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How does the time of year impact container shipping costs?

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Container shipping is one of the most widely used modes of transportation for global trade, but it is also subject to various factors that affect its costs and availability. One of these factors is the time of year, which can have a significant impact on the supply and demand of container space, the rates and surcharges applied by carriers, and the risks and challenges faced by shippers and logistics providers. In this article, you will learn how the time of year affects container shipping costs and what you can do to plan ahead and optimize your transportation management.

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Māris Dreimanis

CEO at Vervo Group
Frank Gutiérrez

Estratega en Logistica

1 Seasonal fluctuations

Container shipping costs are influenced by the seasonal fluctuations of trade volumes, which depend on the demand patterns of different markets and regions. For example, the peak season for container shipping from Asia to North America and Europe usually starts in July and lasts until October, as retailers and manufacturers stock up for the holiday season and the end-of-year sales. During this period, the demand for container space exceeds the supply, resulting in higher rates, surcharges, and booking fees, as well as longer transit times, port congestion, and equipment shortages. Conversely, the low season for container shipping from Asia to North America and Europe occurs in the first quarter of the year, when trade volumes drop after the Chinese New Year and the winter holidays. During this period, the supply of container space exceeds the demand, leading to lower rates, discounts, and incentives, as well as shorter transit times, less port congestion, and more equipment availability.

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Māris Dreimanis

CEO at Vervo Group
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From my own experience, I can confirm that seasonal fluctuations have a significant impact on container shipping costs. I have seen prices change more than two times depending on the time of year and the market demand. For instance, during the Chinese New Year, which usually falls in late January or early February, many factories and businesses in China close for several weeks, causing a sharp decline in exports and imports. This affects the container shipping rates from Asia to other regions, as well as the availability of containers and equipment. Therefore, it is important to plan ahead and anticipate the seasonal changes in the container shipping market, and adjust your logistics strategy accordingly.

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Benard Kamusiime

Automotive and Power Engineer / Transportation and Logistics Manager / Health and Safety Officer
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Seasonal factors greatly impact logistical costs. This all comes back to demand for products and seasons like the festive seasons are known to have the most demand in countries for example East African countries. The his demand will see more traffic between August and September and increased costs due to delays with customs and fight for container space and storage. That's why demand forecasting is skill that logistics officers should have.

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Ghazanfar Ali Khan (FIATA CERTIFIED TRAINER)

Manager Customer Service (Imports) // EXPORTS// IMPORTS// SUPPLY CHAIN// LOGISTICS// CUSTOM CLEARANCE//TRANSPORTATION// FINANCE// ADMINISTRATION
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Time of year impact container shipping costs have many reasons, Global economy, Inflation, demand and supply imbalance, political polarization, No business ethics'

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Ricardo Cury

Trader e consultor em rela??es comerciais internacionais!
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N?o chamaria de "Sazonais" principalmente considerando que hoje a China participa de 30 ou 40% do comércio internacional e, nas festas chinesas estescequipamentos praticamente estacionam naquele País afetando a oferta e causando aumentos pela demanda.

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Frank Gutiérrez

Estratega en Logistica
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Me ha resultado interesante pero es importante tomar en cuenta que el periodo de 2020 al 2022 fue atipico y no se puede tomar de referencia, actualmente existe una demanda inconsciente y varios eventos que crean inestabilidad en las tarifas

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2 Weather conditions

Container shipping costs are also affected by the weather conditions of different regions and routes, which can pose risks and challenges for the safety and efficiency of container transportation. For example, the hurricane season in the Atlantic Ocean and the Caribbean Sea usually runs from June to November, and can cause delays, disruptions, and damages to container vessels, ports, and infrastructure, as well as higher insurance premiums and contingency costs. Similarly, the winter season in the Northern Hemisphere can bring snowstorms, icebergs, and fog to some of the major container shipping routes, such as the North Atlantic, the Baltic Sea, and the North Pacific, and can impair the visibility, navigation, and speed of container vessels, as well as increase the fuel consumption and emissions. On the other hand, the summer season in the Southern Hemisphere can offer more favorable weather conditions and lower risks for container shipping in some of the emerging markets and regions, such as South America, Africa, and Oceania.

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3 Market trends

Container shipping costs are also influenced by the market trends and developments of the container shipping industry, which can vary depending on the time of year and the strategic decisions of the carriers and shippers. For example, the carriers often adjust their capacity and services according to the seasonal demand and supply of container space, and may implement blank sailings, extra loaders, or alliance reshuffles to optimize their utilization and profitability. These actions can have a direct impact on the rates, availability, and reliability of container shipping for different routes and regions. Moreover, the carriers may also introduce or revise their rates and surcharges based on the changes in their operating costs and market conditions, such as the fuel prices, the exchange rates, the port fees, and the regulations. These changes can affect the total cost of container shipping for different modes and sizes of containers. Additionally, the shippers may also change their sourcing and distribution strategies according to the market trends and opportunities, and may diversify their suppliers, customers, or markets to reduce their dependence on a single region or route. These changes can affect the demand and supply of container space for different origin-destination pairs and trade lanes.

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Frank Gutiérrez

Estratega en Logistica
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Esto aplicaría si no cambiará ninguna condición actualmente el bloqueo en mar Rojo es el evento que más impacta en las tendencias dejando con escasez de contenedores al mediterráneo y aumentando el tiempo de tránsito para ruta de Europa a Asia

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4 Best practices

Given the various factors that affect container shipping costs throughout the year, it is important for shippers and logistics providers to plan ahead and optimize their transportation management. To do this, they should monitor the market trends and developments of the container shipping industry and stay up-to-date on rates, surcharges, and services offered by different carriers and routes. Additionally, forecasting demand and supply of container space for different regions and seasons can help secure bookings and contracts in advance. Comparing costs and benefits of different modes and sizes of containers based on cargo characteristics, transit time, and reliability is also key. Furthermore, mitigating risks and challenges of weather conditions and natural disasters by tracking container vessels and ports, having contingency plans, backup options, and insuring cargo can help. Finally, leveraging technology such as digital platforms, online booking systems, real-time tracking devices, and smart containers can improve visibility, efficiency, and security of container transportation. By following these best practices, shippers can optimize their transportation management and achieve their business goals.

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Frank Gutiérrez

Estratega en Logistica
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Estoy de acuerdo, pero es importante también aprovechar la data de tus embarques haciendo cada vez más óptimo su operación ?, de una manera ordenada

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5 Here’s what else to consider

This is a space to share examples, stories, or insights that don’t fit into any of the previous sections. What else would you like to add?

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How does the time of year impact container shipping costs?

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3

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5

1 Seasonal fluctuations

2 Weather conditions

3 Market trends

4 Best practices

5 Here’s what else to consider

Transportation Management

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How does the time of year impact container shipping costs?

1

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1 Seasonal fluctuations

2 Weather conditions

3 Market trends

4 Best practices

5 Here’s what else to consider

Transportation Management

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