IMPORT: Asia to North America (TPEB)

Recent Developments:

• Major carriers implemented general rate increases (GRIs) on January 1. These increases are in play for most services from Asia to all U.S. coasts. In some cases, rates have risen as much as $1000 per 40-foot container unit.
• New surcharges have also been imposed on transits through the drought-hit Panama Canal.
• Eastbound services from Asia remain challenged as carriers indefinitely withdraw ships from transiting the Suez Canal amid rebel attacks on commercial vessels. As a result, the longer, bypass, routing around Africa will increase transit times, raise rates, and tighten capacity on weekly services.

Rates: Rates are elevated following New Year’s Day GRIs. Longer transits (avoiding the Suez) will increase shipping demand measured in ton-miles (volume multiplied by distance), a factor which can propel rates further upward.
Space: Space is generally loose but has seen some tightening amid external supply chain events.  
Capacity: Longer transits averting the canals will absorb vessel capacity in order to maintain weekly services.
Equipment: There are no outstanding equipment deficits or bottlenecks.

TIPS:

• Hold your logistics partners accountable for frequent updates regarding current market conditions and routing impacts.
• Be flexible and adaptive to alternative service options, especially as it relates to potential savings on cost or transit.
• Establish a firm timeline for future import activity as well as a vetted pool of multiple logistics providers.

IMPORT: Europe to North America (TAWB)

Recent Developments:

• The European Union’s Emissions Trading System (EU ETS) went into effect on January 1. The program requires ocean carriers to report their CO2 emissions and submit an allowance per ton of CO2 emitted.
• Ocean carriers are implementing ETS surcharges onto trade lanes to and from E.U. countries to cover these newfound costs. While these surcharges are subject to change, refer to our blog for estimates on what certain carriers will be charging.

Rates: Rates are steadily rising, however they’re not as high as they were in early December. Low demand continues to anchor levels from any drastic increases. 
Space: Space is open.
Capacity: Capacity remains in excess. However, carriers have finally taken steps to address overcapacity by reducing the size of vessels operating on transatlantic lanes. However, more aggressive measures, like blank sailings, have not been significantly deployed.
Equipment: Availability on both origin and destination sides, unless advised otherwise.

TIPS:

• Book at least three weeks prior to the ready date.
• Communicate with your logistics partners to ensure that you’re up to speed on the EU ETS program and its evolving impacts on transatlantic trade.

EXPORT: North America to Asia

Rates: Rates are low and level.
Capacity: Space remains open, particularly from West Coast ports, however exporters continue to see carriers curb their capacities via blank sailings and slow steaming as U.S. import demand remains challenged.
Equipment: Barge services in China will be temporarily suspended in early February due to this year’s Chinese New Year holiday.

TIPS:

• Insufficient communication with sailing schedules can lead to higher detention and demurrage fees as well as higher trucking and storage costs. Ensure your logistics partners are not keeping you and your cargo in the dark.