Ocean and Air Freight rates last news.

FLASH: FREIGHTOS, JUNE 4TH, 2024

Ocean rates - Freightos Baltic Index

Asia-US West Coast prices (FBX01 Weekly) increased 2% to $5,030/FEU

Asia-US East Coast prices (FBX03 Weekly) increased 6% to $6,724/FEU

Asia-N. Europe prices (FBX11 Weekly) increased 3% to $5,022/FEU

Asia-Mediterranean prices (FBX13 Weekly) stayed level at $5,640/FEU

Air rates - Freightos Air Index

China - N. America weekly prices decreased 5% to $5.43/kg

China - N. Europe weekly prices fell 4% to $3.87/kg

N. Europe - N. America weekly prices fell 2% to $1.7/kg

?Analysis

The early arrival of the peak season for ocean shipping has significantly impacted the industry, leading to congestion, equipment shortages, and higher prices. Approximately 7% of total shipping capacity is currently tied up due to global congestion. The most severe congestion is currently in Singapore, where diversions have increased transshipment volumes. The port is even reactivating an out-of-use terminal to handle the backlog of vessels. Unlike the Red Sea-driven vessel bunching, North Europe and North America are not experiencing the same level of congestion. Recent backlogs at ports in Savannah and Charleston were attributed to infrastructure projects and software problems.

The increased demand and decreased supply have pushed shipping rates back to or above their early-year peaks. With capacity and equipment scarce and spot rates several thousand dollars above long-term contract levels, annual agreements are becoming unreliable. A recent survey found that nearly 70% of BCOs and forwarders with long-term ocean contracts have had containers rolled or faced contract renegotiations.

Air cargo demand remained strong in May, but the new round of ocean disruptions has not caused a surge in air cargo volumes yet. B2C e-commerce volumes have been the main driver of strong demand, tight capacity, and elevated rates from China to North America and Europe. However, it's important to note that some platforms like Temu and Shein are facing significant challenges. In addition, the US Customs and Border Patrol has increased reporting requirements and inspections for de minimis exemption imports, leading to congestion at LAX last week.