Weekly Market Updates

Zencargo Market Update: 11th July

Jul 11, 2022

In focus: Further lockdowns in China as covid cases rise

Mass testing is currently underway for the population of Shanghai as China has experienced a spike in covid cases. This has resulted in a partial lockdown in some regions of China such as the city of Xian. 

Although the rise in cases has not yet impacted shipments, there is growing concern that local lockdowns in China will result in further congestion in already strained ports.

In addition to restrictions, Chinese vessels have been affected by typhoons, impacting operations in Ningbo, Shenzhen and Hong Kong, and resulting in fewer vessels berthing.

China

Ocean

  • Vessel utilisation has dropped for the first time in 2 years resulting in carriers lowering rates to fill vessels.
  • Container trade statistics show that volumes were down by 3% from this year to last year.
    • This indicates that levels are hitting those seen pre-pandemic.
  • Peak season, expected in late July and August, could see worsening congestion leading to potential delayed or blank sailings.
    • This will put pressure on capacity and therefore, rates are likely to  increase.
  • Transit times are improving from China to West Coast ports from 34 to 20 days.
  • The average waiting time for vessels to berth at Shanghai is up 12 to 24 hours.
  • Most terminals have severe congestion at Ningo due to monsoons which may also result in port closures.
  • There is potential for longer berthing times at Yantian for vessels arriving from high-risk ports due to covid testing requirements.
  • Qingdao has been impacted by fog and bad weather resulting in an average waiting time of 48 to 96 hours.

Air

Central China to USA and Europe

  • Rates are stable compared to last week.
    • There has been a decrease in rates for flights from Central China to USA.

North China to USA and Europe

  • TSN is expecting to have a high demand throughout July.
    • Due to the high amount of cargo entering the airport, there is already a large sum of cargo waiting in warehouses at the terminal.
    • Airlines are requesting that trucks are ready for collection and have advised that the handling process will take longer before the flight departures.
    • Due to covid outbreaks in the Tianjin area, terminal warehouses will be running on low staff, resulting in longer handling times.
  • Although rates stay the same from last week, PEK has limited space and there are risks that flights to LHR may be changed or rescheduled.
  • There is a 10 day quarantine for all air imports to PEK airport starting this week.
  • TAO has a lot of space remaining for this week with the rate to Europe staying the same as last week.
    • JD direct flights to LHR have been suspended and the resume date is still uncertain.
  • The capacity at CKG airport is still stable but the rate has slightly increased this week.

South China to USA and Europe

  • Rates have increased for flights from SZX to Europe and there is a high demand for volume resulting in limited space. 
    • Rates may be stable for the next one to two weeks, but this is subject to change as the demand is slowly increasing.
  • Flights to USA from SZX have not seen as much of an increase in demand, resulting in stable space and rates.
Benelux

Ocean

  • As the holiday season has started, ports in the Netherlands have already started to see labour-related impacts.
    • Delays are being rectified by additional holiday workers scheduled to start work next week.
  • Congestion continues at Antwerp and Rotterdam. 
    • Rotterdam terminal is facing long dwell times and limited yard storage.
UK and Rest of Europe

Ocean

  • Vessels have a high utilisation rate leading to a shortage of space and increased rates.
    • As peak season hits at the end of July, it is expected that it will become even more difficult to get space and rates will increase further.
  • Labour disputes have led to delays and congestion at North Continental ports in Europe which could potentially take a couple of months to clear.
  • Space is tight, and it is recommended to book a minimum of 4 weeks in advance.
  • There are equipment shortages in Spain and Portugal leading to high rates.
  • Southampton Port has had a reduction in labour resulting in longer handling times.

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.

July 11th – TR

July 12th – Northern Ireland, TR

July 13th – ME, TR

July 14th – FR, ME

July 21st – BE

*Not in all regions

The route ahead

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