Logistics Market Update December 2024

Monthly Highlights

  1. Proposed Legislation Targets China Imports


    New legislation introduced in the U.S. would require 10% of all imports from China to be transported on U.S.-flagged ships. This move aims to bolster domestic shipping industries but could also lead to higher costs and potential supply chain disruptions for companies relying heavily on Chinese goods. Stakeholders are closely monitoring the potential impact on global shipping dynamics.

          Source: FreightWaves

  1. Port Strike Threat Boosts Trans-Pacific Rates


    The looming threat of port strikes on the U.S. West Coast has led to a surge in trans-Pacific container rates. Shippers, seeking to avoid disruptions, have turned to alternate routes, driving up costs. Spot rates on the trans-Pacific route increased by nearly 15% in the last month alone, highlighting the ripple effects of labor tensions on global shipping.

          Source: FreightWaves

  1. Global Trade Routes See Major Shifts


    Recent ocean and airfreight data reveal significant changes in global trade patterns. With geopolitical tensions and new trade agreements reshaping demand, traditional routes are being replaced by emerging ones. These shifts are creating opportunities for new logistics hubs but also pose challenges for companies needing to adapt quickly.

           Source: Air Cargo Week

Key Takeaways

  • Proposed U.S. Legislation on China Imports: The new requirement for 10% of Chinese imports to move on U.S.-flagged ships could lead to increased shipping costs and supply chain adjustments, creating challenges for companies dependent on imports from China.
  • Trans-Pacific Rate Surge: The fear of U.S. port strikes caused trans-Pacific container rates to rise nearly 15% as shippers rerouted cargo to avoid potential disruptions. This reflects the significant impact labor uncertainties have on global shipping costs and operations.
  • Global Trade Route Shifts: Changes in ocean and airfreight patterns, driven by geopolitical and economic factors, are creating new logistics opportunities but also pressuring companies to adapt quickly to evolving trade dynamics. Traditional routes are being replaced by emerging alternatives, reshaping the global trade landscape.

Ocean Freight Market Update

Rate Trends and Capacity Adjustments

  • Freight Rates: As of December 2024, ocean freight rates remain significantly higher than the same period last year. The Shanghai Containerized Freight Index (SCFI) indicates year-over-year increases of +255% to Europe, +245% intra-Asia, +147% to the U.S. West Coast, +128% to Oceania, and +96% to South America.
  • Capacity Outlook: The idle fleet of containerships has reached an all-time low of less than 1% in 2024, with larger ships of 12,500+ TEU showing almost no idling. Annual dry container production could reach 7.3 million TEU, surpassing previous years with a 6.5% year-over-year growth.

Market-Specific Insights

  • North Europe and Mediterranean: Rates have declined further as peak season demand subsided, and shipping lines compete aggressively on these routes.
  • Asia-U.S. West Coast: Despite the rush to bring forward U.S. imports due to potential new tariffs, Transpacific freight rates have shown slight decreases. Several carriers have announced new rates starting December 1st in anticipation of the pre-Chinese New Year rush.
  • South America: Rates remain much higher than the same time last year, with a 96% increase year-over-year.

Environmental and Compliance Developments

  • IMO 2024 Regulations: The implementation of stricter International Maritime Organization (IMO) 2024 environmental regulations has prompted some carriers to upgrade fleet technologies. However, the associated costs are expected to reflect in long-term freight rates.
  • EU Emission Trading System (ETS): The share that carriers need to surrender for their emissions under the EU ETS is increasing to 70% from January. Additional ETS surcharges are expected in 2025.

Congestion and Reliability

  • Schedule Reliability: Global schedule reliability has improved marginally, reaching 60%. However, challenges such as port congestion and vessel delays persist. Carriers have responded with better planning and adjusted port rotations, but these improvements have not yet significantly alleviated supply chain disruptions.

Air Freight Updates

Peak Season Performance

  • Demand Surge: The holiday shopping season has driven an uptick in air freight demand, especially for e-commerce and consumer electronics shipments.
  • Capacity Constraints: Limited aircraft availability due to maintenance backlogs and crew shortages has led to tighter capacity.
  • Rate Increases: Global spot rates have surged, with some high-demand routes experiencing double-digit percentage rate hikes

Region-Specific Developments

  • Asia-Pacific: Strong demand for electronics shipments has pushed rates higher, particularly on trans-Pacific lanes.
  • Europe: Airlines are facing capacity shortages due to increased demand for automotive and high-value industrial parts, contributing to regional rate increases.

Disruptions and Delays

  • Weather Events: Recent hurricanes have disrupted air cargo operations, causing shipment delays and congestion at key airports in affected regions.
  • Geopolitical Tensions: Conflicts in various regions have disrupted air freight routes, forcing carriers to reroute flights, leading to extended transit times and increased costs.

Technological Advancements

  • Cargo Tracking Systems: Airlines continue to adopt advanced cargo tracking systems, offering better visibility and improved service levels for high-priority shipments.
  • Drones for Last-Mile Deliveries: Some carriers are testing drones for last-mile deliveries in remote areas, showcasing future possibilities for e-commerce logistics.

Freight Market and Amazon News

New U.S. Legislation on Chinese Imports

New U.S. legislation mandates that 10% of Chinese imports must be transported on U.S. ships, impacting the global shipping market and trade routes.
Source: FreightWaves

Amazon’s Price War Against Chinese Sellers

Amazon is targeting Chinese sellers offering low-cost goods on platforms like Temu, intensifying competition and shaping pricing strategies for global sellers.
Source: TechNode

Amazon Requests Price Adjustments from Chinese Sellers

Amazon has urged Chinese sellers to avoid offering prices lower than those on rival sites,marking a shift in pricing dynamics for global e-commerce.
Source: SCMP

Forceget Supply Chain Provider is a leading NVOCC licensed global logistics company that specializes in parcel, air and ocean shipping. With offices in key locations such as the USA, China, Hong Kong, Turkey, Israel and Colombia, we are well-positioned to assist you with all your logistics and brokerage needs, no matter where you are located. We take care of all the complexities of international shipping, allowing you to focus on what you do best – competing in your local market. Additionally, we pride ourselves on being the number one Amazon FBA focused freight forwarder, ensuring that your products are delivered to Amazon warehouses in a timely and cost-effective manner. With Forceget, you can have peace of mind knowing that your global logistics needs are in expert hands.

 

Logistics Market Update November 2024

November 2024

Monthly Highlights

U.S. East Coast Port Strikes: What to Know 

Port workers on the U.S. East and Gulf Coasts reached a temporary agreement in early November to avert a strike. While this provides short-term relief, tensions remain high, and further action may occur in January 2025, creating uncertainty for shipping operations. Shippers are rerouting cargo to avoid delays, leading to increased congestion at alternate ports.

Source: https://www.cbsnews.com/news/east-coast-port-strike-what-to-know/

Air Cargo Demand Surge Amid Increased Competition

Air freight demand remained strong throughout November, with airlines and freight companies adjusting schedules to meet the peak holiday season demand. However, growth showed as the global air cargo market saw only a 3% increase compared to the previous year. At the same time, global spot rates rose to $2.71 per kiogram, marking the fourth consecutive month of double-digit growth in air cargo rates. 

Source: https://www.aircargonews.net/airlines/air-cargo-demand-up-again-in-september-but-growth-narrows/

Supply Chain Disruptions from Hurricane Milton

Hurricane Milton disrupted shipping operations in Florida, particularly affecting Port Tampa Bay. Closures at the port caused significant congestion, increasing dwell times by 25%. Florida’s citrus industry was also severely impacted, with estimated crop losses of 30% and a 15-20% rise in prices. Shipping delays of 3-5 days are expected due to road closures and disrupted logistics.

Source: https://www.freightwaves.com/news/milton-threatens-ripple-effects-across-global-supply-chains

Key Takeaways

  • The threat of U.S. East and Gulf Coast strikes, although temporarily resolved, led to significant congestion at alternate ports. Container dwell times rose by 15%, and linehaul rates spiked by 8% in the impacted areas. 
  • Despite a slower growth rate in air cargo volume, rates continued to rise sharply, with global spot rates up by double digits for four months in a row. 
  • The logistics market faces mixed conditions, with tight capacity across certain segments like flatbed and reefer carriers, particularly in Florida and along U.S. coastlines affected by Hurricane Milton. The holiday season’s increased demand is also causing higher warehouse prices as retailers scramble for storage space. 
  • Overall Freight volumes in November were down 5.2% year-over-year. While some routes saw rate reductions, East Coast routes experienced a temporary rate increase due to potential labor strikes.

Ocean Freight Market Update

Rate Trends and Capacity Adjustments

Ocean freight rates on major trade routes displayed continued volatility throughout November. 

Increased capacity from additional loaders and alternative routing strategies, such as using the Cape of Good Hope, helped balance some capacity shortfalls. 

Despite added capacity, disruptions caused by the looming East Coast port strikes and labor disputes created temporary spikes in rates, particularly on the U.S.-Europe and U.S.-Asia routes. 

Market-Specific Insights

North Europe and Meditterranean: Rates declined further as peak season demand subsided and shipping lines competed aggressively on these routes. 

Asia-U.S. West Coast: Rates remained mixed due to competitive pressures and a focus on repositioning equipment to meet holiday season demand. 

South America: Capacity shortages led to a temporary increase in spot rates, exacerbated by delays at major Brazilian and Chilean ports. 

Environmental and Compliance Developments

Implementation of stricter IMO 2024 environmental regulations prompted some carriers to upgrade fleet technologies. However, the associated costs are expected to reflect in long-term freight rates. 

Congestion and Reliability

Global schedule reliability improved marginally, reaching 60%, but challenges such as port congestion and vessel delays persisted. Carriers responded with better planning and adjusted port rotations, but the improvements have not yet significantly alleviated supply chain disruptions. 

Air Freight Updates

Peak Season Performance

The holiday shopping season drove an uptick in air freight demand, especially for ecommerce and consumer electronics shipments. However, the following challenges influenced market dynamics: 

Capacity Constraints: Limited aircraft availability due to maintenance backlogs and crew shortages led to tighter capacity. 

Rate Increases: Global spot rates surged to $2.71 per kilogram, with some high-demand routes experiencing double-digit percentage rate hikes. 

Ecommerce Growth: Cross-border ecommerce shipments accounted for a larger share of air cargo volumes, with North America and Europe being key markets. 

Region-Specific Developments

Asia-Pacific: Strong demand for electronics shipments pushed rates higher, particularly on trand-Pacific lanes. 

Europe: Airlines faced capacity shortages due to increased demand for automotive and high-value industrial parts, contributing to regional rate increases. 

Disruptions and Delays

Weather Events: Hurricane Milton disrupted air cargo operations, causing shipment delays and congestion at key airports in Florida. 

Geopolitical Tensions: Conflicts in the Middle East disrupted air freight routes, forcing carriers to reroute flights, leading to extended transit times and increased costs. 

Technological Advancements

Airlines continued to adopt advanced cargo tracking systems, offering better visibility and improved service levels for high-priority shipments. 

Some carriers tested drones for last-mile deliveries in remote areas, showcasing future possibilities for e-commerce logistics. 

Freight Market and Amazon News

Amazon’s Air Freight Expansion

Amazon has been aggressively expanding its air cargo network, adding to new routes and increasing its fleet of dedicated aircraft, allowing Amazon to offer faster delivery times and increased capacity to third-party sellers.

Source: https://www.freightwaves.com/news/amazon-airline-sells-excess-cargo-capacity-to-third-party-shippers

Alibaba’s New Singles Day Focus

Alibaba’s annual Singles’ Day shopping event saw record-breaking sales, demonstrating strong consumer demand in China, highlightingthe importance of e-commerce, and the impact it has on global logistics and supply chain operations.

Source:https://www.scmp.com/tech/big-tech/article/3282703/alibabas-new-singles-day-focus-protecting-sellers-price-wars

Amazon AI Delivery Technology

Amazon is deploying AI-Powered delivery vans that use computer vision to streamline package identification and delivery, improving efficiency and reducing delivery times.

Source: https://www.supplychaindive.com/news/amazon-ai-delivery-technology-vapr/730138/

Forceget Supply Chain Provider is a leading NVOCC licensed global logistics company that specializes in parcel, air and ocean shipping. With offices in key locations such as the USA, China, Hong Kong, Turkey, Israel and Colombia, we are well-positioned to assist you with all your logistics and brokerage needs, no matter where you are located. We take care of all the complexities of international shipping, allowing you to focus on what you do best – competing in your local market. Additionally, we pride ourselves on being the number one Amazon FBA focused freight forwarder, ensuring that your products are delivered to Amazon warehouses in a timely and cost-effective manner. With Forceget, you can have peace of mind knowing that your global logistics needs are in expert hands.

Logistics Market Update October 2024

Monthly Highlights

East Coast Port Strike: What to Know

A potential strike by dockworkers on the US East and Gulf Coasts loomed large in September, creating concern throughout October. While a three-day strike did ovvur, a temporary agreement has been reached, pushing back further action until January 2024. This provides some short term relief but leaves uncertainty for the future.

Source: https://www.cbsnews.com/news/east-coast-port-strike-what-to-know/

Milton Threatens Ripple Effects Across Global Supply Chains

Hurricane Milton made landfall in Florida in early October, causing significant disruptions to supply chains in the region. Port Tampa Bay closures led to congestion at alternate ports, with dwell times increasing by 25%. Damage to Florida’s citrus industry is estimated to result in crop losses of 30% and price increases of 15-20%. Additionally, expect shipment delays of 3-5 days due to road closures.

Source: https://www.freightwaves.com/news/milton-threatens-ripple-effects-across-global-supply-chains

Air Cargo Demand Up Again in September but Growth Narrows

As we enter the final quarter of 2024, strong demand for both ocean and air freight persists across major markets. Airlines are adjusting demand for both ocean and airfreight persists across major markets. Airlines are adjusting schedules for the peak season, with global air cargo supply increasing by just 3% compared to last year, marking the slowest growth this year. However, the average global spot rate for air cargo has seen a significant increase, reaching $2.71 per kg in September – the fourth month in a row with double-digit growth.

Source: https://www.aircargonews.net/airlines/air-cargo-demand-up-again-in-september-but-growth-narrows/

Key Takeaways

  • The recent East and Gulf Coast port strike led to backlogs that are expected to take 3-4 weeks to clear. Shippers rerouted freight to other ports, further increasing congestion, with container dwell times rising by 15%. East Coast container linehaul rates also climbed by 8% during the strike.
  • While the Transportation Utilization Index indicates slower expansion in overall logistics activity, tight capacity remains a challenge, particularly for flatbed and reefer carriers impacted by Hurricane Milton. While the Transportation Capacity Index remained flat in October, the flatbed load-to-truck ratio increased by 54% year-over-year highlighting the demand in this segment.
  • In preparation for the holiday season, warehouse prices have surged as retailers look to secure storage space. This comes despite a 6.6% year-over-year drop in overall freight expenditures, driven by a 4% decrease in diesel prices.
  • The Transportation Utilization Index suggests weaker freight volumes, down 5.2% year-over-year. Ocean freight rates continue to fluctuate depending on the route. While some routes experienced declines due to decreased demand, East Coast routes saw a temporary increase during the strike.

Ocean Freight Market Update

  • Container freight rates on major trade routes continued to fall significantly in September 2024. This decline was initially driven by a combination of factors. The demand for container shipping services decreased on several key trade routes, leading to a surplus of capacity. The addition of extra loaders and rerouting around the Cape of Good Hope helped to increase capacity, further contributing to the decline in rates. 
  • The looming threat of a strike at US East and Gulf Coast ports continued to create uncertainty in the market. While the strike was ultimately averted after three days, the mere threat of it has a significant impact on shipping rates and supply chain operations. Shippers and carriers were forced to adjust their plans and strategies in anticipation of potential disruptions. 
  • The balance between capacity and demand remained a key factor influencing rates. While additional capacity was added through rerouting and extra loaders, strong demand on some routes contributed to fluctuations in raates. The overall trend was one of declining rates, but there were some exceptions where demand outpaced supply.  
  • With the peak season arrival window closing and capacity increasing, shipping rates to North Europe and the Mediterranean have decreased, while rates to the West Coast are showing mixed trends due to a potential strike and increased competition.

Global Schedule Reliability

Global Schedule Reliablity August 2024

Schedule reliability increased by 1.2 points monthly to 60%, in July 2024.

Air Freight Updates

  • The peak season, driven by the holiday shopping period, has led to increased demand for air freight services, resulting in higher rates and potential capacity constraints.
  • Airlines are facing challenges in securing additional capacity due to various factors, including aircraft shortages and maintenance issues, further exacerbated the capacity and contributed to higher rates.
  • Events like Hurricane Milto and geopolitical tensions in certain regions have disrupted air cargo operations, leading to delays and increased costs.
  • The consistent growth of e-commerce has lead to higher demand for air freight, especially for cross-border shipments.



Freight Market and Amazon News

Amazon’s Air Freight Expansion

Amazon has been aggressively expanding its air cargo network, adding to new routes and increasing its fleet of dedicated aircraft, allowing Amazon to offer faster delivery times and increased capacity to third-party sellers.

Source: https://www.freightwaves.com/news/amazon-airline-sells-excess-cargo-capacity-to-third-party-shippers

Alibaba’s New Singles Day Focus

Alibaba’s annual Singles’ Day shopping event saw record-breaking sales, demonstrating strong consumer demand in China, highlightingthe importance of e-commerce, and the impact it has on global logistics and supply chain operations.

Source:https://www.scmp.com/tech/big-tech/article/3282703/alibabas-new-singles-day-focus-protecting-sellers-price-wars

Amazon AI Delivery Technology

Amazon is deploying AI-Powered delivery vans that use computer vision to streamline package identification and delivery, improving efficiency and reducing delivery times.

Source: https://www.supplychaindive.com/news/amazon-ai-delivery-technology-vapr/730138/

Forceget Supply Chain Provider is a leading NVOCC licensed global logistics company that specializes in parcel, air and ocean shipping. With offices in key locations such as the USA, China, Hong Kong, Turkey, Israel and Colombia, we are well-positioned to assist you with all your logistics and brokerage needs, no matter where you are located. We take care of all the complexities of international shipping, allowing you to focus on what you do best – competing in your local market. Additionally, we pride ourselves on being the number one Amazon FBA focused freight forwarder, ensuring that your products are delivered to Amazon warehouses in a timely and cost-effective manner. With Forceget, you can have peace of mind knowing that your global logistics needs are in expert hands.

Logistics Market Update September 2024

Monthly Highlights

Market rises into Labor Day, but falls well short of Fourth of July

Tender volumes in the trusking industry increased in August, yet this rise in demand was accompanied by a slight increase in tender rejection rates, which could be a sign of carriers having more leverage in negotiations. However, the stock market only rose in the lead-up to Labor Day (first Monday of September), suggesting that this increase in demand was not as strong as the market rise seen before the Fourth of July (early July). 

Source: https://www.freightwaves.com/news/market-rises-into-labor-day-but-falls-well-short-of-fourth-of-july

Portland Terminal 6 aid “urgently” needed, report says

The Port of Portland is in urgent need of state funding to keep Portland Terminal 6, the state’s only international container terminal, operational. The terminal is currently losing money, but it is critical to the state’s economy. The port and its stakeholders have requested $35 million in capital investments and $5 million in operational funding from the state. 

Source: https://www.freightwaves.com/news/portland-terminal-6-aid-urgently-needed-report

5 new generative AI tools to accelerate seller growth and enhance the customer shopping experience

Amazon has introduced a suite of AI-powered tools designed to streamline seller operations, improve product listings, and ultimately enhance the overall customer shopping experience. Key benefits include AI-generated review highlights that provide customers with more informed purchasing decisions and the simplification of seller tasks, allowing them to allocate more resources to product innovation. 

Key Takeaways

  • The threat of a strike by dockworkers on the US East and Gulf Coasts was a major concern throughout September 2024. The potential strike could have had a significant impact on the global supply chain, yet lasted 3 days and was postponed till January, in hopes of a rectified contract. 
  • Hurricane Helene, which made landfall in Florida, caused disruptions at several ports in the region, leading to delays in cargo operations, damage to infrastructure, and potential impacts on supply chain. 
  • Air Frieght rates continued to rise in September 2024, driven by strong demand and capacity constraints. This was particularly evident as the peak season approached. Disruptions in ocean freight, such as rerouting around the Cape of Good Hope, also contributed to the increased demand for air cargo. 
  • The US government’s proposed changes to the de mnimis exemption for low-value imports could have significant implications for ecommerce retailers, particularly those operating out of China, leading to increased costs, compliance challenges, and potential disruptions in the supply chain. 

Ocean Freight Market Update

  • Container freight rates on major trade routes continued to fal significantly in September 2024.This decline was initially driven by a combination of factors. The demand for container shipping services decreased on several key trade routes, leading to a surplus of capacity. The addition of extra loaders and rerouting around the Cape of Good Hope helped to increase capacity, further contributing to the decline in rates. 
  • The looming threat of a strike at US East and Gulf Coast ports continued to create uncertainty in the market. While the strike was ultimately averted after three days, the mere threat of it has a significant impact on shipping rates and supply chain operations. Shippers and carriers were forced to adjust their plans and strategies in anticipation of potential disruptions. 
  • The balance between capacity and demand remained a key factor influencing rates. While additional capacity was added through rerouting and extra loaders, strong demand on some routes contrinubuted to fluctuations in raates. The overall trend was one of declining rates, but there were some exceptions where demand outpaced supply.  
  • With the peak season arrival window closing and capacity increasing, shipping rates to North Europe and the Mediterranean have decreased, while rates to the West Coast are showing mixed trends due to a potential strike and increased competition.

Global Schedule Reliability

Global Schedule Reliablity August 2024

Schedule reliability increased by 1.2 points monthly to 60%, in July 2024.

Air Freight Updates

  • Airlines faced challenges acquiring new aircraft, leading to limited capacity and reduced availability for air cargo shipments. Delays in aircraft maintenance and repairs further constrained capacity and increased operating costs. Airlines were forced to adjust their networks and flight schedules to cope with rising demand, which could have resulted in longer transit times and higher rates. 
  • The continued growth of ecommerce led to a surge in demand for airfreight services, as online retailers on air cargo for faster delivery times. The approach of the peak season, with major shopping events like Black Friday and Cyber Monday, further intensified demand for airfrieght. 
  • Some shippers opted to shift their shipments from ocean freight to air freight to avoid potential delays and ensure timely delivery. 
  • Volcanic eruptions in regions like Kamchatka, Russia, disrupted key flight routes and led to load reductions for airlines operating in the area. Other natural disasters, such as typhoons or hurricanes, could have also impacted air cargo operations in specific regions. 
  • The market in North China showed signs of strengthening, driven by increased demand for e-commerce shipments and other traditional air cargo products. Other regions faced challenges due to various factors: Unstable political situations in some regions could have led to disruptions in air cargo operations, and economic downturns or slowdowns in certain regions could have reduced demand for air freight services. 



Freight Market and Amazon News

Proposed Changes to De Minimis Exemption Impact Ecommerce

Amazon empowered third-party sellers by allowing them to select their preferred trucking carrier when sending LTL and truckload shipments to its US fulfillment centers. 

Source: https://www.supplychaindive.com/news/amazon-sellers-trucking-preferred-carrier/725250/

India-US Rates on Hold

Container lines are portponing and reducing planned rate hikes for India-US routes due to weakening demand and declining rates. 

Source:https://theloadstar.com/india-us-container-gris-pushed-back-as-demand-falters/

Rough Seas, Rough Claims

Weather-related cargo damage and insurance claims are on the rise as container ships take the longer route around the Cape of Good Hope to avoid congestion. 

Source: https://theloadstar.com/insurance-claims-on-the-rise-with-box-ships-forced-to-brave-cape-weather/

Forceget Supply Chain Provider is a leading NVOCC licensed global logistics company that specializes in parcel, air and ocean shipping. With offices in key locations such as the USA, China, Hong Kong, Turkey, Israel and Colombia, we are well-positioned to assist you with all your logistics and brokerage needs, no matter where you are located. We take care of all the complexities of international shipping, allowing you to focus on what you do best – competing in your local market. Additionally, we pride ourselves on being the number one Amazon FBA focused freight forwarder, ensuring that your products are delivered to Amazon warehouses in a timely and cost-effective manner. With Forceget, you can have peace of mind knowing that your global logistics needs are in expert hands.

Logistics Market Update August 2024

Logistics Market Update August-2024

Monthly Highlights

Port of Ningbo remains open, but logistics services falter due to COVID restrictions

The Port of Ningbo continues operations despite stringent COVID restrictions, which have significantly disrupted logistics services. These restrictions have led to delays, reduced capacity, and operational challenges, impacting the global supply chain and creating bottlenecks in one of China’s busiest ports.

Source: https://theloadstar.com/port-of-ningbo-open-but-logistics-services-stutter-as-covid-restrictions-bite/

Port strikes could trigger airfreight capacity crisis

Looming U.S. East and Gulf Coast port strikes threaten to expose vulnerabilities in airfreight capacity, particularly as e-commerce demand surges. Shippers are already shifting volumes to avoid disruption, but a strike could create a severe capacity crisis for airfreight, potentially leading to significant delays and logistical challenges.

Source: https://theloadstar.com/port-strikes-would-expose-airfreights-vulnerability-to-a-capacity-crisis/

Containerships face challenges navigating the Cape of Good Hope

Containerships rerouting around the Cape of Good Hope to avoid congestion are encountering numerous challenges, including rough seas and logistical hurdles. These difficulties complicate global shipping routes, adding further strain to already disrupted supply chains.

Source: https://theloadstar.com/the-challenges-for-containerships-braving-the-waters-around-the-cape/ 

Key Takeaways

  • Amazon’s third-party sellers can now select their preferred trucking carrier when sending LTL and truckload shipments to the company’s U.S. fulfilment centres, according to an Aug. 9 announcement.
  • Looming U.S. East and Gulf Coast port strikes threaten to expose vulnerabilities in airfreight capacity, particularly as e-commerce demand surges. Shippers are already shifting volumes to avoid disruption.
  • Maritime gateways handled 40% of international freight value in 2022, according to the Department of Transportation. As a result, keeping track of seaport volumes can be a good barometer for establishing years- and months-long trade trends nationwide.

Ocean Freight Market Update

  • Transpacific volumes remain strong, exceeding last year’s levels. However, the industry continues to face challenges with delays and capacity constraints, particularly on routes passing through the Cape of Good Hope. These issues are largely due to structurally blank sailings, ongoing port congestion in Asia, and adverse weather conditions. The addition of extra loaders in late July has helped to alleviate some of the pressure on these routes, though longer transit times are still expected.

  • On the Far East Westbound (FEWB) routes, demand remains robust, surpassing figures from the previous year. Persistent equipment shortages and congestion at major Asian ports, exacerbated by vessels rerouted via the Cape of Good Hope, have caused further delays. Despite these challenges, the injection of extra loaders is helping to balance the impact of smaller vessels and extended lead times, ensuring that schedule reliability is maintained as much as possible.

  • In Northern Europe, the market remains stable, with demand and prices expected to hold steady until the end of September. In contrast, the Mediterranean region is experiencing significant congestion and delays, resulting in structurally blank sailings and full vessel utilisation. This has prompted carriers to increase rates through Peak Season Surcharges (PSS), particularly as demand continues to rise​.

Global Schedule Reliability

Global Schedule Reliablity August 2024

Schedule reliability increased by 1.2 points monthly to 60%, in July 2024.

Asia

  • The shipping market in China continues to face challenges as carriers contend with ongoing tonnage shortages. Despite these constraints, additions to shipping capacity, including new sailings and the introduction of additional carriers through August

  • In East Asia, global demand for ocean freight container shipping has surged, with an 8.3% increase compared to 2023. This heightened demand continues despite substantial capacity challenges, including severe port congestion and diversions around Africa.

North America

  • The Transpacific route is seeing activity that surpasses last year’s performance. However, structurally blank sailings have emerged due to rerouting via the Cape of Good Hope (COGH) and ongoing port congestion in Asia and North America.

  • Since additional loader (XL) space was added to the transpacific trade lane, space pressure on the US West Coast (WC) has decreased, particularly in the Pacific Southwest (PSW) originating from major Chinese ports.

  • Following the addition of extra loader space (XL) to the transpacific trade lane, space stress on the US West Coast (WC), particularly in the Pacific Southwest (PSW), has been relieved, particularly from China’s major ports.

Air Freight Updates

  • Annual Growth: In August 2024, global air cargo rates and tonnages saw a 12% year-on-year increase, the highest monthly annual increase this year. Rates rose to $2.50 per kilo, 44% higher than in July 2019.

  • The North China market has started to strengthen on both FEWB and TPEB routes, driven by increased volume in e-commerce, Apple’s NPI and other traditional air cargo customers.

  • Bangladesh Market Overlook: Despite political and logistical challenges, air cargo tonnage from Bangladesh to Europe recovered in week 31, returning to the volumes observed in weeks 25-28. However, these figures remain below the levels recorded during the same period last year.

Asia

  • Annual Growth: In August 2024, global air cargo rates and tonnage experienced a significant 12% annual increase, representing the highest monthly annual growth ever recorded this year. This increase brought rates to $2.50 per kilogram, a significant 44% increase compared to the pre-pandemic benchmark in July 2019. This growth highlights the resilience and continued demand in the global air cargo market, despite the challenges faced in recent years.

  • The North China market has begun to show signs of strengthening on both Far East Westbound (FEWB) and Trans-Pacific Eastbound (TPEB) routes. This growth is being fuelled by increased volumes in e-commerce, the launch of Apple’s new product launches (NPIs) and growing demand from other traditional air cargo customers. These factors are contributing to a more solid market outlook in the region

North America

  • Capacity is sufficient and demand from both North America and Europe is stable.

  • Last month saw service disruptions due to natural disasters. Volcanic eruptions on Russia’s Kamchatka Peninsula released ash on key flight routes, leading to load reductions for airlines flying from Asia to the US and Europe.

Logistics Market Update August 2024- Avarage Wait Times Board



Freight Market and Amazon News

Amazon equips sellers with more choice on trucking providers

Amazon’s third-party sellers can now select their preferred trucking carrier when sending LTL and truckload shipments to the company’s U.S. fulfillment centers, according to an Aug. 9 announcement.

Source: https://www.supplychaindive.com/news/amazon-sellers-trucking-preferred-carrier/725250/

Amazon expands options for sellers to handle customer returns

Amazon provides sellers using Fulfillment by Amazon (FBA) with flexible options for seamlessly managing product returns.

Source: https://www.aboutamazon.com/news/small-business/amazon-return-options-sellers

US ports by volume: How maritime cargo trends are stacking up


Maritime gateways handled 40% of international freight value in 2022, according to the Department of Transportation. As a result, keeping track of seaport volumes can be a good barometer for establishing years- and months-long trade trends nationwide.

Source: https://www.supplychaindive.com/news/largest-us-ports-by-volume-month-coast-cargo-trends/693493/


Forceget Supply Chain Provider is a leading NVOCC licensed global logistics company that specializes in parcel, air and ocean shipping. With offices in key locations such as the USA, China, Hong Kong, Turkey, Israel and Colombia, we are well-positioned to assist you with all your logistics and brokerage needs, no matter where you are located. We take care of all the complexities of international shipping, allowing you to focus on what you do best – competing in your local market. Additionally, we pride ourselves on being the number one Amazon FBA focused freight forwarder, ensuring that your products are delivered to Amazon warehouses in a timely and cost-effective manner. With Forceget, you can have peace of mind knowing that your global logistics needs are in expert hands.

Logistics Market Update July 2024

Logistics Market Update July 2024- 1920x1080

Monthly Highlights

Paris Olympics will be a true test of supply chains

The 2024 Paris Olympics will impact global supply chains with increased demand and logistical challenges, while investments in infrastructure aim to enhance long-term capabilities and sustainability.

Source: https://www.freightwaves.com/news/paris-olympics-will-be-a-true-test-of-supply-chains

Container spot rates have peaked as all major trades see prices fall

Peak container freight prices have declined this week due to reduced ship utilization and increased capacity, ending a three-month period of rising rates.

Source: https://theloadstar.com/container-spot-rates-have-peaked-as-all-major-trades-see-falling-prices/

FedEx to cut domestic flight activity by 60%

FedEx plans to cut daytime flights and city destinations by up to 60% in response to losing its U.S. Postal Service contract, leading to significant pay cuts for pilots.

Source: https://www.freightwaves.com/news/fedex-to-cut-domestic-flight-activity-by-60 

Key Takeaways

  • The 2024 Paris Olympics will be a challenge, but infrastructure investments aim to improve long-term sustainability and capabilities.
  • Amazon’s new AI chip outperforms NVIDIA’s by up to 50% in cost and efficiency, and despite Amazon’s late entry into the market, it has the potential to reshape the AI ​​technology landscape.
  • Amazon is launching a discount shopping app for low-cost Chinese products with 9-11 day shipping, aiming to compete with Temu and Shein and expand its presence in the discount retail sector.

Ocean Freight Market Update

  • Transpacific volumes remain strong, exceeding last year’s figures, but delays and capacity issues are expected from Cape of Good Hope routes due to structurally empty voyages, port congestion and adverse weather conditions.
  • Volumes on FEWB remain very strong, exceeding last year’s figures. There are structurally empty sailings due to the Cape of Good Hope routes and port congestion in Asia. However, extra loaders added in late July are helping to compensate for the smaller vessels and longer transit times.
  • Demand and prices in Northern Europe are stable and are expected to remain so until the end of September. In contrast, congestion and delays in the Mediterranean are causing empty sailings and 100% utilization, prompting carriers to raise prices through Peak Season

Global Schedule Reliability

Global Schedule Reliablity- July 2024

Schedule reliability increased by 3.8 points m-month on month to 55.8%, in May 2024.

Asia

  • Additions to shipping capacity, including new sailings and additional carriers through August, will keep the charter market tight as carriers continue to face tonnage shortages.
  • In Asia, global demand for ocean freight container shipping reached a record high, up 7.5% from 2023, despite significant capacity challenges such as severe port congestion and diversions around Africa.

North America

  • In North America, reduced capacity did not impact demand from Northern Europe, with most carriers holding steady through the end of Q3.
  • Mexico’s domestic intermodal shipments have increased by 139% year to date, accounting for 2.5% of the North American market, due to nearshore and rail investments, while Canada’s domestic intermodal shipment growth has stalled due to an unresolved labour dispute affecting major Canadian railroads.
  • Spot rates from East Asia to Europe showed mixed trends in July, with declines of 16% and 11% in Thailand and Taiwan, respectively, and increases of 7%, 5% and 3% in Hong Kong, South Korea and Japan, respectively, despite an 8% decline in Hong Kong tonnage.

Air Freight Updates

  • Global air cargo tonnage decreased by 1% in the second week of July 8-14, 2024, with declines of 5%, 2% and 5% in Europe, Asia Pacific and Africa, and increases of 6% and 4% in North America and Central and South America.
  • The average air cargo rate worldwide decreased by 1% in the first half of July to $2.50 per kilo, but remained 11% year over year and 44% above July 2019 levels, while significant increases of 23% and 51% were seen in Asia Pacific and MESA origins, respectively.
  • Global air cargo trends show a slight decrease (-1%) in paid weight flown worldwide compared to the previous two weeks, but tonnages were up 12% year-on-year in Weeks 22 and 23.

Asia

  • In the first half of July, global air cargo tonnage fell by 2% in the Asia-Pacific region, while Africa saw a 5% decline and the world saw a 1% decline.
  • Spot prices to Europe from various East Asian origins showed mixed trends in the first half of July, with declines of 16% and 11% in Thailand and Taiwan respectively, while increases of 7%, 5% and 3% were seen in Hong Kong, South Korea and Japan.

North America

  • North America saw a 6% increase in air cargo tonnage, contrasting with declines in Asia-Pacific and Europe.
  • The average worldwide air cargo rate dropped by 1% to $2.50 per kilo in first half of July, though North American rates have seen substantial increases, with notable year-on-year rises in rates from Asia-Pacific origins to the U.S.
Avarage Wait Times- July 2024


Freight Market and Amazon News

Amazon’s Latest AI Chip Promises 50% Performance Boost

Amazon has launched a new AI chip that aims to reduce costs and increase efficiency for its AWS AI cloud services, better than NVIDIA’s models by up to 50%. Despite being a late entrant into the AI ​​chip market, Amazon’s latest processors could significantly impact the competitive landscape in AI technology.

Source: https://www.trendforce.com/news/2024/07/30/news-amazon-unveiled-the-latest-ai-chip-performance-up-by-50/ 

Amazon to Launch Discount App to Rival Temu

Amazon is preparing to launch a new discount shopping app offering low-cost Chinese products with shipping times of 9 to 11 days to compete with platforms such as Temu and Shein. The move aims to expand Amazon’s reach in the discount retail sector amid increasing competition from new e-commerce players.

Source: https://www.independent.co.uk/tech/amazon-dicount-store-temu-app-b2569786.html

Amazon Hits Record Delivery Speeds for Prime Members


Amazon set a new record for Prime delivery speeds, delivering more than 5 billion items globally this year on the same or next day, a 30% increase over last year.

Source: https://www.aboutamazon.com/news/retail/amazon-prime-same-day-delivery-speed-2024 

Forceget Supply Chain Provider is a leading NVOCC licensed global logistics company that specializes in parcel, air and ocean shipping. With offices in key locations such as the USA, China, Hong Kong, Turkey, Israel and Colombia, we are well-positioned to assist you with all your logistics and brokerage needs, no matter where you are located. We take care of all the complexities of international shipping, allowing you to focus on what you do best – competing in your local market. Additionally, we pride ourselves on being the number one Amazon FBA focused freight forwarder, ensuring that your products are delivered to Amazon warehouses in a timely and cost-effective manner. With Forceget, you can have peace of mind knowing that your global logistics needs are in expert hands.

Logistics Market Update June 2024

Logistics Market Update June 2024

Monthly Highlights

Worsening containership market keeps the pressure on air cargo

The ocean shipping market’s recent challenges are driving increased demand for airfreight, particularly from Asia Pacific origins, due to capacity shortages and disruptions caused by the Red Sea crisis.

Source: https://www.aircargonews.net/business/supply-chains/worsening-containership-market-keeps-the-pressure-on-air-cargo/

Intra-Asia backhaul rates hit new heights as demand grows

Container shipping rates from China to India have surged dramatically, exerting pressure on Indian importers and disrupting schedules due to tight vessel capacity and port congestion issues across Southeast Asia.

Source: https://theloadstar.com/intra-asia-backhaul-rates-hit-new-heights-as-demand-grows/

‘At least 65 countries’ now affected as Houthi Red Sea attacks continue

Houthi attacks in the Red Sea have drastically reduced shipping activity by 90%, leading to soaring insurance costs and deterring carriers from returning soon despite naval efforts to secure the region.

Source: https://theloadstar.com/at-least-65-countries-now-affected-as-houthi-red-sea-attacks-continue/ 

Key Takeaways

  • A real rise in consumer demand could boost air cargo volumes beyond just the e-commerce sector, which is currently the primary contributor to air cargo volumes.
  • As container lines focus on the profitable Chinese trade, more regional operators are following suit. This shift has led to a surge of empty equipment outflows at Indian ports. Indian shippers were expected to face capacity issues until February.
  • Houthi attacks on Red Sea shipping have reduced box throughput by 90%. With rising insurance costs, naval support alone is unlikely to bring carriers back to the region soon.

Ocean Freight Market Update

  • Port congestion in Asia remains severe due to high yard utilization, unpredictable bad weather and vessel backlogs, resulting in low terminal efficiency and long waiting times.
  • Demand remains strong and rates per 40 ft container rose from $1,500 to $2,000 in late June. Liners expect another increase of $1,000 per 40ft container in early July.
  • Ocean freight rates for the third quarter are rising in the US cross-border export market, driven by increases in global container shipping rates.

Global Schedule Reliability

global schedule reliability june 2024

Schedule reliability is again in declline, and dropped by 5.1 percent in January 2024.

Asia

  • Despite efforts to reposition empty containers, serious equipment shortages persist at Asia’s main loading ports. Delays caused by the ship’s diversion through the Cape of Good Hope suggest that this problem will continue in the coming weeks.
  • Major trans-shipment ports for US exporters are experiencing congestion at busy destination ports in Asia and the Mediterranean.

North America

  • The federal freight policy schedule will halt during the November 2024 election, followed by intense discussions in 2025 regarding priorities for the next highway and infrastructure bill. The Infrastructure, Investment, and Jobs Act is scheduled to end in September 2026.
  • June’s General Rate Increases (GRIs) have all been implemented and additional increases are expected for all Transpacific Eastbound transit points in July due to expected high demand. Shipping lines will adjust rates more significantly for the East Coast (EC) rather than the West Coast (WC) to cope with the surge in bookings.
  • Due to operational limitations at the Port of Charleston, we are experiencing skipped sailings on Transatlantic and Transpacific routes, with some services being diverted to the Port of Savannah instead.

Air Freight Updates

  • Asia Pacific air cargo increased significantly: Tonnage and rates from the region increased by 20% and 16% year-on-year for the 22nd and 23rd weeks ended June 9, 2024, respectively. Spot rates from Vietnam to Europe rose 143% y/y to $4.47 per kilo, with tonnage up 28% y/y.
  • In the Middle East and South Asia (MESA), rates to Europe have more than doubled year-on-year in the last ten weeks, mainly driven by higher prices from India and Bangladesh. Globally, rates originating from MESA increased by 50% y/y in the 22nd and 23rd weeks. Despite decreases in rates from Europe (-16%) and North America (-11%), the worldwide average rates remained stable at $2.52 per kilo.
  • Global air cargo trends show a slight decrease (-1%) in paid weight flown worldwide compared to the previous two weeks, but tonnages were up 12% year-on-year in Weeks 22 and 23.

Asia

  • Spot rates from various Asia Pacific markets to Europe recorded notable year-on-year gains for the 23rd week running: China (+32%), Hong Kong (+18%), Malaysia (+83%), Indonesia (+46%), and Thailand (+43%). The average spot price from Asia Pacific to the US was up 51% y/y to $5.23 per kilo, while from China it was up 38% y/y to $5.30 per kilo.
  • The Asia-Pacific and Middle East and South Asia (MESA) regions saw significant year-on-year increases in chargeable weight, with Asia-Pacific up 20% and MESA up 22%. These gains were driven by strong cross-border e-commerce activity and the shift from sea freight to air freight.

North America

  • US customs will tighten scrutiny on e-commerce shipments, which could lead to congestion and increased market tensions, affecting scheduled flights and charter services.
  • Despite a 2% drop in world tonnage in mid-June, a two-week comparison reveals a 1% increase in both rates and tonnage. Routes such as Asia Pacific-US and China-US saw significant rate increases, with the notable impact of the cancellation of freighters from China to LAX.
  • According to AAPA, Asia Pacific airlines experienced strong air cargo demand in May, driven by robust regional and global trade, with international freight tonne kilometers (FTK) up 17.9% year-on-year. The average international freight load factor rose 1.4 percentage points to 61.4%, alongside a 15.1% increase in freight capacity.
port vessel waiting june 2024

Freight Market and Amazon News

Amazon Takes On Chinese Rivals Temu and Shein With Plans for New Discount Service

Amazon.com is planning to launch a new service focused on shipping affordable fashion clothing, household goods and other items directly from warehouses in China. The move comes amid increased competition from budget-friendly e-commerce platforms such as Temu and Shein.

Source: https://www.wsj.com/business/retail/amazon-plans-channel-for-low-cost-china-goods-to-fend-off-temu-shein-09eea278 

Amazon Bedrock introduces Anthropic’s Claude 3.5 Sonnet to customers

Anthropic’s latest AI model, Claude 3.5 Sonnet, is now widely accessible through Amazon Bedrock, joining the esteemed Claude family of AI models.

Source: https://www.aboutamazon.com/news/aws/amazon-bedrock-anthropic-ai-claude-3-5-sonnet

Amazon Becomes Fifth US Company To Reach $2 Trillion Market Cap


On Wednesday, Amazon became the fifth US company to reach a market capitalization of over $2 trillion. The stock closed up nearly 4% at $193.61, surpassing the $192.18 needed to maintain a market capitalization of $2 trillion.

Source: https://www.investopedia.com/amazon-usd2-trillion-market-cap-8669788 

Forceget Supply Chain Provider is a leading NVOCC licensed global logistics company that specializes in parcel, air and ocean shipping. With offices in key locations such as the USA, China, Hong Kong, Turkey, Israel and Colombia, we are well-positioned to assist you with all your logistics and brokerage needs, no matter where you are located. We take care of all the complexities of international shipping, allowing you to focus on what you do best – competing in your local market. Additionally, we pride ourselves on being the number one Amazon FBA focused freight forwarder, ensuring that your products are delivered to Amazon warehouses in a timely and cost-effective manner. With Forceget, you can have peace of mind knowing that your global logistics needs are in expert hands.

Logistics Market Update May 2024

Logistics Market Update May 2024

Monthly Highlights

Air Cargo Volumes Rise by 11% in April

Air cargo demand grew 11.1% year-on-year in April, marking the fifth consecutive month of double-digit growth, despite a 6.5% month-on-month decline.

Source: https://www.aircargonews.net/data/air-cargo-demand-rises-11-in-april/ 

Asia Pacific Cargo Maintains Momentum

Demand for consumer and intermediate goods drove a 13.7% increase in air cargo traffic in April, although available capacity expanded slightly faster, according to AAPA.

Source: https://www.aircargonews.net/airlines/asia-pacific-cargo-maintains-momentum/ 

Shippers Should Expect More Asia-Europe Blanked Sailings as Rates Rise

A sudden surge in demand and capacity reductions have caused disruption in the Asia-North Europe trade, leading to tight space and rising spot rates.

Source: https://theloadstar.com/shippers-should-expect-more-asia-europe-blanked-sailings-as-rates-rise/ 

Key Takeaways

  • Higher demand and limited capacity might cause months of very high rates and delays for shippers, although these disruptions and price increases may be less severe than the epidemic for several reasons. 
  • Asia-N. America spot rates to the West Coast are reaching $5,000/FEU, roughly their top when prices surged due to the Red Sea issue early in the year, and up over 70% from its April floor. 
  • The relentless, record-high demand caused epidemic interruptions. Demand swiftly outpaced vessel supply, overwhelming ports and causing record congestion that further limited capacity, increased delays, and raised rates.

Ocean Freight Market Update

  • Rising +9.3% YoY vs Jan’s 23, global maritime cargo demand is likely to rise still in the next months.
  • Due to the higher demand and load factors combined with equipment issues in more ports currently, carriers have announced notable rate increases on all Asia outbound corridors.
  • A fresh containership cargo propels a 9.6% annual fleet increase. Available supply is absorbed by vessel diversions and extra summer service deployments.

Global Schedule Reliability

Schedule reliability continues its upward trend.

Asia

  • Cosco started a new route out of China’s Port of Tianjin to visit multiple South America East Coast Ports, reducing transit time by 14 days. The new weekly service features 12 14K-TEU vessels from Cosco.
  • Chinese electric vehicle manufacturers are hurrying to export automobiles to Mexico and Brazil ahead of tariff hikes and other trade restrictions. The March activity will extend until June. Washington declared 100% tariffs on Chinese EVs, which are expected to be followed by other US and allied trade moves against Chinese EVs.

North America

  • Local 514 of Canada’s International Longshore and Warehouse Union (ILWU), representing over 700 workers, has postponed a strike notice during contract negotiations. However, officials continue to prepare for the West Coast strike, which would affect Port of Vancouver’s second-largest port.
  • The Pacific Merchant Shipping Association reported a decrease in dwell periods for import containers at Los Angeles and Long Beach’s San Pedro Bay ports for local truck or rail delivery. Average dwell time for truck and rail-destined containers reduced from 2.59 days in March to 2.50 days in April and from 7.02 days to 4.55 days in April.
  • Maersk has resumed AMEX and AGAS bookings in Baltimore. Transatlantic services and TP12 (Port of Baltimore exports) bookings must be reopened.

Air Freight Updates

  • Middle East crises combined with robust e-commerce demand helped YoY growth of the global air freight spot rate to turn positive for the first time since August 2022 rise +5%.
  • Based on Xeneta, the effect of “black swan” events—conflict in the Red Sea—persistent in April with volume growth reaching the fourth straight month of +11% rises in global air freight demand.
  • Apart from relieving the global air freight demand, the additional cargo capacity injected by airlines starting their summer plans helped to increase supply growth by +5% YoY in April.

Asia

  • Shippers on Asia-Europe trade routes are struggling with carriers to maintain weekly allocations because of an early peak season, port congestion in Asia, prolonged transit times in southern Africa, and equipment shortages. Carrier space allocations are becoming more flexible as demand rises.
  • First Boeing 737-800 freighter modification for ASL Airlines Australia. The jet will fly domestic and international flights, increasing the carrier’s freight network outside Eastern Australia. ASL will keep adding 737s to satisfy demand.

North America

  • Chinese import taxes increased by US President Joe Biden may harm US-China trade and costs. Levies hurt EV imports, semiconductors, and solar cells. If China responds, shippers may turn to Vietnam and Mexico, increasing pressure and diminishing volume.
  • President Biden signed the Federal Aviation Administration Reauthorization Act, allowing the GAO to investigate US air cargo operations and reduce truck delays and infrastructure inefficiencies. The FAA will get $105 billion USD over four years to improve US aviation.
  • The US Senate exempted the Boeing 767 from January 2028 carbon emissions limits. New efficiency limitations did not affect 767 freighters, extending their lifespan beyond 2028. Boeing may replace the 767 freighter to reduce emissions and energy costs drove the 3.5% YoY March 2024 CPI increase. March energy costs jumped 2.3% from February. Inflation still affects US consumer purchases and firm freight resource allocation and budgeted spend.

Freight Market and Amazon News

Walmart Responds to Amazon in the Competition for Fast Delivery

Walmart’s use of stores for same-day delivery competes well with Amazon’s fulfillment network, with both achieving significant volume in 2023.

Source: https://www.supplychaindive.com/news/walmart-amazon-same-next-day-delivery-volume/716519/ 

Amazon Drones Can Now Fly Farther and Deliver to More Customers Following FAA Approval

Prime Air receives FAA approval to expand drone delivery operations beyond visual line of sight, enhancing delivery capabilities and safety measures.

Source: https://www.aboutamazon.com/news/transportation/amazon-drone-prime-air-expanded-delivery-faa-approval

UPS & FedEx Battle Over Small Business Customers While Amazon Looms

UPS and FedEx intensify efforts to capture a larger share of small and medium-sized businesses amid market shifts, emphasizing tailored services and competitive pricing.

Source: https://www.supplychaindive.com/news/ups-fedex-small-medium-business-customer-volume/715677/ 

Forceget Supply Chain Provider is a leading NVOCC licensed global logistics company that specializes in parcel, air and ocean shipping. With offices in key locations such as the USA, China, Hong Kong, Turkey, Israel and Colombia, we are well-positioned to assist you with all your logistics and brokerage needs, no matter where you are located. We take care of all the complexities of international shipping, allowing you to focus on what you do best – competing in your local market. Additionally, we pride ourselves on being the number one Amazon FBA focused freight forwarder, ensuring that your products are delivered to Amazon warehouses in a timely and cost-effective manner. With Forceget, you can have peace of mind knowing that your global logistics needs are in expert hands.

Logistics Market Update April 2024

logistics market update april 2024

Monthly Highlights

Global Air Freight Volumes Blooming as Flower Shipments Take Off

Global air cargo rebounds, driven by flower exports, but Middle East countries still facing a post-Ramadan slowdown.

Source: https://theloadstar.com/global-airfreight-volumes-blooming-as-flower-shipments-take-off/

China’s Cargo, Container Throughputs At Ports Log Steady Growth in 2023

China’s port cargo and container throughput experienced consistent growth in 2023, with foreign trade cargo and container volumes also increasing significantly.

Source: https://www.hellenicshippingnews.com/chinas-cargo-container-throughputs-at-ports-log-steady-growth-in-2023/ 

Temu Aims to Triple Sales to $60 Billion Globally in 2024

Temu, a Chinese e-commerce platform, aims to triple its sales to $60 billion this year, rivaling Shein’s aggressive growth target of $63 billion.

Source: https://technode.com/2024/04/29/temu-aims-to-triple-sales-to-60-billion-globally-in-2024-report/ 

Key Takeaways

  • 15% of commercially important ships can pass through the Port of Baltimore both incoming and outgoing thanks to the Fort Carroll Temporary Alternate Channel.
  • The nation has opened the “Multimodal Dry Canal,” which will move goods between the Pacific and Atlantic seas via roads, railroads, port facilities, airports, and free zones in reaction to low water levels in the Panama Canal. 
  • Air freight demand rose in the first few months of 2024 as Chinese eCommerce behemoths Shein, Temu, and Alibaba transferred significant amounts of air freight out of China and Hong Kong. The discrepancy from last year has closed and shipping costs are rising as demand exceeds supply.

Ocean Freight Market Update

  • The January seven-month high in JPMorgan’s Global Composite PMI suggested possible future economic improvement.
  • The demand from Red Sea diversions and the Far East market’s revival following Lunar New Year holidays is driving down idle containerships.
  • Up to now, freight rates have decreased by -10% in March, or 21% since their peak in January. Mid-March carriers failed to raise rates, but April rises are anticipated as AP-EU futures recover by 10% to 15%.

Global Schedule Reliability

Schedule reliability continues its upward trend.

Asia

  • The worldwide container ship fleet will gain one million TEUs from South Korea’s $4 Billion USD investment. The investment intends to raise national ocean shipping corporations’ eco-friendly vessel fleet to 60% by 2030. 
  • Pacific International Lines will add weekly South American trips. On May 10 and 24, East Coast Service 1 and 2 will connect China and Singapore ports to east coast South American ports weekly.
  • Blank sailings on Asia-North Europe, Asia-North America East Coast, and Asia-Mediterranean commerce routes have decreased despite lowering spot prices. These adjustments let ship liners take advantage of high rates, but they may lower rates later.

North America

  • According to Port of Baltimore captain David O’Connell, the Fort Carroll Temporary Alternate Channel allows 15% of commercially critical ships to pass inbound and outgoing.

Air Freight Updates

  • Led by the consumer and fashion industries, the e-commerce boom propels an increase in air freight volume.
  • Trade lanes have quite different capacity growth rates, which are impacted by changes in production, e-commerce, and closures of airports.
  • Chinese airlines are granted a 45% weekly increase in flights to the US by the US Department of Transportation.

Asia

  • Air cargo demand has increased in the first few months of 2024 as Chinese eCommerce giants Shein, Temu, and Alibaba transfer substantial volumes of air goods out of China and Hong Kong. After double-digit growth in the previous two months, Xenata reported 11% year-over-year growth in March.
  • Incheon International Airport, Sharp Technics K (STK), and Israel Aerospace Industries (IAI) have begun building a passenger-to-freighter conversion facility. The facility will convert Boeing 777-300ERs and open later this year.

North America

  • Shelter and energy costs drove the 3.5% YoY March 2024 CPI increase. March energy costs jumped 2.3% from February. Inflation still affects US consumer purchases and firm freight resource allocation and budgeted spend.
  • WestJet Cargo extended Calgary-Paris flights to five weekly winter and daily summer flights. The company will deploy Boeing 787-9 Dreamliner planes to make Paris a European hub as they develop.

Freight Market and Amazon News

How Amazon is Using AI to Ensure Authentic Customer Reviews

Amazon utilizes advanced AI to detect and prevent fake reviews, ensuring a trusted shopping experience for millions of customers worldwide.

Source: https://www.aboutamazon.com/news/policy-news-views/how-ai-spots-fake-reviews-amazon 

Amazon Says More Packages are Arriving in a Day or Less After Hefty Investment in Speedy Fulfillment

Amazon is increasing the number of packages delivered to customers within one day or sooner, aiming to maintain its edge in online shopping amid rising competition.

Source: https://www.cnbc.com/2024/04/29/amazon-says-60percent-of-prime-orders-are-arriving-same-day-or-next-day.html

AWS Plans to Invest $11 Billion in Indiana, the Largest Capital Investment in the State’s History

Amazon Web Services (AWS) is investing $11 billion in Indiana, creating 1,000 jobs and marking the largest capital investment in the state’s history, with plans for new data centers and community support initiatives.

Source: https://www.aboutamazon.com/news/aws/aws-indiana-investment-11-billion

Forceget Supply Chain Provider is a leading NVOCC licensed global logistics company that specializes in parcel, air and ocean shipping. With offices in key locations such as the USA, China, Hong Kong, Turkey, Israel and Colombia, we are well-positioned to assist you with all your logistics and brokerage needs, no matter where you are located. We take care of all the complexities of international shipping, allowing you to focus on what you do best – competing in your local market. Additionally, we pride ourselves on being the number one Amazon FBA focused freight forwarder, ensuring that your products are delivered to Amazon warehouses in a timely and cost-effective manner. With Forceget, you can have peace of mind knowing that your global logistics needs are in expert hands.

logistics market update march

Monthly Highlights

Bridge Collapse Sends Exporters, Retailers Moving to Contain Business Fallout 

A bridge collapse near Baltimore disrupted trade, shut down a busy port, and forced the rerouting of shipments, impacting various industries and transportation routes.

Source: https://www.wsj.com/articles/bridge-collapse-sends-exporters-retailers-moving-to-contain-business-fallout-719734a2

How China Avoids US Tariffs

Chinese exporters utilize Mexico’s logistical advantages and U.S. tariff exemptions for sub-$800 imports to bypass tariffs, potentially fostering long-term economic benefits for the region.


Source: https://www.freightwaves.com/news/how-china-skirts-tariffs-into-the-us 

Panama Canal: Booking Slots Open Up At a Waterway On the Mend

The Panama Canal’s Miraflores Locks are beautiful, but drought has limited booking slots and draft limits, affecting shippers’ decisions. Water-saving programs have increased transportation capacity, but not pre-drought levels.

Source: https://www.supplychaindive.com/news/panama-canal-booking-slots-waterway-miraflores-locks/711251/ 

Key Takeaways

  • Powerless container vessel hit the Francis Scott Key Bridge in Baltimore, causing its collapse. According to Xeneta, a million import cartons reach the Port of Baltimore annually, which might disrupt the supply chain.
  • Heathrow Airport passport control workers decided to strike. None have been scheduled, but April 8 walkouts could impede airport travel. European airport workers struck in Frankfurt and Hamburg last month.
  • Boeing President and CEO Dave Calhoun will quit at year’s end over safety and quality difficulties. The board and management are reforming to soothe carriers and passengers and restore the airline.

Ocean Freight Market Update

  • The IMF expects the global economy to increase by 3.1% in 2024 despite the Red Sea crisis danger.
  • US inventory-to-sales ratio is falling as wholesalers reduce stockpiles. While retailers stock up.
  • Before the Lunar New Year, transpacific fares to the US West Coast were much higher than last year.

Global Schedule Reliability

Schedule reliability continues its upward trend.

Asia

  • Maersk has revealed plans to resume its Transpacific to US TP20 service. The weekly service will connect China to the US East and Gulf ports, with a launch date of April 21.

North America

  • The Francis Scott Key Bridge in Baltimore collapsed after a powerless container vessel hit it. Xeneta said a million import cartons reach the Port of Baltimore each year, which could significantly damage the supply chain.
  • Container vessel diversions to avoid Red Sea attacks can boost fuel costs by $300K USD each trip for Asia-Europe carriers. Current re-routings can add 15 days to trip time.

Air Freight Updates

  • After two months of double-digit demand growth and an increase in general freight spot rates, the global air cargo industry continued its surprising bullish start to 2024 in February.
     
  • After January’s 11% volume gain, February’s +11% YoY demand growth impressed airlines and freight forwarders.
  • After worldwide container transport volumes fell 4.0% in 2022 and climbed 0.2% in 2023, Accenture Cargo predicted them to grow 3.8% in 2024.

Asia

  • All Nippon Airways (ANA) has delayed their takeover of Nippon Cargo Airlines again. October 2023 saw the agreement pending, but July 2024 is scheduled to finalize it. Authorities are reviewing the transaction.
  • Cathay Pacific wants to reduce carbon emissions by 12% from 2019 to 2030 and reach net-zero by 2050. The strategy involves adding approximately 70 new and more efficient passenger and freighter aircraft to the carrier’s fleet.

North America

  • After many safety concerns in recent months, United Airlines may be unable to establish new routes. The FAA has banned United’s ability to certify pilots on new aircraft models and is exploring broader limitations that would limit its growth.
  • Boeing President and CEO Dave Calhoun announced he will resign at the end of the year due to safety and quality control issues. The board and management are restructuring to get the airline back on track and calm carriers and passengers.

Freight Market and Amazon News

Amazon Air Axes Smaller-Volume Routes While Boosting US Hub Flows

Amazon revamps the air network, reducing flights while increasing capacity with larger aircraft, focusing on core market hubs, amid shifts to ground transport and rising costs.

Source: https://theloadstar.com/amazon-air-axes-smaller-volume-routes-while-boosting-us-hub-flows/ 

Amazon’s Latest Brand Protection Report: How They bust Counterfeit Products

Amazon’s 2023 Brand Protection Report outlines efforts, including innovative technology and global collaboration, to combat counterfeits and ensure customer trust.

Source: https://www.aboutamazon.com/news/policy-news-views/amazon-brand-protection-report-2023-counterfeit-products

Refund Fraud Schemes Promoted on TikTok, Telegram costing Amazon & Other Retailers Billions of Dollars

Fraud ring uncovered at Chattanooga Amazon warehouse, involving employee scamming refunds in a widespread scheme, leading to lawsuits and significant financial losses for retailers.

Source: https://www.cnbc.com/2024/03/14/amazon-and-other-retailers-hit-by-refund-fraud-costing-them-billions.html 

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