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: Do rate freezes mean the worst is behind us?

In focus: Rate freezes

“We believe spot rates have peaked, and we do not pursue further increases – we hope that the market will slowly start to calm down,” says HAPAG-Lloyd in a recent advisory, joining CMA CGM in placing a cap on spot freight rates for containerised cargo.

CMA CGM said in a customer advisory on September 9 that any further increases in spot rates would be halted with immediate effect until February 1. In their words, ” The Group is prioritizing its long-term relationship with customers in the face of an unprecedented situation in the shipping industry.”

While these freezes are being frames as a means to put clients first, the view from most shippers is that this is a prelude to contract negotiations. More importantly, it indicates that carriers are taking the long term view after months of prioritising short term revenues with new services, containers and rate increases.

This is far from a sign that things are about to head back to normal – most experts predict that any ‘new normal’ will be far from the abundant, over-capacity market of earlier this decade. But it could be a sign that rates have reached a peak, though we have also all seen how easily predictions can fall apart in the face of disruption.

Update – Super Typhoon Chanthu

This week we received reports that Super Typhoon Chanthu was heading towards China’s East Coast and that it would cause the cancellation of all flights into and out of Shanghai Pudong.

While flights were cancelled as of 11am yesterday, the typhoon has been downgraded from ‘Super’ to ‘Strong’ and isn’t now expected to land in Shanghai. Flights are expected to resume from 10am on the 14/09 but there will be some backlog as a result of yesterday’s flights cancellations. We would ask that you be prepared for delays in the coming days.


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Ocean

Asia → North America

Rates

  • Rates remain stable this week, with no major increases.
    • We are still seeing ranges of $14,000 to $18,000 to L.A and the US West Coast.
    • $20,000 to $24,000 ranges to the East Coast.
    • $22,000+ to the MidWest of the USA
  • The Indian subcontinent continues to see elevated rates as congestion and equipment shortages remain.

Capacity

  • MSC is to launch two additional weekly shuttle between China and Longbeach in response to a continuous strong Transpacific market.
  • The Port of Long Beach is expected to surpass 9 million TEUs. Improvements are being made to keep the terminal fluid amid operational challenges.

Equipment

  • Chassis remain extremely scarce at key locations, with extended wait times:
    • New York area – three weeks.
    • Los Angeles area – three and a half weeks 
    • Inland locations – three weeks
  • We recommend advanced bookings of four weeks to ensure space.
  • More details below.

Ports

  • Severe congestion in L.A. and Long Beach area with a delay of 8-13 days with over 40 vessels waiting to berth.
  • 142 ships were in port on 14th September, setting a new all-time record, with 16 containerships awaiting in nearby drift areas.
  • East Coast is stable, aside from port closures occurred due to Hurricane Ida.
City Soonest Availability Date Notes Notice Required (Estimated)
ATLANTA 9/22 (chassis shortage) Export Congestion / limited hazardous availability 1 week
BIRMINGHAM 21-Sep Export Congestion 1 week
BOSTON 28-Sep 2 weeks
CHARLESTON 11-Oct 4 weeks
CHARLOTTE 9/20/2021 (chassis shortage) 1.5 weeks
CHICAGO 10/5/2021 (Chassis shortage) Chassis Shortage Export Congestion 3-3.5 weeks
CINCINNATI 9/21 (Chassis Shortage) 1 week
CLEVELAND 9/24 (Chassis Shortage) Export Congestion 1-1.5 weeks
DALLAS 21-Sep Export Congestion 1 week
DENVER Local OPEN Road 9/23 (Chassis Shortage) Export Congestion 2 days local / 2 weeks for road moves
DETROIT Local 9/24 Road 9/28 (Chassis Shortage) Local 1.5 weeks / Road 2 weeks
HOUSTON 9/23 Local 10/4 Road (Chassis and Container Shortage) Export Congestion / Limited availability for DFW area 1.5 weeks local and 2.5 weeks road
HUNTSVILLE 24-Sep 1.5 weeks
INDIANAPOLIS 10/1 (chassis shortage) Export Congestion 2.5 weeks
KANSAS CITY 10/1 (Chassis Shortage) Export Congestion 2.5 weeks
LONG BEACH NON HAZ 10/11/2021 – 10/15 HAZ Limited hazardous availability 4 weeks
LOUISVILLE 9/23(Chassis Shortage) Export Congestion 1.5-2 weeks
MEMPHIS 10/4 (Chassis Shortage) Export Congestion – EXTREMELY limited hazardous coverage 3 weeks
MIAMI 14-Oct VERY limited availability out of SFCT, Limited haz availability 4 weeks
MINNEAPOLIS 9/27 (Chassis shortage) 2 weeks
MOBILE 9/24 LOCAL 10/5 ROAD (Chassis Shortage) EXTREMELY limited availability for moves over 300 miles 1.5 weeks local-3 weeks road
NASHVILLE 9/24 (Chassis shortage) Export Congestion 1.5 weeks
NEW ORLEANS 24-Sep 1.5-2 weeks
NORFOLK 10/4 (Chassis shortage) 3 weeks
NY/NJ 10/5 (Chassis Shortage) Export Congestion 3-3.5 weeks
OMAHA 24-Sep Very limited triaxles 1.5 weeks
PHILADELPHIA 28-Sep 2 weeks
PORTLAND 9/30-very limited truck availability 2-2.5 weeks
SAINT LOUIS 9/30 (chassis shortage) Export Congestion – limited availability for triaxles. 2.5 weeks
SALT LAKE CITY 20-Sep Export Congestion 1 week
SAVANNAH 10/5 (Chassis shortage) Export Congestion 3-3.5 weeks
SEATTLE/ TACOMA 10/8 (chassis shortage)

Asia → Europe (Far East Westbound)

Rates:

  • Rates remain stable for the second half of September. Several carriers including Evergreen, HMM and ONE have extended validity until the end of September, while Yang Ming have extended rates for four weeks until mid October.
  • MSC has increased its standard contract rates by $1000, though there are signs of increased availability.
    • Whereas before there was a $2000 difference between the diamond tier and standard tier, it’s now $1000.
  • The Indian subcontinent is a different picture, with rate increases and Peak Season Surcharges.
    • Hapag Lloyd has announced a PSS between India and Bangladesh of $500/ container.

Capacity

  • 2M Alliance (Maersk and MSC) will implement several blank sailings from Asia to North Europe:
Week Service Voyage Number Port of Loading (POL) Estimated Time of Arrival (ETA) Date
39 AE55 / Griffin QG139W Shanghai 26 September
39 AE6 / Lion FL139W Ningbo 28 September
40 AE6 / Lion FL140W Ningbo 5 October
40 AE5 / Albatross 140W Dalian 2 October
  • Additional blank sailings below:
Alliance EUR BLANK SAILING
Service V/V Nominal Capacity/Teu ETD QINGDAO ETD SHANGHAI ETD NINGBO ETD SHEHZHEN ETD WEEK in SHENZHEN
OA FAL7 / NE7 / AEU7 / LL3 TBA 13,400 / / / 2021/10/13 41
FAL5 / NE1 / AEU1 / LL1 TBA 21,000 / 2021/10/15 2021/10/16 2021/10/21 42
FAL3 / AEU6 / LL5 TBA 17,700 2021/10/15 2021/10/19 2021/10/17 2021/10/22 42
THE FE4 TBA 24,000 2021/10/7 2021/10/16 2021/10/13 2021/10/20 42

Air

Asia

US market

  • A large number of flights have been cancelled due to the typhoon. Backlog is expected to be cleared from Wednesday and into the weekend. This will cause delays for any new shipments being delivered in. 
  • Uplifts are expected to be delayed and transit times will be longer.
  • Rates and space must be checked on a case by case basis.

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

  • A large number of flights have been cancelled due to the typhoon. Backlog is expected to be cleared from Wednesday and into the weekend. This will cause delays for any new shipments being delivered in. 
  • Uplifts are expected to be delayed and transit times will be longer.
  • Rates and space must be checked on a case by case basis.

UK market

  • A large number of flights have been cancelled due to the typhoon. Backlog is expected to be cleared from Wednesday and into the weekend. This will cause delays for any new shipments being delivered in.
  • Uplifts are expected to be delayed and transit times will be longer.
  • Rates and space must be checked on a case by case basis. 

Americas

  • Rates to PVG will increase in the coming weeks as a result of the terminal closure.
  • Rates into UK and Europe remain mostly the same this week.
  • Space remains constricted due to reduced capacity and staff shortages.
  • 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 are not 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

  • Rates from PVG will increase in the coming weeks as a result of the terminal closures.
  • Rates to the US remain the same with no real increase.
  • Capacity to most regions is still restricted.

Road

Availability

Availability generally reliable across all routes and regions.

Rates

Rates remain stable across consolidated, groupage and dedicated trailers on other routes.

Customs

    • From 1 October, there will be new safety and security requirements surrounding exports with an expanded list of movements requiring exit summary declarations (EXS), raising complexity in GB-EU supply chains.
  • From the end of next month, shippers will be required to supply an EXS for further movements, like empties being moved under a transport contract to the EU and goods moving by vessels where there would otherwise be a requirement for an EXS.

UK Haulage

  • Availability of trucks continues to be an issue out of the ports
    • Southampton specifically is proving more difficult to get haulage cover
    • Last minute deliveries are extremely difficult to book
  • It’s essential that customers provide accurate information in advance to avoid costs when changing information last minute.
    • The majority of preferred hauliers do not have capacity until the need of October – the earlier they are booked in the better.
  • Off dock storage a problem at Felixstowe.
  • Rail is also an issue due to partners have declined to take on further business and rail provider is struggling with the shunting at destinations so not an option at the moment

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.

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