Trends to Watch

[ILA – USMX Labor Dispute Update]

• In a statement released yesterday evening, the ILA and USMX announced they have reached a tentative agreement on a new six-year master agreement, averting a strike.
• The agreement comes just one week before the parties’ existing contract extension expires on January 15. Formal negotiations resumed on Tuesday (January 7) of this week, preceded by a secret meeting two days earlier, where ILA and USMX representatives intended to make headway on the central issue of automation, CNBC reported. A document from Sunday’s meeting indicated “a focus on the creation of new human jobs to complement any new port technology.”
• The ILA and USMX will continue to operate under their current contract until the new contract is ratified. More details will be released after ILA and USMX members approve the final document.
• Get the full breakdown on our live ILA-USMX blog.

[Ocean – TPEB]

• Rates: With Lunar New Year around the corner, ocean carriers have implemented a General Rate Increase (GRI) effective January 1, along with mitigation starting this second week of January.
• Multiple carriers had announced and planned for ILA-disruption-related charges with varying amounts, start dates, and methods of charging. In light of the tentative agreement, many carriers (including Maersk, ONE, ZIM, and EMC) have begun canceling these surcharges.
• Peak Season Surcharges (PSSs) remain, as there have been no changes yet since the January 1 announcement.
• Equipment: No significant equipment issues have been reported at origin. But with Lunar New Year around the corner, we will start to see pressure on equipment and truckers—especially in light of potential new tariffs.
• Space: Amid the pre-Lunar-New-Year rush, space remains constrained. However, there are some strings with open space, especially to the West Coast.
• Carriers have planned some blank sailings for Lunar New Year.

[Ocean – FEWB]

• Lunar New Year factory closures are expected to be concentrated around Weeks 3-4. This will slightly lower market demand; however, the impact will be mitigated by ongoing carrier equipment shortages. As a result, we anticipate that market Freight All Kinds (FAK) rates will remain stable with slight downward adjustments.
• Market prices remain high, hovering around $4,800-$5,000/FEU. The earlier-than-usual Lunar New Year this year, combined with the short period between Christmas and Lunar New Year, has significantly narrowed the production and transportation window. Consequently, the expected pre-Lunar-New-Year shipment rush has not been observed, and is unlikely to occur before Lunar New Year.
• Carriers are prioritizing profitable space utilization over simply increasing overall utilization. This approach, coupled with equipment limitations, is the basic motivation behind carriers’ higher rate levels.
• Before carrier changes and string service upgrades in February, we predict carriers will establish rolling pools to ensure a smooth transition by late January. This is a typical carrier space management measure during Lunar New Year to ensure lifting balances as well.
• Some carriers may prefer to deploy their own operating vessels during this period. Please remain flexible regarding cargo ready date (CRD) and estimated time of departure (ETD) schedules, or substitute equipment options to minimize space release/delay risk.

[Ocean – TAWB]

• Many carriers had announced ILA disruption charges. In light of the tentative agreement, many (including Maersk, ONE, ZIM, and EMC) have begun canceling these surcharges.
• Additionally, some carriers had planned to implement GRIs on January 15 in light of the now-averted strike. We will share more details as carriers finalize changes.
• Blank sailings are continuing in January, with almost all alliances announcing blank sailings until Week 5.
• New services will start in February.

[Air – Global] (Source: Baltic Air Freight Index)

• Global trends:
  • The Baltic Air Freight Index dropped 3.7% by January 6, reflecting a decline in air freight rates.
  • Despite the dip, the index remains 25.9% higher year-over-year, showcasing resilience in the market.
• China export routes:
  • Rates from Hong Kong fell by 11.1% week-over-week, but are still up 14% compared to last year.
  • Shanghai experienced a 6.8% week-over-week drop, yet rates remain 37.6% above last year’s levels.
• Southeast Asia developments:
  • Rates to Europe increased from Bangkok and Vietnam.
  • Vietnam-to-U.S. rates saw a decline.
  • India witnessed slight rate decreases in both export and import directions.
• European market shifts:
  • Frankfurt’s outbound rates surged 19.8% week-over-week, translating to a 40.8% year-over-year increase.
  • London’s North-America-bound rates rose, but overall rates fell 5.8% week-over-week, remaining 19.4% higher than the previous year.
• U.S. market activity:
  • Chicago’s outbound rates rebounded post-holiday, climbing 16.3% week-over-week and 30.9% year-over-year.

Please reach out to your account representative for details on any impacts to your shipments.

North America Vessel Dwell Times

 

 

This Week in News

Limited disruption likely as new carrier alliances roll out: Alphaliner

Ocean carriers are set to launch new global networks on February 1, 2025, involving major alliances like Gemini Cooperation, Premier Alliance, and MSC. While some disruption is expected, key factors will limit its impact, such as the resolution of the ILA-USMX dispute. The Lunar New Year slowdown will also give carriers time to adjust. Though there will be some skipped sailings, most ships are already positioned, and repositioning of vessels from trans-Pacific services will help mitigate capacity shortages.

Trump aims tariffs at Denmark, an exporter of insulin and hearing aids

Donald Trump threatened to impose “very high” tariffs on Denmark if the country resists his offer to buy Greenland, a move that would likely strain trade relations. While Denmark is a relatively small trading partner for the U.S. (ranked 41st), such tariffs could impact industries that rely on Danish imports, especially pharmaceuticals and hearing aids. More than 75% of U.S. insulin imports by value and a significant portion of hearing aids come from Denmark.

Transportation pricing index hits highest level since freight recession began

In December, transportation price growth rates saw a significant surge, reaching their highest point in over two years, according to the Logistics Managers’ Index (LMI). Transportation capacity, on the other hand, showed modest growth—far behind the rise in prices. Additionally, both upstream and downstream companies expect inventories to rise significantly over the next year.

Flexport Ocean Timeliness Indicator

This week, the Flexport OTI jumped for China to North Europe, and stabilized for China to the U.S. East Coast. Meanwhile, China to the U.S. West Coast broke its descent.

Week to January 6, 2025

This week, the Ocean Timeliness Indicator (OTI) has jumped to a new high for China to North Europe, rising from from 67 to 77 days. Meanwhile, China to the U.S. West Coast broke its descent by moving from 33 to 34.5 days. China to the U.S. East Coast plateaued at 63 days, falling from 63.5 days.

 

A Holiday Message

Dear readers, as the holiday season approaches, we want to take a moment to express our appreciation for your support throughout the year. This will be our final newsletter of 2024, but we look forward to resuming with fresh updates starting the week of January 6, 2025!

Without further ado, let’s dive into this week’s updates.

Trends to Watch

[Ocean – TPEB]

• Rates: Shipping lines successfully implemented a General Rate Increase (GRI) as of December 15th, with only minor adjustments and rate corrections observed so far. The first Peak Season Surcharge (PSS) announcements indicate a planned increase for January 2025.
• Blank sailing: A moderate blank sailing program was in place for December 2024, with 92% available capacity. For January 2025, capacity is expected to be 97%. Additional blank sailings are likely to be announced soon for January and February to account for the Lunar New Year and network changes on the Transpacific trade lane.
• Equipment: No significant equipment (EQ) issues have been reported at origin.

[Ocean – FEWB]

• Demand: Market demand matches operating capacity, supporting stable rates.
• Supply: Market volume is stronger compared to November, but supply capacity is sufficient. Vessel return speed is a key factor influencing the supply side.
• Rates: 2H December FEWB FAK rates remain stable, with Shanghai Containerized Freight Index (SCFI) fluctuations within a narrow range.
• Equipment: There have been occasional equipment shortages at major Chinese ports, but they remain manageable. Timely Equipment Interchange Receipt (EIR) printing and earlier equipment pickups can reduce the risk of missed cargo loading for clients.

[Ocean – TAWB]

• Capacity: Demand remains high due to the possibility of a potential ILA strike on the 15th of January. Canadian ports still face congestion due to recent strikes.
• Space: Space is still limited, primarily in the WMED, where even extra loaders are running full for WMED and NEUR. EMED services are almost running full.
• Rates: 2H of December followed the same trend as 1H of December, along with November. For January, the majority of carriers are extending their rates.

[Air – Global] Mon 02 Dec – Sun 08 Dec 2024 (Week 49):

• Spot rate growth (Week 49, WoW & YoY): Global average spot rates rose by +4% WoW to $3.30/kg, reaching a 2024 high. Asia-Pacific origins saw an +8% WoW increase to $4.86/kg, up +19% YoY. Spot rates from Africa increased +12% WoW, while Europe origins rose +3% WoW to $2.93/kg, with a +4% WoW rise to North America ($3.97/kg).
• Regional spot rate trends (Asia to Europe): Taiwan to Europe rates surged +20% WoW to $4.76/kg, while China to Europe increased +12% WoW to $5.52/kg. Hong Kong to Europe rates dipped slightly (-1% WoW), but remained elevated at $6.22/kg. Significant YoY increases to Europe were noted from Indonesia (+94%), Thailand (+67%), Malaysia (+50%), Singapore (+42%), and Vietnam (+30%).
• Tonnage trends (Week 49, WoW): Global air cargo tonnages rose +1% WoW, driven by a +14% WoW rebound from North America origins (+15% from the U.S.). Notable WoW volume increases were seen on lanes from China to the U.S. (+10%) and Europe (+12%).
• Year-on-year (YoY) spot rate overview (Week 49): Average worldwide spot rates rose +21% YoY, led by Middle East & South Asia origins (+62%), the Asia-Pacific (+19%), and Europe (+19%).

Source: worldacd.com

Please reach out to your account representative for details on any impacts to your shipments.

North America Vessel Dwell Times

 

 

Webinars On-Demand

In case you missed one our webinars this month, watch the on-demand versions below:

Air Market Predictions for 2025

Global Logistics Outlook: Key Trends, Technology, and Strategies for 2025

Unboxing Holiday Trends: Learnings from Black Friday & Cyber Monday

Flexport Customs: Navigating T86, Section 321, and Potential Regulatory Changes

North America Freight Market Update Live

UNICEF & Flexport: The Complexities of Shipping Humanitarian Aid

This Week in News

Domino effects await if ILA strikes again: analyst

With negotiations stalled between the ILA and the US Maritime Alliance, a potential January 15th strike is already shaking up supply chains. Importers have rushed to move cargo, but options like rerouting are quickly disappearing. A strike would bring vessel delays, cargo diversions, export capacity shortages, and prolonged port congestion, especially with new shipping alliance networks adding to the disruption. If the strike drags on, the ripple effects could impact global trade well into March, making a resolution increasingly urgent.

Lunar cargo rush, poor weather clog major Asia ports

Major Asian ports, including Shanghai, Tokyo, Ningbo, Busan, and Manila, face berthing delays of up to five days due to a pre-Lunar New Year cargo rush and weather disruptions. High yard density, vessel bunching, and seasonal closures are compounding the congestion, with similar delays reported at European ports like Rotterdam and Hamburg. Delays are expected to worsen as late vessels return to Asia.

Growth in air cargo demand to decelerate in 2025, IATA says

Air cargo growth will slow to 5.8% in 2025, reaching 80 million tons, fueled by ecommerce and ocean shipping delays, IATA reports. Revenue is expected to rise to $157 billion, with yields remaining 30% above pre-pandemic levels. Capacity growth will lag demand due to freighter production delays. Global airline revenues are set to reach $1 trillion, with $36.6 billion in net profits. Lower fuel costs and efficiency gains will support margins, but rising labor and nonfuel expenses, along with supply chain and regulatory uncertainties, pose challenges. Airlines must focus on cost control to maintain profitability.

Flexport Ocean Timeliness Indicator

This week, the Flexport OTI showed potentially meaningful fluctuations as out-of-pattern moves emerged for both China to North Europe and China to the U.S. West Coast. Meanwhile, China to the U.S. East Coast exhibited a slight drop.

Week to December 16, 2024

This week, the Ocean Timeliness Indicator (OTI) has dropped for China to the U.S. West Coast, falling from 35.5 to 34.5 days. China to the U.S. East Coast has shown a minor drop, moving from 63 to 62.5 days. Meanwhile, China to Northern Europe jumped from 70.5 to 72 days.

 

Trends to Watch

[Ocean – TPEB]

• Rates: Shipping lines are pushing for a General Rate Increase (GRI) on December 15th due to strong bookings ahead of the holiday season in the USA and the typical Lunar New Year cargo surge.
• Peak Season Surcharge (PSS): Initial PSS announcements indicate a rate increase for January 2025.
• Equipment: Equipment is fluid with no issues reported by carriers.

[Ocean – FEWB]

• Space: Demand remains modest, and additional loaders are scheduled for the second half of December. Space is manageable, so carriers may extend or reduce 2H December FAK rates to ensure optimal vessel utilization.
• Rates: The Shanghai Containerized Freight Index (SCFI) declined by $9/TEU in Week 50. With slowing demand, further decreases are expected until the January GRI is implemented.
• Equipment: To avoid equipment shortages caused by vessel delays or blank sailings, we highly recommend picking up empty containers immediately after carriers release them.
• Weight restrictions: Most carriers continue to impose weight restrictions to optimize vessel capacity. Please avoid loading heavy 20’ containers, as they may be rejected.

[Ocean – TAWB]

• Capacity: January vessel capacity is expected to remain full for departures from both Northern and Southern Europe.
• Blank sailings: Blank sailings are anticipated during Weeks 51, 52, and 01, primarily affecting the U.S. East Coast and Canada services.
• Equipment availability: Equipment availability remains tight in certain areas of Central Europe and Southeast Germany.
• Rates: Most carriers are extending their FAK rates through the end of January, coinciding with the conclusion of the current network.

[Air – Global] Mon 25 Nov – Sun 01 Dec 2024 (Week 48):

• Global air cargo rates: November rates reached $2.76 per kilo, the highest of 2024, up +6% MoM and +11% YoY. Spot rates rose to $3.09 per kilo (+21% YoY), while contract rates averaged $2.67 per kilo (+10% YoY). Week 48 saw further rate increases (+2% WoW) to $2.84 per kilo, with spot rates up +3% WoW to $3.22 per kilo.
• Tonnage trends: Global tonnages in November declined -2% MoM, driven by a sharp drop in MESA (-11%) and Europe (-4%), linked to reduced passenger belly capacity. Week 48 chargeable weight dipped -3% WoW, largely due to a -17% WoW decline from North America during Thanksgiving week. Excluding the USA, global tonnages were stable.
• Asia-Pacific and Americas trends: Strong performance in rates and tonnages continued in Asia-Pacific origins to Europe: Rates from key origins such as China, Hong Kong, Japan, and Taiwan rose +3% to +9% WoW, with a YoY increase of +24% to +46%. Tonnages to Europe from the Asia-Pacific were also significantly up YoY (+20%-29% from China, Hong Kong, and Japan).
• From the Americas: Central and South America (CSA) rates increased +9% MoM, reflecting robust demand. North America spot rates rose +3% WoW, despite Thanksgiving disruptions.
• Tonnage growth to Europe: Week 48 saw YoY tonnage increases from multiple regions to Europe: Asia-Pacific (China +24%, Hong Kong +27%, Japan +29%, Vietnam +25%). Americas: Steady growth from CSA origins, contributing to overall market strength.

Source: worldacd.com

Please reach out to your account representative for details on any impacts to your shipments.

North America Vessel Dwell Times

 

 

Webinars

European Freight Market Update Live

Tuesday, December 17 at 15:00 GMT / 16:00 CET

This Week in News

Trans-Pac settles into sedate December before New Year’s uncertainties

The Trans-Pacific freight market has slowed in December after heavy frontloading, and faces potential disruptions from labor negotiations, potential tariffs from the incoming Trump administration, and an early Lunar New Year. Spot rates to the U.S. West Coast have dropped sharply, with variable pricing intensifying market complexity. A potential January 15 ILA strike and elevated inventory levels add pressure as importers prepare for spring shipments. Despite these challenges, record container volumes are projected for January, driven by strong Asia-West Coast trade.

How Generative AI Improves Supply Chain Management

Large language models (LLMs) are revolutionizing supply chain management by enabling rapid insights, scenario analyses, and updates in minutes rather than days. These tools help planners understand system decisions, analyze trends, and answer “what-if” questions by translating human queries into actionable data insights. Early adopters like Microsoft have seen significant efficiency gains, with LLMs supporting server deployments and cost analysis across global data centers.

Trump’s tariffs could spark price hikes, supply chain disruptions, experts say

President-elect Trump’s proposed tariffs on imports from China, Mexico, and Canada could disrupt North American supply chains, raising costs and prices for consumers. Businesses are concerned about timing and implementation, particularly in sectors like automotive and ecommerce. Experts predict increased costs, inflation, and supply chain shifts to regions like India and Vietnam. Small and medium-sized retailers are likely to face the most challenges, and may struggle to manage profitability amid these changes.

Flexport Ocean Timeliness Indicator

This week, the Flexport OTI is showing minor fluctuations. China to the U.S. West Coast has exhibited a small drop, China to the U.S. East Coast has shown a small uptick, and China to North Europe has plateaued.

Week to December 9, 2024

This week, the Ocean Timeliness Indicator (OTI) has dropped for China to the U.S. West Coast, falling from 36 to 35.5 days. China to the U.S. East Coast has shown a minor uptick, moving from 62.5 to 63 days. Meanwhile, China to Northern Europe remained stable at 70.5 days.

 

Trends to Watch

[ILA – USMX Labor Dispute Update]

• The International Longshoremen’s Association (ILA) and the employer group United States Maritime Alliance (USMX) are locked in another dispute surrounding automation at American ports, with less than a month and a half to go before the January 15, 2025 deadline.
• In a Monday (December 2) Facebook post, ILA Executive VP Dennis Daggett criticized semi-automated rail-mounted gantry cranes (RMGs) for eliminating jobs and posing national security risks.
• In a response released on December 3, the USMX defended automation as essential for port modernization and addressing land constraints.
• No negotiations are currently underway. Follow our live blog for more updates.

[Ocean – TPEB]

• Rates: Floating rates continue to ease for the West Coast, with open space to both the Pacific Southwest and Northwest. Carriers are eyeing a Dec. 15 General Rate Increase (GRI), pending confirmation, based on pre-tariff and pre-Lunar New Year cargo surges.
• Space: East Coast and Gulf services remain tight, with most strings full through mid-December.
• Peak Season Surcharge (PSS): No further PSS reliefs we head into the last month of the year.

[Ocean – FEWB]

• Rates: 1H December GRI was announced at $6,000–6,200/FEU, but settled at $5,300–5,500/FEU. The Shanghai Containerized Freight Index (SCFI) rose by $558/TEU in Week 49, reflecting GRI implementation. Rates are expected to increase slightly with floating rate adjustments before easing in 2H Dec.
• Space: Space was full in 1H Dec due to late November overflow. However, with no strong demand upticks or additional loaders arriving, space in 2H Dec is manageable. Premium options are available for those requiring firm space on earlier estimated times of departure (ETDs) or specific service/transit times.
• Premium options: Occasional equipment shortages persist at main Chinese ports, but remain manageable.

[Ocean – TAWB]

• Space: Vessel capacity remains tight due to blank sailings and high demand from both North and South Europe. Restructuring-related blank sailings are expected to continue until the last week of January in 2025, when the new network launches.
• Extra charges: Some carriers have announced 2025 emission charges, combining the EU Emissions Trading System (EU ETS) and FuelEU Maritime Regulation, with increases of 55-75%.
• Rates: December rates remain stable for most carriers, following November trends for North and South Europe, with slight adjustments in the East Mediterranean, particularly Turkey.

[Air – Global] Mon 18 Nov – Sun 24 Nov 2024 (Week 47):

• Rates at peak levels: Global average rates rose +4% WoW to $3.21, driven by spot rate increases of +12% from North America and +8% from Europe, marking the highest levels in 2024.
• Year-on-year gains: Rates globally are up +10% YoY, with spot rates +22% YoY and Asia Pacific/Middle East rates climbing +10% and +48% YoY, respectively. North America remains below 2023 levels.
• Capacity shifts impacting dynamics: -3% YoY Transatlantic capacity reduction contrasts with +7% YoY growth in Asia-Pacific-North America routes, reflecting increased ecommerce demand.
• Thanksgiving boosts tonnage: North America’s chargeable weight surged +22% YoY, driven by holiday timing (Thanksgiving this year CW48 iso 47), while global tonnages held steady WoW, with only Central and South America growing +3% WoW.

Source: worldacd.com

Please reach out to your account representative for details on any impacts to your shipments.

North America Vessel Dwell Times

 

 

This Week in News

Flexport CEO: Companies already shifting imports to West Coast as another possible port strike looms — CNBC

Ryan Petersen, Flexport’s founder and CEO, appeared on CNBC’s Closing Bell: Overtime last Friday (November 29) to share his perspective on the holiday shopping season amid looming challenges, including the potential for a second East Coast port strike, tariff uncertainties, and more. As retailers are entering the holiday season facing significant headwinds: a shortened shopping period, the potential effects of President-elect Trump’s proposed tariffs, and lingering disruptions from October’s port strike, Petersen described this holiday season as the most challenging year-end for businesses since the onset of COVID-19.

Flexport is using generative AI to create the “holy grail” of shipping — Freethink

Flexport uses AI to modernize global trade logistics. The company employs generative AI to digitize documents, streamline communication with truckers via AI bots, and develop “knowledge agents” that centralize expertise on trade regulations and logistics. These innovations aim to automate 50% of manual tasks by 2025, reducing global shipping costs by 5%.

ILA targets rail-mounted gantry cranes amid impasse in port labor talks — Journal of Commerce

The International Longshoremen’s Association (ILA) is at an impasse with the US Maritime Alliance (USMX) over the introduction of semi-automated rail-mounted gantry cranes (RMGs), a key point in ongoing contract negotiations to avoid a January port strike. While RMGs increase terminal capacity and efficiency, especially in land-constrained East Coast ports, the union views them as a threat to jobs, safety, and national security, citing risks of hacking and job elimination. The USMX argues that embracing automation is essential for ports to remain competitive, but the ILA remains firm, framing the fight as a pivotal moment for the union’s future.

Flexport Ocean Timeliness Indicator

This week, the Flexport OTI is showing minor fluctuations, with small drops from China to Northern Europe and China to the U.S. East Coast. Meanwhile, the OTI remains stable for China to the U.S. West Coast.

Week to December 2, 2024

This week, the Ocean Timeliness Indicator (OTI) has remained stable for China to the U.S. West Coast at 35.5 days. Meanwhile, China to Northern Europe came down by half a day, falling from 71 to 70.5 days, and China to the U.S. East Coast by one day, moving from 63.5 to 62.5 days.

 

Source from Flexport.com

Trends to Watch

Happy Thanksgiving!

We want to take a moment to express our gratitude for your continued trust and support. In a world where change is constant, the supply chain sector is no exception — from shifting trade policies to volatile freight markets and labor disputes. We’re here to help you navigate these complexities with one simple mission: making global trade easy for everyone. Without further ado, let’s dive into today’s edition.

[Tariff Watch]

• On Monday, November 25, President-elect Donald Trump announced via Truth Social that he plans to impose sweeping tariffs immediately upon taking office. On Day 1, Trump intends to implement a 25% tariff on all products from Mexico and Canada, alongside a 10% tariff on products from China.
• Trump stated that the tariffs are part of his strategy to address the flow of drugs—particularly fentanyl—and illegal immigration across the U.S. border. “Both Mexico and Canada have the absolute right and power to easily solve this long-simmering problem,” he said. “It’s time for them to pay a very big price.” In a separate post, he also accused China of smuggling fentanyl into the U.S.
• These proposed tariffs could conflict with the U.S.-Mexico-Canada Agreement (USMCA), a trade pact Trump himself signed into law in 2020, which largely promotes duty-free trade among the three nations.
• Want to know what these tariffs could mean for your business and how to stay ahead? Read our live blog for the latest updates, insights, and actionable strategies.

[Ocean – TPEB]

• Floating rates: Rates remain manageable on the West Coast, with space availability open, particularly in the Pacific Southwest and Pacific Northwest. Meanwhile, East and Gulf Coast rates are steady, supported by full-service strings through mid-December.
• Carrier focus: Carriers are preparing for a potential General Rate Increase (GRI) on East Coast routes effective December 1, pending final confirmation. West Coast rates are being extended without immediate adjustments.
• Peak Season Surcharge (PSS): Initial reductions in PSSs are being applied to West Coast routes beginning December 1st, while no changes are planned for East or Gulf Coast routes at this stage.

[Ocean – FEWB]

• Demand fluctuations: Demand picked up slightly in the second half of November, driven by anticipation surrounding the upcoming December GRI. A stabilization is expected in the second half of December due to the holiday season in Europe.
• December GRI: Carriers announced a December GRI at $6,000–$6,200 per TEU, with proactive adjustments based on vessel projections. Some reductions are expected.
• Shanghai Containerized Freight Index (SCFI) movements: The SCFI dropped slightly by $31/TEU in Week 48, reflecting FAK extensions for the second half of November. With the December GRI in effect, the SCFI is expected to rebound in Weeks 49 and 50.
• Equipment availability: Occasional equipment shortages have been reported at China’s main ports, but remain manageable. Premium options are available for those requiring firm space on earlier estimated times of departure (ETDs) or specific service/transit times.

[Ocean – TAWB]

• Demand levels: Demand remains strong for both North and South Europe, with heightened activity in the West Mediterranean. Clients aiming for ETAs before January 15 are prioritizing earlier sailings.
• Blank sailing impact: The blank sailing program for Weeks 47–52 is creating a backlog, as it cannot fully accommodate the increased demand for earlier sailings.
• Equipment availability: Equipment levels are generally good, with some exceptions in hinterland areas where equipment is primarily released on carrier haulage.
• Rate stability: December rates remain stable across most carriers, continuing the trends observed in November for both North and South Europe.

[Air – Global] Mon 11 Nov – Sun 17 Nov 2024 (Week 46):

• Europe to Americas rate surge: Spot rates surged +57% to Brazil and +36% to South America in two weeks, driven by severe congestion and a temporary cargo embargo at São Paulo’s GRU. Transatlantic rates to the USA climbed +33% over two weeks, fueled by reduced capacity from winter schedules and Thanksgiving demand.
• Global spot rate trends: Worldwide spot rates increased +4% WoW and are +25% higher YoY, reflecting strong demand and constrained capacity in key regions. Rates from the Middle East & South Asia remain elevated (+73% YoY).
• Asia-Pacific stability: Rates from the Asia-Pacific to Europe rose +11% (China), while USA routes dipped -4% WoW. Advance planning has tempered peak season volatility, preventing a significant capacity crunch.
• Europe origins: Rates from Europe rose +10% WoW to $2.71 per kilo, now +23% higher YoY, bolstered by high load factors and seasonal demand.
• Market drivers: Rate increases are driven by reduced airline capacity, holiday-related demand surges, and operational disruptions like congestion at major hubs. Effective capacity planning in Asia is mitigating sharper rate hikes globally.

Source: worldacd.com

Please reach out to your account representative for details on any impacts to your shipments.

North America Vessel Dwell Times

 

This Week in News

Trump Pledges Tariffs on Mexico, Canada and China

President-elect Donald Trump has pledged to impose steep tariffs on Mexico, Canada, and China, signaling his intent to follow through on his campaign rhetoric. He announced a 25% tariff on all imports from Mexico and Canada, and a 10% tariff on Chinese goods, citing concerns about drug trafficking, illegal immigration, and fentanyl production. These measures could disrupt the USMCA trade agreement, which facilitated $1.8 trillion in trade in 2022, and raise consumer prices.

Port of Los Angeles Sees Sustained Import Surge Ahead of Tariffs

The Port of Los Angeles processed 905,000 containers in October, a 25% increase from last year, as businesses rush to import goods ahead of potential tariff hikes and labor disruptions at other ports. The Port of Long Beach also saw near-record volumes, with the two ports handling a combined 950,303 import containers. This surge, part of an extended peak season, is expected to continue through the year due to strong consumer demand and concerns over tariffs and labor issues. The Port of Los Angeles is on track to reach 10 million TEUs by the end of 2024.

Tightening Europe decarbonization measures will raise shipper costs: carriers

Carriers are warning that Emissions Trading System (ETS) surcharges will rise significantly in 2025 as the European Union expands its carbon tax to cover 70% of carrier emissions, up from 40% in 2024. This increase in ETS costs will be compounded by the new FuelEU Maritime regulation, which requires carriers to use more expensive low-emission fuels starting January 1, 2025. The ETS, which operates under a “cap-and-trade” system, will require carriers to purchase EU allowances for CO2 emissions from journeys starting or ending in the EU. By 2026, carriers will be responsible for 100% of emissions from these voyages.

Flexport Ocean Timeliness Indicator

__This week, the Flexport OTI is showing a drop from China to the U.S. West Coast, while China to Northern Europe and China to the U.S. East Coast continues their gradual ascent. __

Week to November 25, 2024

This week, the Ocean Timeliness Indicator (OTI) has dropped for China to the U.S. West Coast, falling from 38 to 35.5 days. Meanwhile, China to Northern Europe and China to the U.S. East Coast have each added 0.5 days to their OTI, moving from 70.5 to 71 days and 63 to 63.5 days, respectively.

 

 

Please direct questions about the Flexport OTI to press@flexport.com.

See the full report and read about our methodology here.

The contents of this report are made available for informational purposes only. Flexport does not guarantee, represent, or warrant any of the contents of this report because they are based on our current beliefs, expectations, and assumptions, about which there can be no assurance due to various anticipated and unanticipated events that may occur. Neither Flexport nor its advisors or affiliates shall be liable for any losses that arise in any way due to the reliance on the contents contained in this report.

 

Source from Flexport.com

Trends to Watch

[Ocean – TPEB]

• Space tightness: Space availability on the West Coast, particularly in the Pacific Southwest, has improved due to additional loader capacity expected by the end of November. However, East and Gulf Coast rates remain stable as most service strings stay fully utilized through November.
• Rate trends: Floating rates on the West Coast remain manageable, while East Coast rates are holding steady. Carriers are beginning to focus on the upcoming General Rate Increase (GRI) for East Coast routes, with rates expected to adjust around December 1, pending final confirmation.
• Negotiation pressures: ILA negotiations and potential tariff actions remain the key sources of pressure on rates and capacity.
• Fixed rates and Peak Season Surcharges (PSSs): Fixed rates and PSSs are stable for the remainder of November.

[Ocean – FEWB]

• Space tightness: Space remains constrained in the second half of November due to blank sailings and a growing roll pool. Carriers have announced another GRI for December, with rates projected at $6,000–$6,200.
• Shanghai Containerized Freight Index (SCFI) trends: The SCFI dropped slightly by $29/TEU in Week 47, reflecting the extended FAK rates for 2H November. Another slight decline is expected before an increase aligned with December’s GRI.
• Equipment availability: While occasional equipment shortages persist at China’s main ports, the situation remains manageable. For shippers who need firm space on earlier estimated times of departure (ETDs) or specific service/transit times, premium options are available.

[Ocean – TAWB]

• Space constraints: Space remains tight in November and December across most carriers for both North and South Europe. New York remains the port in highest demand.
• Blank sailings: Planned blank sailings are expected in Weeks 47–52, primarily targeting the US Gulf and the US East Coast (USEC), with departures from both North Europe and the East Mediterranean.
• Equipment availability: Overall equipment availability looks good, with some shortages reported in Southern Germany.
• Rate trends: December rates are tracking in line with November trends.

[Air – Global]

• Capacity: Global air cargo capacity remained stable compared to the previous week, with no significant changes reported.
• Chargeable weight/tonnage: Worldwide chargeable weight flown in Week 45 was stable week-on-week (WoW), with small increases from Europe, Africa, and Central and South America (CSA) origins offset by decreases from North America and Middle East and South Asia (MESA) (both -4% WoW). Compared to last year, worldwide tonnages were up year-on-year (YoY) by just +2% in Week 45.
• Rates: Average global spot rates recorded a further +5% WoW rise in Week 45, taking them +24% above their levels at this time last year. Spot prices from the Asia-Pacific rose by +6% WoW to US$4.43 per kilo, Europe also exhibited a +6% WoW increase to $2.49 per kilo, and CSA rates rose by +10% to $2.04 per kilo. North America recorded a +5% increase to $1.83 per kilo, while Africa and MESA saw WoW falls of -4% and -2%, respectively.
• Year-on-year rate changes: Compared to the equivalent week last year, spot prices this year remain significantly elevated, notably from the Asia-Pacific (+25%), MESA (+70%), Europe (+14%), and CSA (+14%), with Africa also +10% higher and North America recording a +5% increase YoY.

Source: worldacd.com

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North America Vessel Dwell Times

 

 

 

This Week in News

American Companies Are Stocking Up to Get Ahead of Trump’s China Tariffs

Businesses are preparing for potential sweeping tariffs on Chinese goods under Donald Trump’s proposed trade policies, with some rushing to stockpile inventory and others seeking long-term alternatives to Chinese suppliers. This mirrors the response to the 2018 U.S.-China trade war, when companies front-loaded imports, leading to a temporary surge in Chinese exports. Despite some efforts to diversify supply chains to countries like Vietnam and Cambodia, China’s established infrastructure and competitive pricing remain unmatched, making full replacement challenging.

NVOs eager to get past carriers’ tight grip on unexpectedly favorable market

In 2024, ocean carriers tightened control over NVO contracts, demanding more spot cargo/freight-all-kinds (FAK) and closely monitoring compliance with named account contracts (NAC). This forced NVOs to secure more FAK cargo and adhere strictly to NAC terms. Looking ahead, increased vessel capacity in 2025 could ease pressure on NVOs as carriers compete to fill space. However, carriers are expected to maintain strict monitoring of contract compliance, leveraging technology to enforce terms regardless of market shifts.

How shippers can navigate West Coast rail congestion

A surge in container volumes on the U.S. West Coast, driven by peak season, strike mitigation efforts, and tariff concerns, is straining rail operations. Dwell times at the Port of Los Angeles have reached eight days, while Long Beach remains more fluid at four days. Rail operators like BNSF and Union Pacific are addressing congestion through staging yards and capacity expansion, but disruptions persist. Shippers are turning to costly alternatives like cross-docking, air freight, and trucking to bypass delays. Diversions to ports in Mexico, Canada, and the U.S. East Coast are also on the rise. Experts predict rail congestion may ease by Q1 2025, barring additional disruptions such as labor disputes.

Flexport Ocean Timeliness Indicator

This week, the Flexport OTI has decreased from China to the U.S. West Coast and China to Northern Europe, and remained stable from China to the U.S. East Coast.

Week to November 18, 2024

This week, the Ocean Timeliness Indicator (OTI) has decreased from China to the U.S. West Coast and from China to Northern Europe, moving from 40 to 38 days and 71 to 70.5 days, respectively. Meanwhile, the OTI from China to the U.S. East Coast has plateaued at 63 days.

 

Source from Flexport.com

Trends to Watch

[Labor Disputes Update]

• Canadian ports in Montreal and Vancouver are set to reopen after Canadian Labour Minister Steven MacKinnon took decisive action to end lockouts on November 12.
• Meanwhile, the British Columbia port workers union announced plans to challenge both the Canada Industrial Relations Board’s order to end the job action and the Minister’s forced arbitration. Read our blog to learn more.
• In the U.S., the ILA announced on Wednesday (November 13) that it broke off talks with USMX after Tuesday’s negotiations in New Jersey stalled over proposals concerning automation and semi-automation at ports. The two sides had aimed to reach an agreement on a new six-year master contract. Read more here.

[Ocean – TPEB]

• Volumes from Asia have remained strong through the first two weeks of November, driven partly by anticipated tariff increases and the potential ILA strike expected in early January, along with the early Lunar New Year in 2025. Rates continue to vary across routes between China and Southeast Asia, though we’re seeing increased pressure on routes to the U.S. West Coast.
• East Coast volumes are normalizing, but certain carriers and service routes are already fully booked or facing capacity constraints through November.
• Fixed rates and Peak Season Surcharges (PSS) have been steady in the first half of the month, though some PSS adjustments may occur given the highly volatile short-term market.

[Ocean – FEWB]

• Space will remain tight in the second half of November due to ongoing blank sailings and a continuously growing roll pool. With bookings being deferred to avoid arrivals during the Christmas and New Year holidays in Europe, the November GRI may not materialize, and carriers are instead preparing for a December GRI, projected at $3,900/$6,000/$6,000.
• In tandem with the anticipated rate increase, the SCFI rose by $100/TEU to $2,541/TEU for week 46. Another slight increase is expected in the coming week, with rates likely stabilizing or decreasing based on December GRI developments.
• Equipment shortages are occurring sporadically at major ports in China but remain manageable. For those needing firm space with earlier estimated times of departure (ETDs) or specific service and transit times, premium options are available.

[Ocean – TAWB]

• In Northern Europe, demand remains stable and strong. Most services to New York are fully booked, while there is more available capacity in the main Southeast ports. Rates have held steady through the second half of November.
• In the Western Mediterranean, carriers are overbooked, with utilization exceeding 100%. Most carriers successfully implemented rate increases in November and are now assessing the market for December adjustments.
• In the Eastern Mediterranean, capacity is tight due to high demand in recent months. However, the market remains highly competitive, with carriers reviewing rate increases to ensure alignment with market conditions.

[Air – Global] _Mon 28 Oct – Sun 03 Nov 2024 (Week 44)___:

• Global rate rise: In week 44 (28 Oct – 3 Nov), worldwide air cargo rates increased by +2% WoW to $2.71 per kilo, up +12% YoY. Asia-Pacific and Europe rates rose +2% WoW to $3.56 and $2.13 per kilo, respectively, with Africa rates up +3% to $1.98 per kilo. Rates in North America, CSA, and MESA stayed stable.
• Regional rate jumps: Spot rates from China to Europe increased +12% WoW to $4.68 per kilo, and Japan to Europe by +8% to $4.58 per kilo (+26% and +42% YoY). China to the USA reached $5.90 per kilo (+3% WoW), and MESA to Europe rose +4% to $3.29 per kilo—nearly double YoY.
• Capacity cuts drive rates: A -6% WoW capacity reduction from Europe raised load factors and westbound transatlantic rates, responding to reduced bellyhold capacity. Last year’s rates didn’t see this spike.
• Tonnage dips despite YoY growth: Week 44 tonnages were down WoW due to holidays, though up +5% YoY, with significant growth from the Asia-Pacific (+6%), North America (+6%), and MESA/CSA regions (+8%).

Source: worldacd.com

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North America Vessel Dwell Times

 

 

This Week in News

Flexport CEO Ryan Petersen Discusses Possible Tariffs Impact on Global Trade

Flexport CEO Ryan Petersen appeared on Bloomberg Surveillance to discuss the potential impact of President-Elect Trump’s win, including possible new tariffs, ongoing ILA-USMX negotiations, a potential port strike, global manufacturing shifts, and other key issues. Petersen commented, “We’ve seen this movie before,” as Trump reiterated his plan to raise tariffs in his next term.

U.S. retailers ramping up year-end imports ahead of strike, tariff threats

To prepare for a potential East and Gulf Coast dockworkers’ strike in January and high tariffs from President-Elect Trump, U.S. retailers plan to import 350,000 more TEUs than expected in November and December. Revised projections from the Global Port Tracker show November imports up 13.6% year-over-year, with December up 6.1%. Concerns over supply chain disruptions are prompting retailers to frontload merchandise before January.

The U.S. Air Force Strategy That Flexport Uses to Move Billions in Merchandise

When Ryan Petersen launched Flexport in 2013, he approached the problem from a customer’s perspective. Early in his career, he had worked at his brother’s import-export business, sourcing and selling ATVs, scooters, and dirt bikes from Asia to markets around the world. Today, Flexport’s technology moved over $32 billion’s worth of merchandise. Listen to the story here.

Flexport Ocean Timeliness Indicator

This week, the Flexport OTI has increased from China to the U.S. West Coast and China to Northern Europe, and decreased from China to the U.S. East Coast.

Week to November 11, 2024

This week, the Ocean Timeliness Indicator (OTI) has increased from China to the U.S. West Coast and from China to Northern Europe, moving from 38.5 to 40 days and 68.5 to 71 days, respectively. Meanwhile, the OTI decreased from China to the U.S. East Coast, falling from 64.5 to 63 days.

 

Trends to Watch

This week’s global logistics market update starts with a new era for America — As President-elect Donald Trump prepares to impose new tariffs on imports, learn what to expect under the new U.S. administration in 2025, what’s at stake for U.S. trade policies, and our advice for Flexport customers in our latest blog.

[Canada Operations]

• Labor disputes have halted operations at major Canadian ports, including those in British Columbia and the Port of Montreal.
• On November 4, the BC Maritime Employers Association (BCMEA) locked out over 700 members of the International Longshore and Warehouse Union (ILWU) Local 514.
• Meanwhile, nearly 1,200 dockworkers at the Port of Montreal, represented by CUPE Local 375, went on strike on October 31.
• Most cargo will not be diverted to the Canadian East Coast as Montreal terminals are also facing strike action impacting 40% of inbound volumes. We may see vessels shift around their port of destination string stops to prioritize U.S. West Coast ports first to try and wait out the BC lockout.
• Read our blog for the latest developments, and to learn more about the impact on various modes of transport across North America.

[Ocean – TPEB]

• Demand volume remains elevated post-Golden-Week and has now stabilized at a higher level.
• The East Coast continues to experience tighter space availability compared to the West Coast, with rates from China-based ports to the West Coast showing a decrease, while East Coast rates remain steady.
• Fixed rates and Peak Season Surcharges (PSS) remain unchanged as we move into the first half of November.

[Ocean – FEWB]

• The first half of November sees tight space availability due to blank sailings and roll pools carried over from late October. Void sailings will continue into the second half of November, with carriers planning a General Rate Increase (GRI) of $5,400-$5,500 per FEU for this period.
• Some shipments are being postponed to avoid arrivals during the Christmas and New Year holidays in Europe. Should it persist, this trend could significantly impact the GRI and market dynamics in the latter half of November.
• The Shanghai Containerized Freight Index (SCFI) rose by $215/TEU for week 45, reaching $2,442/TEU. Another increase is anticipated for week 46, reflecting the GRI for early November.
• While major Chinese ports have reported occasional equipment shortages, the situation remains manageable. For those requiring firm space with an earlier estimated time of departure (ETD) or specific service and transit times, premium options are still available.

[Ocean – TAWB]

• Demand in Northern Europe remains stable, with good utilization levels. However, some carriers are still seeking cargo for specific destinations. New York continues to be the top port in demand, with most carriers having overbooked vessels heading to this port.
• In the East Mediterranean, demand is stabilizing. Some carriers who implemented rate increases for November have either reduced or canceled them to align with market trends.
• In the West Mediterranean, demand is on the rise, with vessels fully utilized. Carriers have applied increases to floating rates for November.

[Air – Global] Mon Oct. 21 – Sun Oct. 27, 2024 (Week 43):

• Spot rate growth: Global air cargo spot rates experienced a +5% increase week-on-week (WoW) during the final week of October (week 43), driven by significant gains from key regions: Asia-Pacific (+3%), Europe (+7%), and Central and South America (CSA, +8%). The worldwide average spot rate reached US$2.93 per kilo, reflecting a +22% rise compared to last year. Combined spot and contract rates also climbed by +2% to US$2.67. Notable year-on-year (YoY) growth in spot rates included a +27% jump from the Asia-Pacific and a substantial +78% increase from the Middle East and South Asia (MESA), signaling strong demand and limited capacity in these markets.
• Tonnage patterns: Global air cargo tonnages remained relatively flat WoW, but were +4% higher than the same period last year, showing steady recovery after disruptions from China’s Golden Week. Preliminary October data shows a +7% YoY increase in tonnages. Though this is a solid rise, it falls short of the double-digit growth seen earlier in the year, partly due to a strong October 2023, which was driven by a surge in ecommerce.
• Regional market dynamics: Performance in the Asia-Pacific was mixed. While tonnages from the Asia-Pacific to Europe saw a slight +1% WoW rise in week 43, chargeable weight from China to Europe declined by -4% WoW, returning to levels seen in the same period last year. In contrast, Hong Kong to Europe tonnages were +29% higher YoY, despite a small -1% dip WoW. Taiwan (+32%) and Thailand (+30%) also posted strong growth in tonnages to Europe, reflecting robust demand across the region. Spot rates from Hong Kong to Europe rose to US$5.33 per kilo in week 43—their highest level this year, up +18% YoY, indicating sustained demand.
• Transpacific market trends: The transpacific market (Asia-Pacific to the USA) rebounded to pre-Golden-Week levels in week 43, except for China to USA routes, which remained weak. Tonnages from China to the USA were -20% below pre-Golden-Week levels and -19% lower than last year’s equivalent week, indicating softer demand from China. However, spot rates in the region increased significantly, with Asia-Pacific to USA rates averaging US$6.14 per kilo in week 43, up +39% YoY. China to USA spot rates also rose to US$5.13 per kilo, a +14% YoY increase, showing strong pricing despite lower volumes.

Source: worldacd.com

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North America Vessel Dwell Times

 

 

This Week in News

Trade Sector Eyes a New Wave of Tariffs Under Trump

Under a second Trump administration, new tariffs could reshape global supply chains and accelerate shifts away from China. Trump has proposed tariffs of 10-20% on all imports and 60% on Chinese goods, potentially raising prices for U.S. consumers. Flexport CEO Ryan Petersen noted that in the past, businesses have stockpiled goods ahead of tariffs, driving up shipping rates. While many companies are moving production to countries like Vietnam and Mexico, Petersen emphasized that China’s manufacturing capabilities remain hard to replicate, making it likely that many will continue sourcing from there despite tariffs.

Carriers revamp services amid port congestion in Mexico, Central America

Ocean carriers are experiencing major delays at ports in Mexico and Central America due to high trade volumes and congestion. In response, CMA CGM and Maersk are adjusting service routes and implementing surcharges to maintain reliability. Key ports like Acajutla, Corinto, and Manzanillo face severe delays, prompting carriers to reshuffle operations and revise transit times. Other carriers, including Hapag-Lloyd and ONE, also report disruptions, with reduced productivity and extended wait times impacting schedules.

U.S. Chip Toolmakers Move to Cut China From Supply Chains

The U.S. semiconductor industry is cutting ties with Chinese suppliers due to government directives aimed at limiting China’s role in critical technology. Major chip toolmakers like Applied Materials and Lam Research are urging vendors to find non-Chinese alternatives, which could raise costs. This move aligns with broader efforts by the U.S., Japan, and Europe to reduce dependency on China, while China is pushing out U.S. technology in response.

Flexport Ocean Timeliness Indicator

This week, the Flexport OTI has shown increases across all trade routes.

Week to November 4, 2024

This week, the Ocean Timeliness Indicator (OTI) has shown increases across the board: by one day for China to the U.S. West Coast, rising from 37.5 to 38.5 days, and by two days for China to North Europe and China to the U.S. East Coast, shooting up from 67 to 69 days and 62.5 to 64.5 days, respectively.

 

See the full report and read about our methodology here.

The contents of this report are made available for informational purposes only. Flexport does not guarantee, represent, or warrant any of the contents of this report because they are based on our current beliefs, expectations, and assumptions, about which there can be no assurance due to various anticipated and unanticipated events that may occur. Neither Flexport nor its advisors or affiliates shall be liable for any losses that arise in any way due to the reliance on the contents contained in this report.

 

Source from Flexport.com

Trends to Watch

[Ocean – TPEB]

• November is seeing a significant recovery in volumes following the post-Golden-Week lull. This is driven in part by a push from China due to anticipated tariff increases. Rates remain dispersed across routes between China and Southeast Asia.
• East Coast volumes are returning to normal levels, with some carriers and service routes already fully booked or experiencing capacity constraints through November.
• Fixed rates and Peak Season Surcharges (PSSs) are holding steady as we move into the first half of the month.

[Ocean – FEWB]

• Bookings are being pushed to avoid increased freight costs for later November departures, with vessels projected to be full and the roll pool prepared for overflow starting at the end of October.
• A 15-18% capacity cut is expected in November, with ten void sailings announced so far, which will continue impacting market supply.
• The first half of November GRI may settle around $4,400-4,500 per FEU, with carriers planning for a second-half November GRI at approximately $5,400 per FEU.
• The Shanghai Containerized Freight Index (SCFI) rose by $277 per TEU in week 44, and another increase is anticipated in week 45 to reflect GRI adjustments. With space growing increasingly limited, carriers will reintroduce premium services starting November 1 at $2,000 per container for shippers requiring confirmed space on earlier estimated times of departure (ETDs) or specific service transit times.

[Ocean – TAWB]

• Demand in North Europe remains steady, with the typical seasonal peak ahead of the Christmas holidays. Carrier utilization levels are strong, keeping rate levels stable across most services. Some carriers are re-evaluating the Peak Season Surcharge (PSS) applied in October due to the ILA strike.
• In the East Mediterranean, demand is also stable. Utilization is high on certain services, although some loops still face blank sailings due to service reliability issues.
• In the West Mediterranean, demand has increased, and with blank sailings contributing to full utilization, carriers have announced further rate increases for November, continuing the trend from September and October.

[Air – Global] Mon Oct. 14 – Sun Oct. 20, 2024 (Week 42):

• Hong Kong to Europe tonnages: Tonnages increased +25% YoY and +12% since September averages, with spot rates stabilizing above $5 per kilo, reflecting a +13% YoY increase.
• Asia-Pacific to Europe rates and tonnages: Tonnages from Thailand and Vietnam to Europe rose by +27% and +26% YoY, respectively. Spot rates jumped significantly, with Thailand up +87% YoY and Vietnam up +61% YoY.
• MESA to Europe decline: Tonnages from MESA to Europe dropped -8% 2Wo2W, and Dubai to Europe tonnages fell -22% WoW, influenced by geopolitical tensions. Rates to the USA fell from $5.02 to $4.69 per kilo, but are still up +80% YoY.
• China to USA decline: Despite a +4% WoW recovery in total Asia-Pacific-USA tonnages, China-USA tonnages remained down -18% YoY, partly due to tighter U.S. Customs checks. However, spot rates rose +3% WoW to $5.41 per kilo—up +10% YoY.

Source: worldacd.com

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North America Vessel Dwell Times

 

 

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North America Freight Market Update Live

Thursday, November 14 @ 9:00 am PT / 12:00 pm ET

This Week in News

Montreal dockworkers target MSC’s terminals for strike this week

A work stoppage at Montreal’s Maisonneuve and Viau marine terminals, both operated by Termont International, will commence Thursday, following a vote by Local 375 of the Canadian Union of Public Employees (CUPE) to authorize an indefinite strike. This action targets nearly half of the port’s container capacity, impacting over 1 million TEUs of Montreal’s 2.3 million TEUs in capacity. Termont urged shippers to retrieve cargo by Wednesday evening. The strike affects Mediterranean Shipping Co. (MSC) trans-Atlantic and north-south routes, including services from Italy, Mexico, and U.S. Gulf ports, with at least four MSC vessels scheduled to arrive at the impacted terminals.

Houthis Resume Attacks on Ships in Red Sea

Houthi rebels launched an attack on a Liberian-flagged container vessel, the Montaro, in the Red Sea on October 28, marking their first assault on shipping since a U.S. air strike on their bunkers earlier in October. Multiple explosions were reported near the ship as it traveled through the Red Sea Gulf of Aden strait, although no damage or injuries occurred. Houthis also claimed attacks on two other Liberian-flagged vessels in the Arabian Sea the same day, though these remain unverified. Based in Yemen, Houthi rebels have reportedly conducted nearly 100 maritime attacks in the region over the past year, resulting in two sunken ships and four crew fatalities.

Air freight demand largely unfazed by ILA port strike

The recent three-day strike by the International Longshoremen’s Association (ILA) at U.S. ports had a limited impact on air freight demand, as many companies had already taken steps to mitigate potential disruptions. However, experts warn that if a master contract agreement is not reached by January 15, 2025, a second potential strike could cause more significant disruptions to supply chains. They advise companies to monitor port backlogs, prepare alternate logistics options, and communicate with suppliers to manage potential disruptions and cost increases.

Flexport Ocean Timeliness Indicator

This week, OTIs from China to both the U.S. East and West Coasts have increased, while China to North Europe has decreased.

Week to October 28, 2024

This week, the Ocean Timeliness Indicator (OTI) has shown a small uptick for China to the U.S. West Coast, rising from 37 to 37.5 days—a return to the previous week’s figure. Meanwhile, China to North Europe fell further from 68 to 67 days, and China to the U.S. East Coast jumped from 59 to 62.5 days.

 

 

Source from Flexport.com

Trends to Watch

[Customs]

• The Canada Border Services Agency (CBSA) Assessment and Revenue Management (CARM) project, a digital platform to assess and pay duties and taxes on imported commercial goods, went live on Monday (October 21).

[Ocean – TPEB]

• Due to robust demand following Golden Week, carriers have announced a general rate increase (GRI) for Freight All Kinds (FAK) effective November 1, along with adjustments for the first half of the month.
• Floating rates have stabilized and are no longer trending downward for the second half of October.
• Demand returned sharply following Golden Week.
• Fixed rates and Peak Season Surcharges (PSSs) remain unchanged heading into the first half of November.

[Ocean – FEWB]

• Space is filling up in the second half of October due to the upcoming November general rate increase, coupled with capacity cuts from October blank sailings. As a result, bookings are being expedited to avoid higher freight costs for later departures.
• Ten services have blanked for November, resulting in a 15-18% reduction in capacity.
• The Shanghai Containerized Freight Index (SCFI) dropped $90 per TEU for week 43, reflecting the rates for the second half of October, but an increase is anticipated for weeks 44 and 45 once the GRI is successfully implemented and maintained.
• As space becomes limited, carriers will reintroduce premium services starting November 1, priced at $2,000 per container, for those requiring guaranteed space with earlier estimated times of departure (ETDs) or specific service and transit times.

[Ocean – TAWB]

• Demand in Northern Europe is stabilizing, as the backlog from the ILA strike has diminished. New York remains the only port experiencing high demand. Space is currently available, and carriers are extending their rate levels for November.
• In the West East Mediterranean, demand is increasing. Coupled with blank sailings in the region, carriers are achieving full vessel utilization, prompting GRIs and PSSs for November.
• In terms of equipment, there are no significant challenges in Northern and Southern Europe, except for certain areas in Central Europe and Southern Germany.

[Ocean – U.S. Exports]

• Volume surges for containerized rail movements through Los Angeles/Long Beach (LA/LB) in both directions are causing rail-dwell-related congestion at LA/LB rail operations, impacting U.S. export cargo scheduled to move from inland points via LA/LB.
• Currently, there are restrictions on the number of containers moving westbound from inland rail points to LA/LB. These restrictions are expected to last 7-10 days to allow the network to recover and return to regular performance levels.
• Customers exporting from the U.S. via LA/LB may experience longer transit times and delays.

[Air – Global] Mon Oct. 7 – Sun Oct. 13, 2024 (Week 41):

• China-USA Tonnages: In week 41, tonnages from China to the USA increased by just +1% week-on-week (WoW) after dropping -20% in week 40. Year-on-year (YoY), China-USA tonnages were down by -19%, marking the biggest YoY percentage drop this year, primarily driven by increased customs checks at LAX and Golden Week impacts.
• Worldwide & Asia Pacific Recovery: Global air cargo tonnages rose +2% WoW in week 41, placing them +8% above last year’s levels. Asia Pacific region recovered more strongly, rising +6% WoW after a -10% drop in week 40, bringing tonnages +12% higher than the same time last year.
• China-LAX Effect: China-LAX tonnages were down -39% YoY in week 41 due to both Golden Week and increased customs checks since July. When looking at September as a whole, China-LAX tonnages were down -19% YoY, while overall China-USA tonnages fell -8% YoY.
• Pricing Trends: Average worldwide rates remained stable at $2.58 per kilo, +12% YoY. Spot rates from China to the USA rose +8% WoW to $5.28 per kilo, rebounding from a previous -7% drop. Asia Pacific to USA spot rates increased +3% WoW to $6.11 per kilo, up +45% YoY.

Source: worldacd.com

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North America Vessel Dwell Times

 

 

 

This Week in News

Stability in Freight Markets Is Reviving Logistics Dealmaking — The Wall Street Journal

Mergers and acquisitions in the logistics sector are rebounding as market volatility from the pandemic subsides. After a two-year slowdown, companies are actively seeking purchases or considering sales, driven by stabilized valuations. Notable deals include DSV’s $12 billion acquisition of DB Schenker, and UPS’s sale of Coyote Logistics for over $1 billion.

Delay in Europe’s deforestation rule does not address key issues: Palm oil industry — Journal of Commerce

The European Union’s decision to delay the Deforestation Regulation (EUDR) by at least 12 months will not alleviate concerns for small farmers, particularly in the Southeast Asian palm oil industry. Experts argue that without amending traceability requirements to exempt smallholders, these farmers will remain barred from European markets. The delay, which pushes the implementation date for large companies from December 31, 2023, to December 30, 2025, and June 30, 2026, for small businesses, does not resolve concerns regarding the regulation’s traceability requirements, particularly for small-scale farmers.

Roaring volume has Port of Los Angeles eyeing $1 trillion in imports — FreightWaves

The Port of Los Angeles is experiencing unprecedented growth, with a record 954,706 TEUs handled in September, contributing to a total of 2.85 million TEUs in the third quarter—up 27% year-over-year. Driven by strong consumer spending and an early start to holiday imports, the port’s import value reached $990 billion for the quarter, with expectations of soon hitting $1 trillion.

Flexport Ocean Timeliness Indicator

OTIs have demonstrated a small decrease across the board, showing signs of stabilization at current levels.

Week to October 21, 2024

This week, the Ocean Timeliness Indicator (OTI) has shown small downward movements across the board. China to the U.S. West Coast went from 37.5 to 37 days, China to North Europe from 69 to 68 days, and China to the U.S. East Coast from 59.5 to 59 days.

 

Please direct questions about the Flexport OTI to press@flexport.com.

 

See the full report and read about our methodology here.

The contents of this report are made available for informational purposes only. Flexport does not guarantee, represent, or warrant any of the contents of this report because they are based on our current beliefs, expectations, and assumptions, about which there can be no assurance due to various anticipated and unanticipated events that may occur. Neither Flexport nor its advisors or affiliates shall be liable for any losses that arise in any way due to the reliance on the contents contained in this report.

 

Source from Flexport.com