Logistics Market Update June 2024

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.


  • 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.


  • 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 

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