+++ ALWAYS UP TO DATE WEEK 10 +++

Regular information about current developments

What is currently shaping the market for Air Freight? What for Ocean Freight? What on the Rail connection with China? You can read interesting facts here.

GENERAL INFORMATION  

The war in Ukraine determines our world situation. This also increasingly applies to trade routes and virtually all transport routes. Air, sea and rail freight are already significantly affected by the developments in Ukraine, the consequences of the sanctions against Russia and the closure of airspace. Due to the explosive increase in oil prices, diesel prices have also risen massively since last weekend. As a reaction, hauliers, truck forwarders and carriers are imposing special charges at short notice due to the expensive diesel.

For detailed and product-related questions, please contact your personal SENATOR contact person directly.

AIR FREIGHT 

The market has been noticeably affected by the consequences of the war in Ukraine and the accompanying sanctions imposed by Western countries. The mutual closure of airspace leads to capacity shortages due to the loss of Russian airlines (for example Air Bridge Cargo) as well as longer flight routes from Europe to the Far East and back. Supply chains are interrupted to and from Russia and Ukraine, and disrupted to and from the Far East. The Covid 19 issue continues to negatively impact the air cargo market. Now there are additional challenges.

Due to the closure of Russian airspace to European airlines, air cargo from Europe to the Far East is severely restricted. Currently, airlines are reducing their connections to and from the Far East. Japan in particular can only be reached via detours. The result: rising freight rates, which are also influenced by sharply rising crude oil prices.

Trade routes from Europe to the West are currently less affected by sanctions and their impact, although here too there are capacity problems, as Air Bridge Cargo, a provider on routes to the USA, is now out of the running.  On the "SAB" SENATOR Atlantic Bridge, capacities are limited due to reduced frequencies. This is due to routine maintenance on one of the B747-400 freighters in service. SENATOR is working on solutions to offer more connections.

In the direction of South Africa, the "SAB" SENATOR Africa Bridge continues to offer a reliable solution for shipments from Frankfurt-Hahn (HHN) to Johannesburg (JNB).

OCEAN FREIGHT  

For Ocean Freight, the market is also registering noticeable consequences of the conflict in Ukraine. All shipments to and from Belarus, Russia and Ukraine have been suspended. All the major shipping companies reported this in unison.

Following the severe storms in Northern Europe, the terminals at the Port of Hamburg continue to be overloaded. Container Terminal Altenwerder (CTA) is particularly affected. Numerous trains are waiting for days for clearance. As a result, there is a lack of equipment in hinterland traffic. Depots in Germany, Austria, Switzerland, the Czech Republic and Hungary are reporting limited container availability.

For exports from Europe to Asia, the rate situation is very tight. This applies in particular to the Middle East and India/Pakistan. At the port of Colombo (Sri Lanka), a backlog is causing delays in traffic to India. Colombo is an important hub for the subcontinent. As a result, the shipping company Hapag Lloyd has stopped accepting all bookings from northern and southern Europe to the Indian port of Visakhapatnam.

For imports from Asia to Europe, COVID-19 remains a noticeable factor. Several cities in China saw renewed increases in infection rates last week, including Qingdao, Shenzhen, and Shanghai. In Hong Kong, the situation remains particularly tense. Here, incoming shipments may be subject to delays and changes in schedules at short notice.

For exports from Europe to North America and Mexico, the situation has hardly changed recently. Congestion outside major US ports - especially on the West Coast - continues to cause delays. Rates remain at a high level. Rates are forecast to rise even further in the 2nd quarter in the direction of LATAM and Mexico.


RAIL FREIGHT

The situation in Ukraine and sanctions against Russia are hitting rail freight for China the hardest. The New Silk Road passes through Russia and Belarus. 

We hereby inform that our service SARB (SENATOR Asia Rail Bridge) is suspended for the time being due to the crisis situation. From now on no more bookings will be accepted. The current development does not allow a safe transport for shipments anymore. Also the safety of the involved employees is at stake. We ask for your understanding and will keep you informed about further developments regarding rail freight.

CURRENT SITUATION WORLDWIDE

BRAZIL

For Air Freight, the number of passenger flights has increased. The associated cargo option (PAX) has improved the capacity situation somewhat. Rates remain at a high level. The two airports Guarulhos (GRU) and Viracopos (VCP) in São Paulo continue to experience bottlenecks. These lead to long waiting times, especially for imports inbound to Brazil.

For Ocean Freight, free slots to and from Europe and South Africa remain scarce. In the direction of North America, the situation has eased somewhat. For the sea route to and from Asia, smaller freight volumes can be shipped without restrictions. Heavy cargo or larger packages, on the other hand, are problematic. Southern ports in Brazil continue to report delays, affecting supply chains.

CHINA 

As a result of Western sanctions against Russia, trade between Russia and China has increased by nearly 40%. This brings bilateral transfers to the highest growth in 12 years for the first quarter of 2022 so far. According to data released Monday by the General Administration of Customs, the growth was double the percentage increase in China's total trade over the same period (source: scmp.com).

Despite this upswing, China's overall export economy is also noticeably slowed. The consequences of the Ukraine war are hitting the world's second-largest economy in a difficult position. China's zero-covid strategy has already significantly dampened foreign trade since November. Now the government is warning of "a difficult year ahead." Chinese Premier Li Keqiang spoke of a "volatile, serious and uncertain" environment at the start of the Beijing People's Congress on Saturday. There were "many potential risks" in the economic and financial sector (source: tagesschau.de).

MEXICO

For Air Freight from Europe, the "SAB" SENATOR Atlantic Bridge from Frankfurt (FRA) to Mexico City offers a flexible and efficient solution with 3 flights per week. On the route from Asia, rates remain at a high level. 

For Ocean Freight from Europe, there are capacity constraints. Forward planning is a must. SENATOR's LCL service is a good alternative for time-critical cargo. Currently, the service has sufficient available capacity. From Asia to Mexico, the zero covid strategy continues to have an impact. In some Chinese ports, there are trip cancellations at short notice. For traffic to the U.S., SENATOR Gulf Bridge is a good option with competitive rates. 

SOUTH AFRICA 

The COVID situation in the country continues to ease. The number of new infections per day dropped below 1,000 last week. 

Prices for gasoline and diesel rose by 7.5% during the week. The cause here too: the crisis in Eastern Europe and the resulting rise in crude oil prices. In addition, the South African rand (ZAR) is currently trading weaker.

USA 

In response to the Russian war of aggression in Ukraine, the U.S. Department of Transportation and the U.S. Federal Aviation Administration have closed U.S. airspace to Russian airlines. The rule affects both passenger and cargo flights, as well as scheduled and charter flights. The rule has officially been in effect since March 2. Previously, Russia banned airlines from 36 countries (including all 27 EU member states) from flying over its territory on Feb. 28 (source: aircargonews.net).

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