Transport Update 29th September

Welcome to the Zencargo weekly freight market update – the latest news from our freight and procurement teams on the real experience of shippers.

This week: China’s power cuts and Golden Weekly Holiday

• Ocean

• Air

• Road

Want freight market updates delivered straight to your inbox every week?

In Focus: Power cuts and blackouts before Golden Week promise 

This week’s news from China promises additional disruption as shippers attempt to reinforce inventories before the festive season.

As more parts of the world are reopening after pandemic-induced lockdowns, we’re seeing additional pressure on China’s electricity-hungry factories. Compared with last year, electricity demand is growing this year in China at nearly twice its usual annual pace.

Outages have rippled across most of eastern China such as Guangdong (Shenzhen, Guangzhou, Dounguan), Anhui, Zhejiang (Ningbo), Shandong (Qingdao).

Despite the government’s climate change goals to cut energy consumption, factories have purchased generators to remain at normal production. 

This new challenges comes just before Golden Week. The 7-day holiday begins from October 1st and runs until the 7th. During this period almost all businesses and factories, as well as government organisations will be closed or low-staffed. This means that production will be slowed down or completely stopped. Airports, sea ports and warehouses will be operating with limited capacity whereas customs offices will be closed. 

Ocean

Asia 

1. US market

• • Bookings will be closed from 29th September due to Golden Week. 
  • Space will be very tight and equipment in high demand leading up to the holiday. There will be major challenges due to the reduced capacity and staff shortages due to the pandemic. So longer lead times should be expected. 
  • Rates and space must be checked on a case-by-case basis. 

2.  EU market (base airport like FRA/AMS/LUX, etc)

• • Bookings will be closed from 29th September due to Golden Week. 
  • Space will be very tight and equipment in high demand leading up to the holiday. There will be major challenges due to the reduced capacity and staff shortages due to the pandemic. So longer lead times should be expected. 
  • Passenger flights are fully booked until 8th Oct. There is some remaining space on freighter flights but will need to be booked up quickly.
  • Rates and space must be checked on a case-by-case basis.

3. UK market

• • Bookings will be closed from 29th September due to Golden Week. 
  • Space will be very tight and equipment in high demand leading up to the holiday. There will be major challenges due to the reduced capacity and staff shortages due to the pandemic. So longer lead times should be expected.
  • Passenger flights are fully booked until 8th Oct. There is some remaining space on freighter flights but will need to be booked up quickly. 
  • Over the past 2 weeks there has been an unprecedented rise in volume across imports and exports to and from the UK. Airlines are struggling with the increase in volume which is resulting in increased waiting times.
  • Rates and space must be checked on a case-by-case basis.

Americas

• Rates into Asia, UK and Europe remain mostly the same this week
• USA is set to lift travel ban for most noncitizens from November, so long as they are vaccinated. The eased rules are expected to drive up demand for transatlantic travel. This is good news for the air freight industry as this will no doubt bring more flights and capacity for cargo. 
• ORD is still over capacity and there are issues over release updates. Forwarders are having to send in trucks to collect without knowing if freight is ready and the ground handling agents aren’t answering their phones 
• Forwarders are choosing to use smaller airports as much as possible as there is less congestion. Freight rates will be higher but there is less chance of incurring additional costs for attempted pickups, waiting time and storage. 
• LAX is still a challenge, there are usually waiting time charges applied to most shipments due to the long queues to collect/deliver into the ground handling agents warehouse

Europe/UK

• Rates into Asia and North America remain stable as there seems to be enough capacity to meet demand.
• USA is set to lift travel ban for most noncitizens from November, so long as they are vaccinated. The eased rules are expected to drive up demand for transatlantic travel. This is good news for the air freight industry as this will no doubt bring more flights and capacity for cargo.

Road

News

• The UK are currently suffering a fuel crisis due to panic buying from consumers
  • Competition law is to be suspended to allow fuel companies to coordinate where they can send their supplies
• The UK government have urged former lorry drivers to get behind the wheel to help solve labour shortages. 
  • They have announced a temporary visa scheme for 5,000 EU lorry drivers 

UK Haulage

• Continuing to see deterioration in the market which will continue until Christmas 
  • Hauliers are currently full for October
  • Containerlift is now operating up to three weeks in advance 
  • Urgent deliveries are available but prices are up to 3 times that of standard deliveries
• Storage
  • Felixstowe have a backlog of over a 1000 boxes to move 
  • To move anything, there is a wait of about a week 
  • Pentalver Felixstowe have asked customers to move boxes within 48 hours regardless of a contract or spot movement
  • Freightliner Laden Deepstore
    • Any laden container that has not left the terminal for delivery on day 11 with no special agreement will be moved to deep storage
    • Any laden container that is moved to the deep storage stack will incur the following additional charges;
      • Lift into stack – £65.00
      • Lift out of stack – £65.00
    • Once in deep storage stack following charge will replace standard charges
      • Storage Charges – £28.00 per TEU Per Day (Including weekends/Bank Holidays)
    • Terminals will require 3 full working days of notice in order to make containers available from the deep storage stack when being released for final delivery. 

The route ahead

The information that is available in the Weekly Market Update comes from a variety of online sources, partners and our own teams. Click below to learn more about how Zencargo can help make your supply chain your competitive advantage.

Get In Touch