Zencargo Market Update: 28th November

China

Ocean

• Spot rates from China to North Europe and the US have continued to decline. 
  • Recent Seas Intelligence data suggests that the Asia-Europe trade volumes have fallen by almost 20% compared with pre-pandemic levels driving rates down.
  • The decline in demand and rates continues as a result of  a myriad of macroeconomic forces including poor consumer demand, rising inflation and the ripple effects from the conflict in Ukraine. 
  • While the  rates continue to fall, carriers are under pressure, with operating costs up to 50% higher than 2019  levels.
• Blank sailings are now at an unprecedented level as carriers grapple with low vessel utilisation.
  • One alliance is blanking as many as 62 voyages on the transpacific lane from weeks 48-52. 
• Anti-lockdown protests have broken out in China threatening supply chain security. 
  • Protestors in  Urumqi have taken to the streets as the city has been in lockdown for more than 100 days.
  • Similar protests have also broken out over the weekend in Shanghai, Beijing, Guangzhou, Wuhan and Chengdu.
  • As these protests continue to unfold the potential impact on supply chains and manufacturing in China is yet to be seen.

Air

Central China to USA and Europe 

• From SHA to Europe,  rates have increased slightly compared with last week and space is tight due to some flight cancellations. 
• From SHA to the USA,  rates have increased slightly compared to last week due to a large order occupying a lot of volume. 
• From NGB to Europe and the USA , rates have increased this week, with the final rate being provided on a case by case basis. 

North China to USA and Europe 

• From TSN to Europe, rates continue to fluctuate and have seen a slight decrease compared to last week. Rates are much lower than at the same time in 2021.
  • Air China, Lufthansa and Singapore airlines can provide spot rates for dense cargo on passenger flights to Europe.
  • Korean Air and Asiana Airlines can provide earlier estimated time of arrivals on their freight flights, with Asiana Airlines providing a competitive rate similar to passenger flights.
  • We recommend booking 3-4 days in advance.
• Similar to Europe, rates from TSN to USA continue to fluctuate and  have seen a slight decrease compared to last week.  Rates are much lower than at the same time in 2021.
  • Japan Airlines, Cathay Pacific and All Nippon Airways can provide spot rates for dense cargo on passenger flights to Europe.
  • Korean Air and Asiana Airlines can provide earlier estimated time of arrivals on their freight flights, with Asiana Airlines providing a competitive rate similar to passenger flights.
  • We recommend booking 5-6 days in advance. 
• From PEK to Europe and the USA, rates have seen a slight decrease compared to last week however space still remains tight. 
  • For urgent shipments to Europe we advise providing the cargo ready date, reconfirm rate and book 3 to 4 days in advance. 
  • For flights from PEK to the USA the available carriers include Japan Airlines, All Nippon Airways and Cathay Pacific. 
    • Due to less available services on PEK to the USA,  some airlines are loading less volume or have cancelled or rescheduled their flights. 
• From TAO to Europe, rates have decreased compared to last week.
  • ETD for new bookings is the 1st December.
• From TAO to the USA, rates have decreased this week compared to last week.
  • ETD for new bookings is the 1st December.
• From CKG to Europe rates have remained stable compared with last week , while rates to the USA have seen a slight increase.
  • Qantas is able to provide direct flights to Chicago and special rate direct flight to Los Angeles 

South China to USA and Europe 

• From CAN to the USA and Europe rates have remained stable since last week and rates can be negotiated with carriers on a case-by-case basis. 
• From SZX to Europe and the USA, the market is stable and rates can be negotiated with carriers on a case-by-case basis. 
• From XMN to Europe and the USA  rates have remained the same compared to last week. Rates can be negotiated with carriers on a case-by-case basis.

USA

Ocean

• The Port of LA and Long Beach are free of cargo backups for the first time since 2020.
  • The ports had been dealing with bottlenecks due to the sudden increase in shipping trade in the second half of 2020 as well as a lack of dock works and equipment.
  • The number of ships waiting at the ports has gradually been falling throughout 2022 as improvements to port design and unloading efficiency have taken effect. 
  • This signifies the end of one of the largest cargo back ups in history.
• The Port of LA has posted its lowest level of October imports since 2009. 
  • This is part has also contributed to the easing of congestion discussed above. 
  • The drop in imports has been attributed to a combination of low consumer demand as well as volume shifts to East Coast ports amid growing concerns of labour issues at West Coast ports.
• A US rail strike could occur in early December if unions and railroad operators are unable to reach a labour agreement.
  • Currently out of the 12 unions which represent railway workers, 8 have voted in favour of agreements, leaving 4 unions at the bargaining table with operators. 
  • If an agreement is not reached and a strike goes ahead it would have serious implications for supply chains as railroads haul about 40% of freight in the US every year.

Benelux

Ocean

• The Port of Rotterdam has announced it will partner with Battolyser Systems to develop a factory to manufacture  green hydrogen equipment.
  • The move represents the port’s latest in a series of hydrogen related deals aimed at reducing carbon emissions in supply chains.
  • Battolyser is seeking to commercialise systems based on iron nickel batteries, which produce hydrogen by electrolysis — using electricity to “split” water — once fully charged.
• The  Container Exchange Route at the  Port of Rotterdam is set to be in action by the end of 2023.
  • The Container Exchange Route (CER) is a closed track for faster, more efficient and integrated transport of containers between locations on the Maasvlakte.
  • The CER will facilitate an efficient exchange of containers between terminals, container depots, distribution centres and customs facilities.
  • The CER is aimed at improving efficiency, reducing risk of congestion and increasing safety at the port.

UK

UK 

Ocean

• The Port of Felixstowe operators remain in talks with unions over pay dispute. 
  • With the Port of Liverpool and Unite Union settling their pay dispute in recent weeks, the Port of Felixstowe continues its talks with Union leaders who are seeking a 10% pay increase. 
  • Union sources have warned that further strikes remain a “real possibility”. 
• Plans have been unveiled for a £2 billion tidal barrier between Lincolnshire and Norfolk. 
  • Developers state that the 11 mile barrage, which would include a deep sea container port and carriage way, would harness tidal energy to power up to 600,000 homes.
  • The deep sea port would have capacity to handle up to 4 million TEUs annually. 
  • Although a planning application is yet to be submitted, the Centre Port Holdings has stated that they hope the project would be operational by 2028 at the earliest.

Road

• Analysts predict the EU trucking industry’s driver shortage will triple by 2026.
  • It is predicted that the rate of unfilled truck driver positions will reach 60% by 2026, representing a shortage of 2 million truck drivers. 
  • Currently in the UK the shortage of drivers is approximately 50,000 and is only set to increase as the  largely older workforce approaches retirement. 
  • The RHA has attributed some of the shortage due to poor working conditions and has called on the government to build new truck stops and ensure driver needs are prioritised. 

European Bank Holidays

We anticipate a shortage of availability and the occurrence of delays around the bank holiday periods. Plan ahead and allow extra time for your products to be delivered.

December 1st – Portugal, Romania

December 2nd – Romania

December 3rd – Spain

December 6th – Finland, Spain 

December 8th – Albania, Andorra, Austria, Italy, Liechtenstein, Macedonia, Malta, Monaco, Portugal, San Marino, Spain, Switzerland* 

December 13th – Malta

December 24th –  Austria*, Bulgaria, Czech Republic, Estonia, Hungary, Latvia, Lithuania, Luxembourg, Slovakia, Sweden

December 25th – Austria, Belgium, Bulgaria, Croatia, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, Netherlands, Poland, Portugal, Romania, Slovakia, Slovenia, Spain, Sweden

December 26th – Austria, Belgium*, Bulgaria, Croatia, Cyprus, Czech Republic, Denmark, Estonia, Finland, France*, Germany, Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, Netherlands, Poland, Romania, Slovakia, Slovenia, Spain*, Sweden

*Not in all regions