a peak season rebound in North America. Short term rates are expected to remain under downward pressure in the coming weeks due to various additional factors such as cancelled draft restrictions by the Panama Canal authority, and increased ocean capacity in July and August.
- Market changes: Ocean carriers continue to compete on pricing in the Trans Pacific Eastbound lanes in light of the soft volume demand, in part due to inventory de-stocking in the US not making anticipated progress. With the global macroeconomic environment still dominated by more tightened monetary policies and slow economic growth, the container ship industry will likely face a challenging second half of the year.
- Rate changes: Rates from Asia to both North European and Mediterranean ports also saw a decrease in the last two weeks, albeit not as sharp as the Trans Pacific lanes. Booking intake remains flat on the Far East westbound lanes but the trend is slowly picking up, according to market observers.
- Market changes: Rates remain at a relatively low level as a result of continued low demand and open capacity. High inflation and inventory levels, as well as energy costs are still considered the main factors impacting demand, and those will likely persist into Q3.
Air freight/Express market update
China–US and Europe
- Rate changes: After a long series of weekly declines, an overall air freight index reported a slight increase for the week ending Jun 19, although it edged lower again the week after. Rates out of China to the US and Europe remained quite stable.
- Market changes: In the air cargo market, there are mixed views about a peak season recovery. A schedule increase in passenger capacity for the summer is behind the relatively stable average rates, and relatively strong e-commerce business out of Asia contributed to improved market outlook for airline companies.
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