Air
Trans-pacific: Airfreight service from Asia to U.S. continues to see strong demand. Janel Group Partners predict elevated rates to persist through 2021. Market makers continue to anticipate passenger flights to resume, especially as vaccinations pick up but caution against over-exuberance. Initial flights are likely to be short-haul, domestic, and leisure, which align less favorably with cargo.
Europe: Capacity out of Europe into Asia and Americas is available through freighter and dedicated passenger freighters. The situation is expected to remain unchanged through beginning of 2021. Main airports in the E.U. are fully operational and continue to see strong demand for exports.
Americas:
TPWB markets remain stable at elevated amounts into all Asia hubs. We predict further cancellations during Lunar New Year. We are closely monitoring and will advise if stricter regulations are imposed in Hong Kong.
TPEB We are seeing capacity remain available but continue to experience and hear reports of COVID related challenges lingering across major U.S. hubs. LAX and the West Coast continue to face the most challenging environment due to high volume and labor shortages. These complications will continue.
Ocean
Transpacific Eastbound: Spot market pricing remains stable as carriers extend rates through Feb 14th. However, premium service increases vary by lane and by carrier. Most space pre-CNY is booked. Earliest bookings available are for vessels departing after the holiday. Freight requiring departure before the holiday must move via airfreight. Carriers have announced more voided sailings after the holiday. Space will remain tight throughout the rest of February and into March.
General Rate Increases (GRI): Partially implemented – Most carriers (MSC, YML, Etc.) extended their rates through Feb 14 / 28. (as mentioned above, premium rates continue to rise and dictate the market with most regular bookings considered low priority.)
As reported in news publications, freight services are anticipated to be disrupted in Myanmar during its political unrest. We will monitor this situation and advise as updates come available.
Equipment shortages remain an industry-wide challenge for all container sizes and a major limiting factor for shipments out of Asia. Repositioning and in-fleeting will remain a focus for most carriers into Q1.
Equipment Returns and Import dwell time of containers: Vessels continue to sit at anchor waiting to be unloaded in the ports of LA/LB, with limited appointment slots and reduced throughput at the terminal due to COVID-19 issues. We are working around the clock to secure appointments and reduce storage, demurrage, and detention costs. That said, truckers in key U.S. ports are increasing rates to sustain capacity.
Blank Sailings: The positive news in the new year was the update on carriers’ post-Lunar New Year (Feb 12) blank sailing schedule, revealing approximately 2% of capacity will be voided following the holiday, compared with 20% a year ago.
The U.S. Market
Conditions at West and East coasts remain extremely congested, without improvement over the last two weeks.
We continue to receive updates from our local stations across the U.S. regarding the current rate increases, capacity issues, equipment shortages, etc. Below are current and critical details regarding capacity and lead time for local markets.
West Coast: Truckers are beyond capacity in LA/LB area and many are refusing new clients or loads. Most are currently booking 3-5 weeks out. Last-minute bookings are completely out of the question. Clients and carriers are looking to Oakland and other West Coast ports for relief.
South-West: Truckers are booking 3-4 weeks in advance.
Mid-West: Weather conditions becoming an issue and truckers are booking 1-3 weeks in advance, but capacity can be secured with advanced notice. Equipment shortage, and the usual issues with rail yards and ramps running behind. The biggest delays and issues are arising from WC/EC congestion, capacity, and equipment shortages.
South-East: Truckers are booking 3-5 weeks in advance with last-minute bookings and appointment requests being nearly impossible to secure, especially at normal rate levels. We expect to see additional capacity issues due to drivers pushing for more pay, some carriers have had to drop loads due to lost drivers. The situation at the ports of Savannah and Charleston remains dire and local contacts are forecasting further strain into Q1.
East Coast: Weather conditions becoming an issue and truckers are booking 2-4 weeks in advance with major impacts from the EC being equipment shortages and congestion. Containers of all sizes and chassis have become increasingly unavailable to meet deadlines and free time. As mentioned in the previous update, smaller ports that are completely overwhelmed with volume are being pulled from some vessel service loops and sailing schedules to avoid arrival delays (IE the port of Boston has been experiencing this issue with more frequency than others).