Freight Market Update November 2023

Logistics Market Update November 2023

Monthly Highlights

Biden To Convene New Supply Chain Council To Strengthen US Logistics

President Joe Biden will convene the first meeting of his supply chain resilience council, announcing 30 actions to enhance the production and shipment of goods, address issues such as access to medicine and economic data, and aim to reduce prices for American consumers and enhance supply chain resilience for the future.

Source: https://www.maritimegateway.com/biden-to-convene-new-supply-chain-council-to-strengthen-us-logistics/

TikTok Adds Logistics to the E-Commerce Dance

TikTok integrates logistics into e-commerce. The integration shows the platform’s rising influence and impact on consumer engagement and sales through new logistics solutions. TikTok’s move into e-commerce and logistics shows how social commerce is changing supply chain dynamics.


Source: https://www.wsj.com/articles/tiktok-brings-logistics-to-the-e-commerce-dance-b43d884d

Shippers Urged to Commit to Longer-Term Air Cargo Contracts as Favorable Conditions Persist

Xeneta advises shippers to arrange longer-term contracts to take advantage of lower first-quarter airfreight prices and market stability. Xeneta’s chief airfreight officer, Niall van de Wouw, suggests forwarders switch to short-term contracts to eliminate spot market procurement and stabilize the sector.

Source: https://theloadstar.com/good-time-for-shippers-to-commit-to-longer-term-air-cargo-contracts/

Key Takeaways

  • The US GDP rose 4.9% in Q3. Third-quarter consumer spending, imports, and exports grew. Private home investment was steady and inventories grew.
  • September truckload demand rose 0.75% for the third month. In Q3, demand grew 0.4% and supply declined 0.3%.
  • September saw a broad improvement in freight demand indicators due to increases in manufacturing, real consumer spending, and wholesale sales.
  • Dry van spot prices were mostly constant and 12% lower y/y in October. As projected, linehaul rates fell 2 cents/mile from September. The normal seasonal increase is 4 cents/mile in November and 9 cents/mile in December.

Ocean Freight Market Update

  • Moderate rise in demand after the October vacations associated with Chinese Golden Week.
  • After Golden Week, a massive blank sailing campaign was put into place, which caused capacity difficulties on various outward lanes from Asia.
  • The Emission Trading System (ETS) of the European Union will go into operation on January 1, 2024, with costs estimated to be between $9 and $10 billion.



Global Schedule Reliability

Logistics Market Update November 2023

Schedule reliability continues its upward trend.

Asia

  • ONE (Ocean Network Express) launched its Thailand-Singapore Express (TSX) service to speed up Asia-Europe travel. The new service begins November 14.
  • India and the US will build Sri Lanka’s new Colombo West International Terminal. Due to Colombo Port’s large transshipments, the new terminal, which can carry 3.5 million TEUs, is needed.

North America

  • The US East Coast dockworkers’ union, the International Longshoremen’s Association (ILA), is giving serious thought to the prospect of a 2024 October strike by its members. The strike action may seriously affect supply chain operations and would extend coast to coast.

Air Freight Updates

  • The demand for air cargo is flat year over year and continues to be stable, with a little increase MoM.
  • A robust increase of +19% in belly capacity over November 22 has resulted in an increase in air cargo capacity of 11% over same month.
  • The demand for air cargo is flat year over year and continues to be stable, with a little increase MoM.

Asia

  • Asiana Airlines and Korean Air will unite. European officials’ concerns about air freight and passenger routes to and from Europe delayed the deal. The merger awaits US and Japanese clearance by the end of January. Asiana will sell its cargo division to a South Korean carrier.
  • Hong Kong International Airport operator AAHK is partnering with China’s Dongguan Port Group to build a sea-air multimodal transport terminal. The logistics park will be the first to link sea-air intermodal transshipment to airport airside environments. The facility will highly digitalize and automate facilities and equipment to reduce transshipments between the two groups’ cost and time.

North America

  • The capacity constraint at Schiphol Airport in Amsterdam affected many airlines, including JetBlue & KLM. The DOT authorized JetBlue’s lawsuit against the EU and Netherlands, stating that it breaches the IUS-EU Air Transport Agreement. JetBlue will not fly into Amsterdam for the 2024 summer season, which will affect KLM operations out of their main hub.
  • As sustainable aviation fuel (SAF) gains popularity, regions invest in its manufacturing infrastructure. Recent projections predict that North America will produce 2.4 million gallons per year by 2030, followed by Europe and Asia at 1.2 and 0.9 mmgy, respectively.
  • Southwest Airlines pledged to purchase 680 million gallons of sustainable aviation fuel. Southwest Airlines can buy SAF in 2028 from USA BioEnergy for 20 years, reducing carbon dioxide emissions by 30 million metric tons. As new production plants operate, Southwest can acquire 180 million gallons of SAF annually.

Logistics Market Update November 2023

Freight Market and Amazon News

17 Best-Selling Items on Amazon During Black Friday & Cyber Monday

Amazon announced its 2023 Black Friday and Cyber Monday best-sellers. This list shows which Amazon items sold best during various important shopping occasions, revealing consumer preferences and trends. It illustrates e-commerce’s changing landscape and holiday shoppers’ favorite products.

Source: https://www.aboutamazon.com/news/retail/amazon-best-sellers-black-friday-cyber-monday-2023

Project Kuiper to Provide Private Connectivity into AWS, Enhancing Flexibility and Data Control for Customers

Airfreight charges on important trade routes rose in November due to weather, e-commerce demand, and capacity concerns. E-commerce demand on Black Friday and Cyber Monday, capacity challenges, and poor weather all contributed to the increase, but cargo volumes are still modest and peak season demand is lower than expected.

Source: https://www.aircargonews.net/airlines/rates-continue-to-rise-in-november-despite-muted-demand/

5 Ways Amazon is Using AI to Improve Holiday Shopping & Deliver Packages Faster

Amazon uses AI throughout the customer journey, from Supply Chain Optimization Technology (SCOT) demand forecasting to a vast fleet of mobile industrial robots in fulfillment facilities. Generated AI helps optimize routes and solve last-mile delivery issues, while AI-driven robotics improve sorting, packing, and efficiency.

Source: https://www.aboutamazon.com/news/operations/amazon-uses-ai-to-improve-shopping

Forceget Digital Freight Forwarder 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.