+++ ALWAYS UP TO DATE WEEK 32 +++

Regular information on current developments

What is currently shaping the market for air freight? What for sea freight? What's happening on the rail link with China? You can read interesting facts here.

GENERAL INFORMATION 

The war in Ukraine, high energy costs and concerns about a possible escalation over Taiwan are keeping the market on edge. The situation remains challenging for all modes of transport.

SENATOR continues to be affected by fluctuating prices in line with market developments. Depending on the case, this may mean surcharges for certain shipments. Please note: For detailed and product-related questions, please contact your personal SENATOR contact person directly. 

AIR FREIGHT

At Frankfurt / Main Airport (FRA), the ground handling situation has recently improved somewhat. Lufthansa Cargo, among others, emphasized a weakening of the chaotic conditions compared to the beginning of July (source: theloadstar.com). Nevertheless, the situation remains complex. Due to the vacation season, there are still noticeable staff shortages, also for truck pre- and on-carriage as well as for warehouse staff. Accordingly, delays via FRA should be taken into account as a precaution.

At Frankfurt-Hahn (HHN), fuel shortages may continue to occur for individual flights. As a consequence, flight schedule deviations on our "SAB" from HHN are possible. SENATOR has solutions ready: if necessary, flights will be diverted to Liège Airport (LGG).

Jet fuel prices have recently been trending downward. It is not yet possible to make a reliable forecast about the further development of prices.

On the "SAB" SENATOR Atlantic Bridge to the USA, several major projects are currently ensuring high capacity utilization. Thanks to additional capacities, smooth operations are possible. Since August 1, the A330-F aircraft from MAS Air has been in operation for our service to Mexico. Well prepared: Three flights a week from Frankfurt (FRA) to Greenville-Spartanburg (GSP) and from there on to Mexico City (MEX) ensure sufficient capacity before the start of the high season.

OCEAN FREIGHT

After a brief reversal of the trend, spot rates for container traffic continue to fall. The decline in demand in Europe resulting from the war in Ukraine, inflation risks and rising energy costs is currently dampening sea freight traffic from Asia westbound. The situation is different in transpacific traffic: demand in the USA has recently picked up again somewhat, and capacity utilization is at a high level. Nevertheless, spot rates from Asia to the US West Coast continue to fall. It remains to be seen which direction this development will take during Q3 (source: theloadstar.com).

To prevent the spread of the Marbled Murrelet Bug (BMSB), seasonal export fumigation will begin again for shipments to Australia and New Zealand. All shipments must be fumigated upon departure from Germany beginning Sept. 1, 2022, through April 30, 2023. 

An 8-day strike has been announced at the British port of Felixstowe. From August 21st, around 1,900 employees will be on strike. Significant delays in shipments via the UK are to be expected. The port handles 48% of UK container imports. Please keep this in mind for all affected shipments (source: www.dvz.de).

For exports from Europe to Asia, the situation remains similar to the last. Despite a strike break at German seaports that has now lasted longer, there are delays in processing in phases. The same applies to imports from Asia to Europe. Rates continue to fall. More waiting time than normal should be planned for handling import containers at German ports - especially Hamburg.

For exports from Europe to North America and Mexico, there has also been little change in recent weeks. In some cases, there are delays in departures. Free seats continue to be scarce. At the same time, almost all major U.S. ports are reporting noticeable congestion with corresponding waiting times. U.S. East Coast ports are feeling a shift from congested West Coast ports. Currently, four of the top ten container terminals on the East Coast are experiencing extended wait times. These are terminals in New York and Elizabeth (also part of the Port of New York), as well as Garden City and Savannah Terminals (both Port of Savannah) (source: container-news.com). 

RAIL FREIGHT

As a result of the war situation in Ukraine, our SARB (SENATOR Asia Rail Bridge) service has been temporarily suspended. No bookings are accepted at the moment. We ask for your understanding and will keep you informed about further developments regarding rail freight.

A new service is now operating between the Chinese province of Zhejiang and Venlo in the Netherlands. The freight trains start in Jinhua. Han Zhou, co-founder of HIGO Ltd, 
points out that starting this month, there will be two regular trips per month. The new service is expected to help boost trade in textile goods from China to the Netherlands. The service will run for 18 days (source: railfreight.com).

BRAZIL

By air, the return of more passenger planes with cargo option (PAX) provides more capacity, especially from Europe. In Brazil, some airports remain congested. This also and still affects Guarulhos (GRU) and Viracopos (VCP) in São Paulo. Early inquiries should be made for all shipments.

For ocean freight, rates in transatlantic traffic remain at a high level. Free slots are rare in some cases. Here, too, early planning is the key.

CHINA

Taiwan warns against passing through the critical points in the Taiwan Strait. The military maneuvers of the Chinese army carried out after the visit of the US Speaker of the House of Representatives Nancy Pelosi also affect container traffic. Many ships in the Taiwan Strait have been forced to make evasive maneuvers from their originally planned route. They have been largely diverted to the east side of the island since the crisis began (source: splash247.com).

China's exports are growing faster than expected. Despite lockdowns and the real estate crisis, foreign trade achieved a significant increase - especially in the direction of Russia. Exports rose 18% last month compared to the same month last year. The overall trade surplus rose to a record high (source: scmp.com).

MEXICO

For airfreight, prices to and from China have recently dropped somewhat. Regular flights to Shanghai (PVG) are possible again. From and to Europe, the space situation has improved. However, due to fuel prices, rates remain at a high level.

For ocean freight there are good LCL options. From and to Asia, direct services from Shanghai and Hong Kong are currently available. From Europe, capacities for LCL services to Veracruz and Altamira have now been further expanded. 

SOUTH AFRICA

The national power utility, Eskom, is struggling to maintain power supply due to an unstable grid. Last week, there were power outages lasting 2 hours each on some days. The operator continues to work on adequate solutions.

The strike at the financial services provider SA Revenue Services (SARS) has now officially ended. However, the wage issue remains unresolved. Unions and the government are still far from a negotiated solution. Workers expect the government to present a better offer this week, otherwise they threaten to resume strike action.

Fuel prices in South Africa have been slightly reduced since August 3. This coincides with the slight decline in oil prices globally and the slight increase in the ZAR. Based on current data, a further reduction is expected later this month.

USA 

Members of the US Congress have introduced a new Freight Rail Shipping Fair Market Act. Having already implemented the OSRA 2022 shipping reform law in the spring, politicians are now turning their attention to rail freight transport. Specifically, the motion is about improving working conditions in the rail industry. According to unions, providers are hopelessly understaffed. Shifts of more than 12 hours are currently not uncommon, they say. The new law should "hold the freight rail industry accountable for its appalling service to shippers" and help workers' families, who are being hit harder by inflation (source: theloadstar.com).

Backlogs of container ship traffic off U.S. ports have increased significantly again. A total of 153 ships were on hold off North American ports last week. This was 66% more than at the beginning of June. The situation off Los Angeles and Long Beach has gradually improved. However, with ships moving to the East and Gulf coasts, congestion has shifted rather than dissipated. Due to the wider dispersion of waiting vessels across multiple ports, the situation is currently attracting less media attention than in early summer, when 90% of the backlog affected the West Coast (source: freightwaves.com).

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