Carriers warn of ‘imminent critical congestion’ at major ports like Rotterdam and Felixstowe, says Freightos. Two weeks after the Suez blockage, global trade is beginning to feel the “slow-moving hit” on both ocean shipping capacity and pricing, according to the latest international freight update published by digital rates specialist Freightos, which incorporates the Freightos Baltic Index (FBX).
As carriers warn of imminent critical congestion at major ports like Rotterdam and Felixstowe, and resulting delays, equipment shortages and cancelled sailings, freight rates have already begun to rise on some lanes, with Asia-US East Coast rates now 8% higher than at the time of the blockage, it noted.
Transatlantic rates have now spiked 53% in the past two weeks to a multi-year high of $3,357/FEU, as congestion is impacting empty container availability in Europe and carriers cancel sailings, possibly to move capacity to the directly-impacted lanes, Freightos’ analysis revealed.
“Estimates of how long the strongest ripples from the Suez will last range from the next three to six weeks. Either way, it will likely take months to recover completely. Of course, “back to normal” is a relative term this year, and with the recovery only in sight towards the start of peak season, observers expect no significant respite from delays and elevated rates before the end of the year, explained Freightos’ Research Lead, Judah Levine.
“Though Asia-US West Coast rates haven’t climbed yet, congestion is still a problem with more than 20 ships now waiting outside not just Long Beach but Oakland too. And the latest indications are that demand driving the backlog isn’t letting up. The National Retail Federation expects import volumes to be 14% higher this month than in April 2019 – only 10% lower than the all-time high in October – and to stay that way before climbing again this summer,” he added.
China-US West Coast prices (FBX01 Daily) decreased 9% on last week to $4,876/FEU – 204% higher than the same time last year.
China-US East Coast prices (FBX03 Daily) increased 4% to $6,112/FEU, and are 116% higher than rates for this week in 2020.
China-North Europe rates were unchanged on the previous week at $7,297/FEU but showed an increase of 420% year over year (YoY). North-Europe-US East Coast prices rose 18% to $3,357/FEU and are 69% higher than the corresponding week last year.
The ‘global FBX rate was down 1% on last week at $4,220/FEU and up 188% YoY.
Strong demand is keeping air cargo rates climbing too with Freightos marketplace data showing Asia-US rates doubling to most destinations over the last month, and rising fuel costs a threat to additional pressure on prices.
Source: Lloyd´s
