2024 Will Not be Boring

Welcome to our latest blog post, where we dive into the current state of the global freight market. In January, the sea freight sector grappled with ongoing uncertainty, driven by capacity limitations and equipment challenges exacerbated by vessel rerouting due to geopolitical tensions. Attacks on vessels in the Red Sea prompted many carriers to seek alternative routes, impacting import freight to both coasts of North America. Meanwhile, in the air freight arena, we anticipate rate increases ahead of Lunar New Year as some ocean freight shipments divert to air. Looking ahead, we explore the post-Lunar New Year landscape, significant blank sailings in February, and strategies to navigate potential delays and disruptions caused by winter weather across the US. Join us as we unpack the latest trends and insights shaping the freight industry in the coming months.

Asia to North America

The container market continues to experience uncertainty in January. Capacity limitations and challenges with shipping equipment, caused by ships being rerouted, contributed to market pressures. Ongoing attacks on vessels in the Red Sea by Houthi forces led many carriers to divert ships away from the Suez Canal. Instead, they opted for the longer and more expensive route around the Cape of Good Hope for Asian imports or waited in line at the Panama Canal. Consequently, import freight to both coasts continued to rise, reaching the highest levels since the fourth quarter of 2022.

Europe to North America

Market demand has held steady in January, with no anticipated spikes until at least March. Carriers continue to blank and cut capacity. Carriers will continue to divert capacity to address the Red Sea situation. The Red Sea situation has led to increasing rates for vessels on Transatlantic routes, and further increases are expected in February with carriers announcing GRI/PSS and emergency surcharges. Additionally, equipment shortages are impacting Austria and some areas of southern Germany, with the full impact likely to be seen later, depending on the outcome of the current German railway situation.

Asia to North America

Expect air freight rates to increase ahead of Lunar New Year as some ocean freight shipments divert to air freight.

Post Lunary New Year

• Post Lunary New Year – In contrast to the pandemic period, where a continuous increase in volumes led to port congestion worsening over time, carriers, particularly after the Lunar New Year (LNY), are expected to establish a new routine. This will ensure a smoother flow of containers, preventing significant congestion. As the market typically experiences a slowdown post-LNY, transit times may stay longer but are likely to become more predictable. There is a possibility that prices will decrease somewhat, although they may remain elevated until Red Sea traffic resumes.
• Expect significant blank sailings in February.
• For time sensitive East Coast cargo we recommend shipping to West Coast and either trans load or connect to rail option if available.
• Winter weather across the US may continue to impact cargo movement.
• Expect delays and book ahead if possible!

West coast ports brace for new import surge – ‘but they can cope this time’
US west coast ports are bracing for a surge in imports, driven by the convergence of supply chain and geopolitical chaos – and there’s little sign of an imminent return to normal.
– Read More

Union Pacific expects shipment delays as harsh winter impacts rail network
Jan 9 (Reuters) – Union Pacific Corp (UNP.N), opens new tab said on Tuesday it anticipates a 24- to 48-hour delay in shipments as its rail network in some states has been impacted by heavy snow, blizzard conditions, ice and power outages.
– Read More

Countries shy away from US coalition to protect Red Sea shipping
A US-led initiative to deter attacks against international shipping transiting the Red Sea has struggled to get off the launchpad, seemingly amid concern over its political framing.
– Read More

Shipper switch to air freight will see rates take off next week
Shippers are eyeing “surgical” use of airfreight to mitigate the increasing delays caused by the Red Sea crisis. Airfreight data is not yet showing any real change in rates, despite the disruption at sea – but this is likely to change next week.
– Read More

Shippers beware: a US east coast labour battle could be heating up
The National Retail Federation (NRF) is getting nervous about a strike hitting US east coast terminals in October – others should be too. NRF president and CEO Matthew Shay wrote to International Longshoremen’s Association (ILA) president Harold Daggett and United States Maritime Alliance (USMX) chairman and CEO David Adam, urging both sides to restart contract negotiations as soon as possible.
– Read More

Hapag-Lloyd, Maersk to form new alliance from 2025
FRANKFURT, Jan 17 (Reuters) – Container vessel operators Hapag-Lloyd (HLAG.DE), opens new tab of Germany and Maersk (MAERSK.CO), opens new tab of Denmark said on Wednesday they will form a new alliance from February 2025.
– Read More

EU states give nod to Red Sea mission to deter Houthis -diplomats
BRUSSELS/PARIS, Jan 16 (Reuters) – European Union member states have given initial backing to a naval mission to protect ships from attacks by Yemen’s Iran-backed Houthi militia in the Red Sea, European diplomats said on Tuesday, after the launch of a U.S.-led mission in the region.
– Read More

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