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Logistics News Collection (May 21): Asia-Europe Rates Expected to Stay High, US Boosts Airfreight Infrastructure

cargos at the airport

Air

US Opens Funding Tap to Boost Airport Air freight Flows

The US government has allocated $105 billion over four years to improve air traffic control, airport operations, and infrastructure. This initiative aims to alleviate congestion, enhance safety, and support future growth. Included in the package is $19.35 billion specifically for airport infrastructure improvements, addressing long standing cargo congestion issues. The legislation also calls for recruiting more air traffic controllers to ease flight constraints. Industry stakeholders welcome this move, seeing it as a significant step toward modernizing the US aviation system.

Maersk Airline Prepares to Deploy First 777 Freighters for Peak Season

Maersk is set to launch its first two Boeing 777 freighters in preparation for the peak shipping season. This expansion is part of Maersk’s broader strategy to enhance its air cargo services, integrating more airfreight capabilities into its logistics operations. The new 777 freighters will be stationed at Maersk’s main base in Billund, Denmark, and will be operational by late summer or early autumn. This move comes as other airlines scale back due to financial strains, highlighting Maersk’s commitment to growing its air cargo business.

Ocean

Futures Market Bets on Asia-Europe Rates Staying High Till October

The futures market indicates that Asia-North Europe freight rates are expected to remain elevated until October 2024. This prediction is based on high trading volumes of China’s container shipping futures, reflecting tight supply of ships and equipment. The EC2408 contract closed at $4,192, showing a significant increase from the previous week. Analysts suggest that spot freight rates on the Shanghai to North Europe route could rise by another 35% by August. This scenario contrasts with carriers’ bearish earnings forecasts, highlighting the complex dynamics of the shipping market.

Red Sea Crisis Turns Lome into Key Transhipment Hub on MSC’s Ex-Asia Services

The ongoing crisis in the Red Sea has led to the emergence of Lome, Togo, as a critical transhipment hub for MSC’s services from Asia. Lome is strategically positioned to handle large container ships and is now a focal point for MSC’s expanded port rotation. The port’s infrastructure allows it to service vessels with capacities up to sixteen thousand TEU, facilitating efficient cargo movement. MSC’s investment in Lome, including a $500 million expansion plan, underscores its importance in the global shipping network.

Land

April Intermodal Volumes Turn in Solid Performance, Reports IANA

Intermodal volumes in April 2024 showed robust growth, with a 12% year-over-year increase, totaling a thousand four hundred and fifty six thousand two hundred and forty one units. Domestic containers rose by nearly 7%, while international containers saw a 20% increase. This growth continues the positive trend from the first quarter, driven by strong consumer demand and efficient inventory management. The Intermodal Association of North America (IANA) expects volumes to remain steady, anticipating a typical peak season in August and September. The outlook for 2024 includes a projected 2.4% annual increase in total intermodal volume.

Other (Intermodal/Supply Chain/Global Trade)

Walmart and Amazon Ramp Up Same-Day and Next-Day Delivery Volume

Walmart reported delivering 4.4 billion items with same-day or next-day shipping speeds over the past 12 months, with 20% of deliveries occurring in under three hours. This performance compares favorably to Amazon, which delivered over 4 billion items in the same timeframe. Walmart’s extensive store network has enabled it to meet growing online demand efficiently. The retailer has also improved delivery speeds internationally, with significant gains in India and China. These efforts have reduced delivery costs per order by nearly 40% in the US.

US FAA Legislation Includes Review of Airport Truck Delays

The newly signed Federal Aviation Administration (FAA) Reauthorization Act includes a provision for reviewing truck congestion at US airports. This review will be conducted by the General Accountability Office over the next year, addressing infrastructure issues that cause delays. The legislation aims to modernize the US aviation system with over $105 billion allocated for improvements. Industry associations such as the Airforwarders Association and the National Customs Brokers and Forwarders Association played a key role in advocating for these changes. The review is expected to lead to significant enhancements in air cargo operations and efficiency.

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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