Weekly Market Updates

Zencargo Market Update: 7th November

Nov 07, 2022

Shippers faced with navigating a volatile consumer environment 

As we approach peak season for retailers, forecasting sales and demand planning pose a significant challenge to shippers in an uncertain economic landscape. In the face of rising inflation and the cost of living crisis shippers are confronted with ensuring accuracy in stock levels to meet consumer demand without overstocking. This has been reflected in the recent ‘destocking’ trend as retailers attempt to balance stock levels in the reaction to uncertain predictions of consumer spending in Q4, with recent data from Deloitte indicating that 39% of consumers are expecting to spend less this Christmas, than in 2021. Accurate demand planning is no small feat as the ramifications of poor demand planning can result in a warehouse full of unsold products or missing sales due to an item being out of stock.

In this environment having data visibility of your shipments is critical to ensuring you have a flexible approach to your supply chain. By leveraging SKU level data shippers are able to create contingency plans, rebalance inventories and explore alternate transport options to help navigate the current climate and mitigate the risks of over/understocking. 

In a recent episode of Freight to the Point we were joined by Finnur Bragason who is the Sales Director at our partner AGR Dynamics, that specialises in providing demand planning and forecasting solutions. In the episode we discuss the importance of demand planning and how using Zencargo’s platform, organisations can match demand and supply more effectively by utilising historical SKU data. Empowered with this data businesses can better understand lead times, supplier performance and costs, to build better forecasts and revise them according to live supply data.

Port of Liverpool strikes

In other news, further strike action has been announced at the Port of Liverpool from the 14th to the 21st of November as a part of an ongoing pay dispute between workers and port operators. This latest action will mark the fourth time strikes have taken place in the last 60 days and is expected to impact all shipments into and out of the port during the strike dates. It is recommended that you reach out to your freight forwarder to see if your shipments will be impacted and to discuss a strike strategy to mitigate risk in future. 

If you would like to discuss demand planning, formulating a strike strategy or other freight forwarding needs we also offer free 1:1 strategy discussions with our Co Founder Richard Fattal who can advise on everything from market trends to supplier negotiation. Book a call now to find out more.

China

Ocean

  • Rates have continued to decline this week
    • Port congestion improvements in Europe and USA are contributing to the fall in rates.
    • Rates from Shanghai to Europe fell by 16.13% from last week.
    • Rate decreases are expected to continue through November with rates even closer to pre-pandemic levels.
  • The average delay time of container ships has continued to decrease since the beginning of the year.
    • The average delay currently sits at 5.81 days discretion by 0.1 days from October.
    • Port delays to Northern Europe have improved, now averaging 5 days.

Air

Central China to USA and Europe

  • Rates have decreased from both SHA and NGB to Europe and USA  due to lower demand. 
    • Final rates to USA from BGB will be on a case-by-case basis.
  • It is recommended to reach out 4-5 days prior to cargo ready date to confirm space and rate.

North China to USA and Europe 

  • The air freight market has seen minor rate decreases  from TSN to Europe and to the USA, however the market is fairly unstable and could see rate hikes in future.
    • Air China, Lufthansa and Singapore Airlines have passenger flights that can provide spot rates for dense cargo to Europe.
  • From PEK to Europe and the USA, rates have decreased slightly however space remains tight. 
    • It is recommended to provide the cargo ready day and and reconfirm rate  4-5 days in advance.
    • Special rates and target rate matching can be provided for dense cargo. 
  • From TAO to Europe and the USA, rates have remained stable with minor changes from last week.
    • Air China service from TAO to LHR has resumed.
    • Air China  services from TAO to LHR via CDG  have seen a small rate increase.
    • Space is tight on flights this week from TAO to USA.
  • Compared to last week, rates have remained the same from CKG to Europe and have increased slightly from CKG to the USA. 
    • Qantas is offering direct flight to ORD, LAX. 

South China to USA and Europe 

  • Rates remained the same as last week from CAN to Europe and the USA.
  • From SZX to Europe and the USA, the market is stable.
    • Rates for dense and volumetric goods  can be negotiated with carriers on a case-by-case basis. 
  • From XMN to Europe and the USA rates have remained the same compared to last week and to be confirmed on a case by case basis.
USA

Ocean

  • On 2nd November, longshoremen at the Port of Oakland staged a walk-out.
    • On the morning of 2nd November, the port’s Everport, TraPac, OICT and Howard terminal were closed, however the Matson and Shippers Transport Express terminals remained open. However, terminals reopened by the time the evening shift began. 
    • The walk-out was not an official ILWU action and was an initiative carried out by the workers at the Port of Oakland.  
    • Although workers at the Port of Oakland are working without a contract, the real reason for the walk-out was reported to be that  workers were not being paid on time. 
  • The Port of Houston will implement a container dwell fee to incentivise cargo movement. 
    • Long-dwelling loaded import containers have contributed to congestion at the terminals and a shortage of chassis. 
    • The port has not yet disclosed details regarding the fee amounts however,they have announced that it will be effective from 1st December. 
    • According to the Port of Houston, they are yet to see softening import loads and to maintain efficient operations, container dwell times must be minimised.
Benelux

Ocean

  • Due to the construction of the Maasdelta Tunnel, The Port of Rotterdam Authority has announced that partial closures of the Scheur will happen throughout November. 
    • Partial closures will occur between kilometre posts 1015 and 1018. Caution has been issued especially between the 8th to 25th November. 
    • The Port of Rotterdam has advised that vessels should travel at moderate speeds and follow directions. 
    • The tunnel is expected to be completed by 2024.
UK

Ocean

  • The UK introduced legislation on 3rd November that bans the use of insurance services for the maritime transportation of Russian oil. 
    • The ban is effective from 5th December for Russian crude exports and 5th February for refined oil products. 
    • However, cargo that is purchased below the G7’s planned price cap will be exempt. Details on this are yet to be finalised. 
    • Details are yet to be finalised.

Road

  • As mentioned above, industrial action has been announced at the Port of Liverpool between 14th-21st November. 
    • Hauliers have expressed their concerns over the future of their businesses as strikes will affect their operations. 
    • When industrial action occurs at ports, hauliers are affected as there are less volumes for them to handle. 
    • The disruption has had a devastating effect on haulier businesses who have volume commitments to their customers. 

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.

November 9th – Spain 

November 11th – Austria, Belgium, France, Poland

November 15th – Austria, Belgium

November 16th – Germany

November 17th – Czech Republic, Slovakia 

November 18th – Croatia, Latvia 

November 30th – Romania

December 1st – Portugal, Romania

December 2nd – Romania

December 3rd – Spain

December 6th – Finland, Spain 

*Not in all regions

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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