Weekly Market Updates

Transport Update 20th December

Dec 21, 2021
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: Covid outbreaks in China causes delays in operations and poses risks for global goods

 


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In focus: Covid outbreaks in China’s Zhejiang province causes factory closures across the region

Lockdowns in China’s Zhejiang province have prompted multiple factory closures and new restrictions have been placed on trucking.

This comes after the province reported 217 locally transmitted Covid cases with confirmed symptoms in just eight days from 6th December. Prior to this, Zhejiang had reported one local case this year. 

Tens of thousands are in quarantine and some domestic flights have been suspended due to an outbreak in three cities: Ningbo, Shaoxing and Hangzhou.

The restrictions have impacted textile firms and their access to Ningbo-Zhoushan Port, since truck drivers are reluctant to enter the area due to quarantine requirements. Furthermore, Ningbo has tightened restrictions on truck drivers entering its container terminals, depending on which areas they have visited previously.

Operations are currently impacted as truck drivers are required to provide nucleic acid negative test certificates, causing delay

 

Ocean

Asia → North America (Transpacific Eastbound)

Rates

  • Container spot rates are edging up again across most trade lanes, with a big spike expected in January ahead of the Chinese New Year holiday.
    • The Drewry’s World Container Index (WCI) saw Asia-US components jump by 5% to the west coast, to $10,138 per 40ft, and by 4% for east coast ports, to $13,118 per 40ft. 
    • The Freightos Baltic Index (FBX), which includes premium fees, inched up 1% to the west coast, to $14,924 per 40ft, while east coast ports recorded an increase of 2.5%, to $17,195.

Capacity

  • The trend in blank sailings in 2021 has shown to be fluctuating through the entire year. 
    • Data from Sea-Intelligence shows that blank sailings between Asian and the North American West Coast ports averaged approximately 12 percent of TEU capacity in 2020 versus blank sailings of an expected average of nearly 20 percent of TEU capacityin 2021.
  • Since week 41, the carriers have consistently been blanking more than 20 percent of TEU capacity on these routes and it is expected to remain constant through the end of the year.
  • This is because of several factors, including the demand boom in North America and port congestion. As a result, carriers are struggling to meet their weekly vessel departure obligations, resulting in vessel delays, rolled schedules and blank sailings.

Ports

  • Over 100 container ships are waiting for a berth at Los Angeles and Long Beach.
    • The typical pre-pandemic fortnight’s passage for ships transiting from Asia to North America is now soaking up enormous capacity with some voyages taking longer than 45 days to berth.
    • Last month, American authorities pushed the vessel parking lot away from the California coast, asking ships to idle some 150 miles from the coastline. As a result, the volume of backed up vessels has continued to grow.
    • The latest data shows that there are 30 ships anchored or loitering inside Southern California waters plus 71 slow-speed-steaming or loitering outside the designated safety and air quality area.
    • However, in preparation for an incoming storm, port authorities have cleared all ships anchored off the ports of Long Beach and LA. 
  • San Pedro ports have postponed their container dwell fee for the fifth week in a row. 
    • Implementation of the dwell fees is now on hold until at least December 20th as the ports continue to monitor cargo flow through terminals.
    • The latest update said the two ports have seen a decline of 47% in cargo on docks since the fee was announced on October 25th.
  • Forward schedules published by MSC show that the shipping line will soon expand the port coverage of some of its Far East – North America services.
    • This change will happen independent of the 2M Alliance.
    • MSC will start serving the US Gulf with its North Vietnam – Central China – US East Coast loop ‘Santana’, adding Houston to this loop. 
    • This will call at Haiphong, Shanghai, Ningbo, Houston, Charleston, New York, Haiphong.
    • MSC will also add calls at Busan and at Portland to the rotation of its ‘Mustang’ service, which so far used to be a pure Shanghai – Los Angeles shuttle.
    • The revised rotation will see calls at Shanghai, Busan, Portland, Los Angeles, Shanghai.
City Soonest Availability Date Important Note! Notice Required (Estimated)
Atlanta 12/22 HAZ 12/30 Export Congestion / limited hazardous availability – chassis shortage 1.5 weeks
Baltimore No current capacity issues, please send your dispatch Chassis shortage
Birmingham 12/28 Export Congestion 2 weeks
Boston No current capacity issues, please send your dispatch
Buffalo No current capacity issues, please send your dispatch
Charleston 1/12 SPOT PRICING MAY APPLY 4 weeks
Charlotte 12/30 Chassis shortage 2 weeks
Chicago 12/30 SPOT PRICING MAY APPLY Export Congestion, chassis shortage 2.5 weeks
Cincinnati 12/20 Chassis shortage 1 week
Cleveland No current capacity issues, please send your dispatch Export Congestion 1 week
Columbus No current capacity issues, please send your dispatch
Dallas No current capacity issues, please send your dispatch
Denver No current capacity issues, please send your dispatch Export Congestion 2 days local / 1.5 weeks for road moves
Detroit No current capacity issues, please send your dispatch Export Congestion 1.5 weeks
El Paso No current capacity issues, please send your dispatch
Houston 1/7 Export Congestion / Limited availability / Chassis + Triaxle shortage 2 weeks local/3 weeks road
Huntsville 12/29 2.5 weeks
Indianapolis No current capacity issues, please send your dispatch Export Congestion 1 week
Jacksonville No current capacity issues, please send your dispatch
Kansas City 12/21 Export Congestion / very limited triaxles / chassis shortage 1 week
Laredo No current capacity issues, please send your dispatch 2 weeks
Los Angeles NOT ACCEPTING NEW ORDERS UNLESS ALREADY ESTABLISHED REOCCURING MOVES Limited reefer & hazardous availability Not accepting new orders
Louisville 12/21 SPOT PRICING MAY APPLY Export Congestion, chassis shortage 2 weeks
Memphis 12/20 Export Congestion – EXTREMELY limited hazardous coverage, chassis shortage 1.5 weeks
Miami 12/30 SPOT PRICING WILL APPLY VERY limited availability out of SFCT, Limited haz availability 3.5 weeks
Minneapolis 12/20 SPOT PRICING MAY APPLY Chassis shortage, Very limited truck availability 1.5 weeks
Mobile 12/30 SPOT PRICING MAY APPLY Equipment shortage and limited avail for moves over 300 miles or OW loads 2.5 weeks
Nashville 12/20 Export Congestion, chassis shortage 1 week
New Orleans 1/6 SPOT PRICING MAY APPLY Very limited on triaxles/overweight, chassis shortage 3.5 weeks
NY/NJ 1/4 Limited haz coverage – after 1/14 3.5 weeks
Norfolk 1/10 SPOT PRICING MAY APPLY Very limited availability for PA moves, chassis shortage 4 weeks
Oakland 12/22 Export Congestion, chassis shortage 1 week
Omaha 12/20 Very limited triaxles 1 week
Philadelphia 12/30 Limited availability for exports, chassis shortage 2.5 weeks
Phoenix No current capacity issues, please send your dispatch
Pittsburgh No current capacity issues, please send your dispatch
Portland 12/30 SPOT PRICING WILL APPLY Chassis shortage, Very limited truck availability 5 weeks
Saint Louis 12/20 Export Congestion – limited availability for triaxles, chassis shortage 1 week
Salt Lake City No current capacity issues, please send your dispatch
San Antonio No current capacity issues, please send your dispatch
Savannah 1/6 SPOT PRICING WILL APPLY Export Congestion / very limited haz and triaxle availability, chassis shortage 3.5 weeks
Seattle/Tacoma 1/10 SPOT PRICING WILL APPLY Very Limited availability for exports and moves out of Tacoma ports, chassis shortage 4 weeks
Tampa 12/22 2 weeks
Wilmington 12/30 2 weeks

 

Asia → Europe (Far East Westbound)

Rates

  • From Asia to North Europe, Drewry’s World Container Index (WCI) was flat, at $13,564 per 40ft 
  • The Freightos Baltic Index (FBX) increased by 1%, to $14,345 per 40ft
  • The Xeneta (XSI-C) Index improved by 3%, to $14,443 per 40ft.
  • Several carriers are now reported to be offering forwarders and NVOCCs Asia-North Europe rates with a validity of just two weeks. These carriers are declining to sign any short-term contracts before CNY in February.

Equipment

  • See below

Ports

  • The 2M shipping alliance has made the temporary decision to consolidate the Asia-North Europe port calls in the New Year. 
  • Maersk and MSC have said that from January, the AE1/Shogun service will omit the call at Felixstowe and the AE55/Griffin loop would no longer call at Rotterdam.
  • This is due to exceptional waiting time and congestion faced in North Europe. By reducing calls, the carriers hope to mitigate potential disruptions across the network.
Carriers POL 20GP 40GP 40HQ
HPL NINGBO Normal Normal Normal
SHANGHAI Normal Normal Shortage
YANTIAN Normal Normal Normal
SHEKOU Normal Normal Normal
MSK QINGDAO Normal Normal Normal
SHANGHAI Normal Normal Normal
NINGBO Normal Normal Normal
Nanjing Normal Normal Shortage
Xiamen Normal Normal Shortage
YANTIAN Normal Normal Normal
SHEKOU Normal Normal Normal
NANSHA Normal Normal Normal
HONGKONG Normal Normal Normal
SHANTOU Normal Normal Normal
ONE YANTIAN Normal Normal Normal
SHEKOU Normal Normal Normal
XINGANG Normal Normal Normal
QINGDAO Normal Normal Normal
SHANGHAI Normal Normal Normal
NINGBO Normal Normal Normal
ZIM XIANGANG Normal Normal Normal
NINGBO Normal Normal Normal
SHANGHAI Normal Normal Normal
YANTIAN Normal Normal Normal
SHEKOU Normal Normal Shortage
HMM SHANGHAI Normal Normal Normal
NINGBO Normal Normal Normal
YANTIAN Normal Normal Normal
SHEKOU Normal Normal Normal
MSC SHANGHAI Normal Normal Normal
NINGBO Normal Normal Normal
YANTIAN Normal Normal Normal
SHEKOU Normal Normal Normal
EMC YANTIAN Normal Normal Shortage
SHEKOU Shortage Shortage Shortage
NINGBO Shortage Shortage Shortage
SHANGHAI Shortage Shortage Shortage
QINGDAO Shortage Normal Normal
OOCL YANTIAN Normal Normal Shortage
SHANGHAI Normal Normal Normal
NINGBO Normal Normal Shortage
CMA QINGDAO Normal Normal Shortage
SHANGHAI Normal Normal Shortage
NINGBO Normal Normal Shortage
YANTIAN Normal Normal Shortage
SHEKOU Normal Normal Shortage
COSCO YANTIAN Normal Normal Normal
SHEKOU Normal Normal Normal
SHANGHAI Normal Normal Normal
NINGBO Normal Normal Normal
QINGDAO Normal Normal Normal
DALIAN Normal Normal Normal
XINGANG Normal Normal Normal
YML YANTIAN Normal Normal Normal
SHEKOU Normal Normal Normal

 

 

Air

Asia 

 Central China to USA and Europe

  • The market has slowed a little for the US and Europe.
  • Due to the run up before Christmas, there is less cargo than before. 
    • Covid restrictions are still in place at PVG Airport.
      • Over 40% of cargo flights are cancelled
      • Terminals are at 50% in terms of labour resources
    • Rates from NGB to USA and Europe have decreased on both lanes. 
  • Bookings should also be made in advance and rates and space need to be checked with your carrier on a case-by-case basis. 

North China to USA and Europe

  • The situation is critical this week from TSN to the USA and Europe. Customers will need to check with their carriers on a case-by-case basis as space is already fully booked on December 28/29th. 
  • Asiana Airlines are not accepting bookings for the US but are accepting them to Europe based on cargo details. 
    • Korean Air is accepting bookings based on cargo details to both destinations. 
    • Dense cargos can apply for spot rates. These will come at a high rate including a longer transit time. 
  • Rates from PEK Airport have decreased compared to last week to the USA and Europe. 
    • Space is getting tight due to the last week before Christmas and Covid testing. 
  • It is advisable to confirm rates and space 3-4 days in advance. 
  • Bookings should also be made in advance and rates and space need to be checked with your carrier on a case-by-case basis.

South China to USA and Europe

  • The air rate has reduced slightly from CAN airport to the USA and Europe. 
  • At SZX Airport, rates for flights to the USA have decreased; however, they have remained stable and high for those to Europe. 
  • Space to the USA and Europe from XMN Airport is tight. Rates have decreased for both destinations. 
  • Bookings should also be made in advance and rates and space need to be checked with your carrier on a case-by-case basis. 

Americas

  • FedEx Express recently completed a major expansion of its air cargo hub located at Miami International Airport.
    • The US $72.2m expansion will increase capacity and capabilities at the company’s Americas gateway, which connects the US and Canada to Latin America and the Caribbean. 
  • United Express has taken an equity stake in hydrogen-electric engine developer ZeroAvia, giving them the ability to purchase ZA2000-RJ engines. 
    • Therefore, 100 zero-emission, 100% hydrogen-electric engines could be used on United Express regional aircraft by 2028. 
    • This will make United the largest airline to invest in zero-emission, hydrogen-electric engines for regional aircraft with belly hold capacity. 

Europe/UK

  • Atran Airlines has added another flight between China and Europe utilising a B737 freighter.
    • The Russian carrier will operate a weekly flight between Shenzhen and Cologne-Bonn using a B737-800BCF. This is an aircraft used for regional and national operations given its 23 tonne capacity and range. 
  • European cargo airline, Cargolux, will deploy IBS Software’s iCargo SaaS solution to improve services and efficiency, which will also streamline customer experience.
    • Cargolux is currently going through a digital transformation and the aim of implementing iCargo is to innovate and implement a system to help coordinate with their partners. 
  • Air Belgium is looking to expand in the air cargo market through the addition of B747-8 freighter aircraft operations.
    • The airline has started its recruitment of cockpit positions for captains and first officers who are qualified to fly. 
    • The airline already operates four freighter aircrafts on behalf of CMA CGM.

Road and Rail

Freight Rates Increase

  • Freight rates have increased by 14.2% in November 2021 compared to November 2020.
  • Freight rates are up 1.4% in November 2021 compared to October 2021.

Capacity Decreases

  • Capacity is down by 20% in November 2021 compared to November 2020.
  • Capacity is down by 1.2% in November 2021 compared to October 2021

REMINDER: Prepare for full customs controls from 1st January 2022

From the 1st January 2022, the current easements on full customs controls of goods moving into the UK will be removed, and customs checks will be introduced. Prior notification of agri-food imports will be required, but how soon before shipment is needed will differ as time limits for this will vary depending on transport route.

The temporary easement for the requirement to hold supplier declarations (where required) prior to issuing statements on origin for export to the EU will also cease for businesses using the EU-UK trade agreement. Suppliers’ declarations will likely be necessary where you purchase goods for onward sale unaltered, or you need evidence of the originating status of production inputs to calculate the origin of your goods.

Freight continues to move between the UK and France

From Friday 17th December 23:00 GMT, passengers will be prohibited from travelling between the UK and France for leisure and professional reasons. Please be assured that HGV drivers are exempt from these changes and freight will continue to move in order to ensure goods reach their destination.

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 24th – Bulgaria, Czechia, Estonia, Latvia, Lithuania, Slovakia

December 25th – Austria, Belgium, Bulgaria, Bosnia & Herzegovina, Belarus, Switzerland, Cyprus, Germany, Denmark, Spain, Estonia, France, Finland, Greece, Hungary, Croatia, Italy, Ireland, Luxembourg, Latvia, Lithuania, Moldova, Malta, Norway, Netherland, Portugal, Poland, Romania, Sweden, Slovakia, Romania, Slovenia, Ukraine

December 26th –  Austria, Bulgaria, Switzerland, Cyprus, Czechia, Germany, Denmark, Estonia, Finland, Greece, Hungary, Croatia, Italy, Ireland, Luxembourg, Latvia, Lithuania, Norway, Netherlands, Poland, Romania, Sweden, Slovakia, Slovenia

December 27th – Great Britain

December 28th – Bulgaria, Great Britain

December 31st – Estonia, Latvia, Russia

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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Kim Wan
Kim Wan

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