Rachel Shames’ Market Update: Week #48
The Transpacific Eastbound freight market is very tight and expected to remain challenging through at least February 1, the start of the Lunar New Year (LNY) holiday. The very slight softening of volumes from select Asia ports over the recent months is not expected to continue in the short-term. All routings from the region are in high demand for the next 8-10 weeks, and rates are rising as a result. Outside of established, fixed contract allocation, most carriers are requiring high, premium level rates to secure space. There is very limited “standard” FAK space loading reliably at this point.
Equipment shortages are increasing in China and SE Asia ports including Ho Chi Minh. Capacity is challenged due to strong demand as well as structural blank sailings. Congestion at US ports, while improving, is still significantly impacting service schedules. Carriers are already canceling many China feeder services from smaller ports ahead of the LNY holiday, which will compound the equipment and space issues.
Air freight demand out of Asia and Europe is very high, with rates climbing each week. Space will remain tight through the December holidays, and through the LNY holidays on routes out of Asia.
In Europe, protests over COVID restrictions are causing disruption and delays at major ports including Rotterdam and Antwerp. More challenges are expected through at least year-end; congestion, vessel delays, truck capacity shortages, etc. are negatively impact cargo movement throughout the UK and the Continent, in addition to the usual holiday season capacity crunch.
In the U.S., there has been modest improvement in container dwell times at the major ports of Los Angeles and Long Beach. The controversial new long-dwell fee at LAX/LGB ports has been postponed for a third time, now set to become effective December 6. There is widespread industry optimism that the fee will eventually be canceled altogether. However, significant delays continue at the country’s largest gateway. As of December 1, there were over 70 vessels in port, plus an additional 70 vessels either at berth, anchored, or drifting close to the harbor. There are also dozens of vessels drifting farther off the coast, waiting for an opportunity to get in line.
U.S. export capacity is booked up 6-8 weeks on some lanes including Transpacific Westbound (US to Asia). First available bookings are in mid-to-late January in many cases.
Truck capacity in the US remains extremely difficult. It is imperative that all truckers are dispatched at least 30 days in advance; in some markets, a 6-week lead time is required. Rates are still on the rise and changing frequently. The situation will become more challenging throughout December, so please plan ahead.
Pease book ALL cargo early – at least one month in advance, for all trades/directions. Trucks and vessels are still booking up well in advance.
Your CVI team is here to assist you through these current market challenges. Ocean freight, air freight, domestic road/rail, and Customs Compliance – count on our dedicated professionals to care for you and your supply chain. Call us and let us show you what we can do!
Director, Pricing & Procurement
CV International, Inc.
Connect with us
Rachel serves as Director, Pricing and Procurement for CVI. Her responsibilities include vendor selection, contract management and negotiation, transportation pricing, FMC compliance, and international agent network management.
Rachel began her career in international shipping with CMA-CGM America. She joined CVI in 2011, gaining experience in various departments with a focus on inside sales and marketing for the company. In 2014, Rachel assumed the role of Manager, Transportation, working on service procurement and development of client proposals. She has served in her current position since 2018.
A native of Norfolk, Virginia, Rachel earned her bachelor’s degree from the University of Michigan in 2005. She holds a Master of Business Administration with a concentration in Maritime and Supply Chain Management from Old Dominion University.
– Rachel Shames, Director, Pricing & Procurement, CVI
Connect with Rachel