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: The race to add capacity before rates drop

Who’s winning the race to add new capacity to the market?

 

Source: Alphaliner

A new report from Alphaliner highlights the rush from liner operators to add more capacity during this era of peak rates. A comparison of the top 12 carriers’ capacity between January 1 and today identifies five leaders in adding capacity.

  • MSC and Wan Hai have been the most successful buyers of tonnage on the second market
  • Zim has been active in the charter market finding extra tonnage for its new Transpacific services.
  • HMM and Evergreen happened to have a lot of new building deliveries planned for the first half of this year, luckily.

MSC has been the fastest growing operator this year in terms of actual slots (+177,691 teu) as the Geneva-based carrier took delivery of two more 23,656 teu ships. Meanwhile, Maersk’s capacity growth in H1 still remains limited to 0.5% of its current size, putting MSC on course to become the new number one in liner shipping.


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Ocean

Asia → North America

Rates

  • Hapag-Lloyd has announced a new PSS effective July 18 applicable for all dry, reefer, flat rack and open top containers from East Asia to US and Canada:
    • USD 1000 per all 20′ container types
    • USD 2000 per all 40′ container type

Capacity

  • Maersk will launch two new weekly services, the TPX and TP20, to add more capacity. These services will be independent of the 2M alliance.
    • TPX will call at Yantian and Ningbo in China, finishing at LA.
    • TP20 will call at Vung Tao, Vietnam, Ningbo and Shanghai in China and Norfolk and Baltimore on the US east coast.

Equipment:

  • Shippers should still expect a delay of around three days waiting to collect containers once discharged.

Ports

  • CMA CGM has announced a port congestion surcharge of US$250 per TEU for all types of cargo from Latin America to the Port of Oakland in the United States.
  • The port of Long Beach has signed a four-year partnership agreement with the Utah Inland Port Authority (UIPA) in an effort to ease congestion in the long term.

Asia → Europe (Far East Westbound)

Rates

  • SCFI (Spot rate Index) to North Europe reached next record of 6,479USD/TEU for Week 25/2021
  • Following GRIs announced last week, rates now sit between $14,000-15,000 for the majority of carriers and $19,500 for MSC in the first half of July.

Capacity

  • Capacity expected to remain tight going into peak season as sufficient demand remains to outperform max capacity.
  • CMA, COSCO and MSC have canceled space previously released.
  • Chinese ports are still dealing with a backlog from Yantian disruption
    • Yantian reports a waiting time of 7 days to berth
    • Shakou reports a waiting time of 4 days to berth

Equipment

  • There is currently a severe shortage of 40ft high cubes, but still availability for standard 40ft containers.
  • There is also available stock of 20ft containers.

Ports

  • Rotterdam remains congested, with both Ocean Alliance and THE Alliance omitting calls, with the former also missing Flexistowe.
  • A shortage of truck drivers in the UK is causing delays in getting containers out of ports.
Carriers POL 20GP 40GP 40HQ
HPL NINGBO Shortage Shortage Shortage
SHANGHAI Shortage Normal Shortage
YANTIAN Normal Normal Shortage
SHEKOU Normal Shortage Shortage
MSK QINGDAO Shortage Shortage Shortage
SHANGHAI Shortage Shortage Shortage
NINGBO Shortage Shortage Shortage
Nanjing Shortage Normal Shortage
Xiamen Shortage Normal Shortage
YANTIAN Normal Normal Shortage
SHEKOU Normal Shortage Shortage
NANSHA Normal Normal Shortage
HONGKONG Normal Normal Shortage
SHANTOU Normal Normal Shortage
ONE YANTIAN Normal Normal Normal
SHEKOU Normal Normal Shortage
XINGANG Normal Shortage Shortage
QINGDAO Normal Normal Shortage
SHANGHAI Normal Normal Normal
NINGBO Shortage Shortage Shortage
ZIM XIANGANG Normal Shortage Shortage
NINGBO Normal Shortage Shortage
SHANGHAI Normal Shortage Shortage
YANTIAN Normal Shortage Shortage
SHEKOU Normal Shortage Shortage
HMM SHANGHAI Normal Normal Shortage
NINGBO Normal Shortage Shortage
YANTIAN Normal Normal Shortage
SHEKOU Normal Normal Shortage
MSC SHANGHAI Normal Shortage Shortage
NINGBO Shortage Normal Shortage
YANTIAN Normal Shortage Shortage
SHEKOU Shortage Normal Shortage
EMC YANTIAN Normal Normal Shortage
SHEKOU Shortage Normal Shortage
NINGBO Shortage Normal Shortage
SHANGHAI Normal Shortage Shortage
QINGDAO Normal Shortage Shortage
OOCL YANTIAN Normal Normal Normal
SHANGHAI Normal Normal Normal
NINGBO Normal Normal Normal
CMA QINGDAO Shortage Shortage Shortage
SHANGHAI Shortage Shortage Shortage
NINGBO Shortage Shortage Shortage
YANTIAN Shortage Shortage Shortage
SHEKOU Shortage Shortage Shortage
cosco YANTIAN Normal Normal Normal
SHEKOU Normal Normal Normal
SHANGHAI Normal Normal Shortage
NINGBO Normal Normal Shortage
QINGDAO Normal Normal Shortage
DALIAN Normal Normal Normal
XINGANG Normal Normal Normal
YML YANTIAN Normal Normal Shortage
SHEKOU Normal Normal Shortage

Europe → USA (Transatlantic Westbound)

Rates

  • CMA has announced a new PSS from Europe to North America, effective from August 1st:
    • East Coast: $1,000/ 20′, $1,250/ 40′
    • West Coast: $1,000 /20′, $1,500/ 40′
  • Strong volume performance and cargo backlog are likely to drive rates further up during Q3

Capacity:

  • ONE and Yang Ming are reported to not have space until mid-August, though MSC have some pockets of space.
  • A streak of blank sailings due to vessel maintenance will be implemented by THE Alliance and Ocean Alliance in week 29 and 31 on the USWC service.

Ports:

  • Hapag-Lloyd have announced a Congestion Surcharge of USD 350 per container for all intermodal moves in the US effective upon carrier receipt of cargo on or after August 1, 2021 until further notice.


Air

Asia

US market

  • Space and rate situation out of China is critical this week as worsening congestion and capacity issues add to backlogs of ocean freight cargo and increase the volumes of ocean to air freight conversions.
  • Only highest paying cargo is guaranteed to make it on to a flight
  • Some converted passenger flights are being changed to domestic flights to accommodate summer holiday travel
  • Spot rates available for heavy/dense cargo as well as volume cargo.
  • For all airports – rates and space must be checked on a case by case basis.

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

  • Space and rate situation out of China is critical this week as worsening congestion and capacity issues add to backlogs of ocean freight cargo and increase the volumes of ocean to air freight conversions.
  • Only highest paying cargo is guaranteed to make it on to a flight
  • Some converted passenger flights are being changed to domestic flights to accommodate summer holiday travel
  • Rates and space must be checked on a case by case basis.
  • Spot rates available for heavy/dense cargo as well as volume cargo.

UK market

  • Space and rate situation out of China is critical this week as worsening congestion and capacity issues add to backlogs of ocean freight cargo and increase the volumes of ocean to air freight conversions.
  • Only highest paying cargo is guaranteed to make it on to a flight
  • Some converted passenger flights are being changed to domestic flights to accommodate summer holiday travel
  • There are direct flights with CA/BA, AIR-AIR by SQ and normal air-truck service. Space using deferred carriers is fully booked.
  • Rates and space must be checked on a case by case basis.
  • Spot rates available for heavy/dense cargo as well as volume cargo.

Americas

  • Rates have increased 20-30% in the last week into UK, Europe and Asia
  • Space remains constricted due to reduced capacity.
  • There are still backlogs at the handling sheds at main airports, resulting in long queues when collecting/delivering cargo. This will only get worse when the new screening regulations come into play on 1st July.
  • US hauliers are currently over capacity and over booked causing more delays.

Europe

  • Rates into North America have increased this week, while rates into Asia remain stable.
  • Capacity to most regions remains severely restricted

Road

Availability

Availability generally reliable across all routes and regions.

Rates

Rates are fluctuating in and out of Italy, but remain stable across consolidated, groupage and dedicated trailers on other routes.

Customs

Border situations have improved considerably with clearances running smoothly.

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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