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Freight Market Update: June 14, 2024

deep water port

Ocean freight market update

China-North America

  • Rate changes: Ocean freight rates from China to the US have surged, with prices for the West Coast climbing by nearly 20% and the East Coast by over 10% compared to the previous week. This spike is attributed to early peak season demand, economic recovery signals in North America, and anticipation of new tariffs. Carriers have announced potential additional increases for mid-June and early July.
  • Market changes: The market is experiencing increased congestion at major ports, particularly Singapore, due to an uptick in transshipment activities and vessel delays. This congestion is leading to a significant number of blank sailings, causing further disruptions. Some carriers are reintroducing or adding services to the transpacific routes to capitalize on the high demand, while others are reallocating capacity to address these delays.

China-Europe

  • Rate changes: Rates from China to Europe have also seen an increase of more than 20%, with similar drivers such as economic recovery in Europe and capacity constraints. The Mediterranean routes have witnessed upward trends as well. Carriers are targeting additional General Rate Increases (GRIs) as they brace for the peak season, with further rate hikes anticipated.
  • Market changes: European demand has stabilized despite earlier rate hikes. However, the influx of new ultra-large container vessels and persistent high inventory levels are expected to cap further rate increases. Significant delays and congestion at Asian and European ports continue to disrupt schedules, affecting overall market stability.

Air freight/Express market update

China-US and Europe

  • Rate changes: Air freight rates from China to North America have increased by around 3%, reflecting strong demand. Conversely, rates to Europe have dropped by approximately 12%. Despite these fluctuations, overall air freight rates remain higher than pre-pandemic levels, underscoring ongoing market volatility.
  • Market changes: The air cargo market is grappling with overcapacity issues, with some carriers grounding freighters in anticipation of a market rebound later this year. E-commerce and general cargo demand have softened, contributing to downward pressure on rates. European Cargo is expanding its fleet and routes to capitalize on the upcoming peak season, with a focus on e-commerce shipments from China to the UK. This expansion is expected to provide a cost-effective alternative to traditional hubs, further influencing market dynamics.

Disclaimer: All information and views in this post are provided for reference purposes only and do not constitute any investment or purchase advice. The information quoted in this report is from public market documents and may be subject to change. Alibaba.com makes no warranties or guarantees for the accuracy or integrity of the information above.

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