Weekly Market Updates

Transport Update 27th December

Dec 27, 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: US transportation and agriculture secretaries send letter to 12 major carriers

 


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In focus: US transportation and agriculture secretaries send letter to 12 major carriers

US Secretary of Transportation, Pete Buttigieg, and Secretary of Agriculture, Tom Vilsack, have sent a letter to 12 of the world’s leading ocean carriers, urging them to help reduce disruptions to agriculture shippers of US exports. They have asked them to help relieve supply chain disruptions created by the pandemic by improving their services. 

The letter was sent to CMA CGM America LLC, COSCO North America, Evergreen Shipping Agency, Hapag-Lloyd AG North America, MSC Mediterranean Shipping Company USA, Maersk Inc., Ocean Network Express, OOCL (USA) Inc., SM Line, Wan Hai Lines America, Yang Ming Marine Transport Company and Zim American Integrated Shipping Service.

Ocean

Asia → North America (Transpacific Eastbound)

Rates

  • Shipping and logistics prices are expected to increase even further in 2022. 
    • According to Cass Information Systems, domestic shipping rates for moving goods by road and rail in the U.S. are up by about 23% this year from 2020.
    • Logistics Managers’ Index that tracks overall logistics prices, including transportation, warehousing and inventory prices, reached a record in November, up by 3.4% from October and a 14% increase year-over-year. 
    • FedEx Corp. and United Parcel Service Inc. both said rates would go up an average of 5.9% next year across most services. This is the first time in eight years that either company had annual increases above 4.9%.
    • Xeneta said the spot price to ship a 40-foot container from Shanghai to Los Angeles earlier this month was 75% higher compared to last year.
  • The Freightos Baltic Index has dropped for both the West and East Coast of the USA.
    • Rates have dropped by 2% on the West Coast to $14,616 per 40ft.
    • On the East Coast, rates have decreased by 1% to $16,680 per 40ft.

Ports

  • Import volumes at the Port of Oakland rose for the first time in two months in November as shipping lines restored services to the port following mid-year cancellations.
    • Containerised imports jumped 6.5% last month compared to November 2020. For the first 11 months of 2021, Oakland imports are up by nearly 8%.
    • The port attributed the recovery to additional ship traffic, with 75 ships calling in Oakland during November – the most in six months. November exports, however, declined over 9%.
    • Shipping lines are restoring vessel service to Oakland following mid-year cancellations, while some cargo owners have even chartered their own ships to call at the port. 
    • Ships bypassed Oakland earlier this year due to excessive delays in Los Angeles and Long Beach, but carriers now view Oakland as an uncongested alternative to gridlocked Southern California gateways.
    • Oakland exports declined 9.4% last month because there weren’t enough ships headed to foreign markets, the port said. 
  • Τhe Ports of Long Beach and Los Angeles have decided to postpone the implementation of “Container Dwell Fee” for the sixth time, until 27 December.
    • While the ports of San Pedro Bay have seen a combined decline of 46% in ageing cargo on the docks since the fee was announced on 25 October. 
    • The two Californian ports plan to charge ocean carriers for import boxes that dwell on marine terminals, US$100 per container, increasing in US$100 increments per container per day, until the container leaves the terminal.

Asia → Europe (Far East Westbound)

Rates

  • FBX rates have remained relatively flat at $14,495 per 40ft from Asia to North Europe. 
  • On the other hand, it has increased by 0.2% to $13, 569 from Asia to the Mediterranean.

Equipment

  • See below

Ports

    • The 2M partners, Maersk and MSC, have decided to further reduce the number of port calls in their Asia – North Europe network from January. Two of their six loops will only serve two selected ports in North Europe.
    • From January, the eleven 14,000 – 23,800 teu ships of the ‘AE55 / Griffin’ service will load in Shanghai, Ningbo, Tanjung Pelepas for Felixstowe and Le Havre.
    • Eleven 13,100—23,800 teu ships of the ’AE1 / Shogun’ will load in Ningbo, Xiamen, Yantian and Tanjung Pelepas for Rotterdam and Bremerhaven only.
    • As from January next year, Shanghai will be served by five 2M loops, six from the OCEAN Alliance and two from THE Alliance, resulting in fifteen weekly calls (from the eighteen loops on the trade).
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 Normal
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 Normal
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 Normal Normal Normal
OOCL YANTIAN Normal Normal Normal
SHANGHAI Normal Normal Normal
NINGBO Normal Normal Normal
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 

  • A new cargo airline in Bangladesh is due to commence operations next year.
    • NXT Air has released a statement to local media confirming it has received a No Objection Certificate (NOC) from the Civil Aviation Authority of Bangladesh (CAAB).
    • The airline’s plans to initially use an ATR 72 to carry cargo. A second ATR 72 and a Boeing 738 are due to be introduced later in the year to enable the airline to operate on international routes.
    • Cargo airlines in Bangladesh include Bismillah Airlines, Easy Fly Express, Hello Airlines and SkyAir.
  • SF Airlines has continued its rapid freighter fleet expansion with an additional B767 aircraft.
    • The China-based express carrier last week added a B767-300 widebody freighter (B-221D), bringing its total fleet to 68 aircraft.
    • Since the start of the year, the carrier has added a total of seven freighters: three B757-200s and four B767-300s.
  • The Tata Group’s acquisition of Air India has been approved by the Competition Commission of India (CCI).
    • Following the divestment of Air India Limited, the Tata Group has won a bid to acquire the entire company, including the wholly-owned subsidiary Air India Express Limited (AIXL) and a 50% stake in Air India SATS. 
    • The total number of permanent and contractual Air India & AIXL employees is 13,500.

Europe/UK

  • FedEx predicts air cargo capacity in 2022 will once again be hard to secure as space will remain scarce. 
    • Karen Reddington, president of FedEx Express Europe, explained that passenger networks – and therefore bellyhold services – were taking time to resume and this would put cargo capacity under pressure. Supply chain issues caused by Covid are also likely to continue to impact the air cargo market, she said.
    • Air cargo capacity in the first two weeks of December was down by around 4% compared with the same period in the pre-pandemic year of 2019.
  • UK-based ACS called on volunteers from its Surbiton, Surrey headquarters to help unload by hand over 2m tests at Birmingham Airport last week from two preighter (passenger aircraft loaded with cargo) flights.

Road and Rail

UK van drivers will need new goods vehicle operating licences to enter EU from May

UK van drivers will be required to obtain new international goods vehicle operating licences if they want to travel back and forth to the EU from May next year. According to updates on the gov.uk website, anyone driving a van, a light commercial vehicle or any car towing a trailer will be required to have a “goods vehicle operator licence” to enter the EU, Iceland, Norway, Liechtenstein or Switzerland from 21 May, 2022.

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.

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 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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