+++ ALWAYS UP TO DATE WEEK 4 +++

Regular information about developments worldwide

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


AIR FREIGHT

Fundamentally, the situation remains tense due to rising Covid 19 infections from the Omikron variant. Increased staff absences worldwide are leading to more flight cancellations or delays. For the "SAB" SENATOR Atlantic Bridge self-controlled flights, continue to allow for shifts in the flight schedule. The good news is that there were no flight cancellations for any "SAB" services last week. It remains to be seen how the situation will develop.

For imports and exports to and from China, the Chinese New Year (starting February 1) is casting its shadow. As every year, capacities are in short supply and prices are rising noticeably, both for imports and exports. Experience shows that this effect takes effect about 4 weeks before and after the holidays and should be considered accordingly for all bookings. It can be assumed that the capacity situation will ease again in the course of February.

For South Africa, the "SAB" SENATOR Africa Bridge is currently operating normally with the usual frequency of 3 flights per week to Johannesburg (JNB).

The service provider FCS (Frankfurt Cargo Services) may experience slight delays in ground handling at Frankfurt Airport (FRA). The reason for this is the implemented new customs procedure for customs clearance for import shipments.

OCEAN FREIGHT  

From Europe to the Far East, the space situation on certain services has eased somewhat. This is mainly due to lower volumes to China as a result of the upcoming Chinese New Year. A major problem for European-Asian container traffic remains the ongoing congestion at major ports in Asia and Northern Europe. Towards Australia and New Zealand, on the other hand, free slots continue to be scarce.

Restrictions in some Chinese ports are causing delays. The port of Yantian is currently heavily congested. Arriving ships have to wait about a week for a berth. To ease congestion, full containers are now only allowed to be delivered by truck 4 days before ships arrive. 

For imports from Asia to Europe, many shipowners have reduced their allocations for customers. Background: long-term contracts and the prioritization of online offers. Chinese New Year further exacerbates the overall capacity constraints. China's zero covid strategy means unpredictable lockdowns and corresponding schedule changes and delays can occur at any time. Rates are stagnating at the recent high level. 

For exports from Europe to North America and Mexico, there is no relief in sight for the space situation. Demand towards the USA remains high. Ports on the US West Coast continue to be overloaded. More than 100 ships are currently waiting for berths off Los Angeles and Long Beach. So far, there are no signs of a decline in demand. Accordingly, the situation is likely to remain unchanged in the coming months. Demand for Mexico also remains enormous. Port congestion in Europe and the USA is causing delays here, too. Rates remain at a high level. There has also been little change to South America. In particular to the West Coast (SAWC), there are hardly any vacancies.

In Europe, congestion at many seaports is impacting hinterland traffic. In the last quarter of 2021, road freight rates continued to rise. The reason: demand is rising, while capacities remain scarce. Added to this is cost inflation in fuel prices. 

RAIL FREIGHT 

This week, the China National Railway Group published figures for the full year 2021. According to the figures, the volume of train traffic between Europe and China continued to grow despite the Corona crisis. In 2021, a total of 1.46 million TEU of freight was transported by train across the New Silk Road. This is 29% more than in 2020. The number of trains operating also increased again compared to the previous year, with about 15,000 (source: railfreight.com).

The SENATOR Asia Rail Bridge (SARB) continues to provide a reliable option for rail freight in both directions. The average transit time for export to China is currently 23 - 25 days. For import at about 30 - 35 days.  

CURRENT SITUATION WORLDWIDE

BRAZIL 

For Air Freight there is a lack of capacity (especially PAX) due to many passenger flights remaining on the ground. The situation on the trade routes from Europe, Asia and the USA is critical. High rates and backlogs on many airlines create challenges. For exports from Brazil, planning must be made as early as possible for all shipments.

For Ocean Freight, demand remains high on most trade routes. In Europe and Asia, rates are rising again. This is due to many congested container ports. For exports, the West Coast of South America (SAWC) and Mexico are picking up in demand. SENATOR continues to work closely with the main carriers to offer additional space on ships and keep supply chains stable.

CHINA

Yantian Port has lowered the cut-off time for outgoing containers since last week. The port is one of three main ports in the Shenzhen metropolitan area. The other two are Nansha and Dachan Bay. Shenzhen is the third largest container port in China after Shanghai and Ningbo-Zhoushan and the fourth largest in the world. This measure again demonstrates the current lack of predictability in container traffic to and from China. Due to the zero covid strategy, the upcoming Chinese New Year and the Beijing Winter Olympics, short-term changes or lockdowns are possible at any time (source: theloadstar.com).

With regard to the Beijing Winter Olympics, which will be held from February 4th to 20th, 2022, cancellations and delays must also be factored in for the Beijing area. Specifically, for truck shipments to and from Beijing:
1.    hazardous chemical shipments may not be moved by truck
2.    trucks from other provinces/cities will be diverted on the roads around Beijing
3.    for the core period of the Winter Olympics, trucks over 4 tons are banned from traveling in different directions and at different times.

For check-in and operations at Beijing Airport (PEK), the following applies:
•    The security level of the Beijing terminal has been increased from January 18 to March 16, 2022. The BGS terminal has announced that it will no longer accept cargo that must undergo 24-hour screening.

MEXICO 

Prices for Air Freight continue to rise. Rising Covid figures are causing flight cancellations or postponements in flight schedules on many connections. On the "SAB" from Frankfurt (FRA) to Mexico City (MEX), however, there are currently no restrictions.

For Ocean Freight, free seats are becoming even scarcer. Both on the transatlantic route and for imports from Asia. To the neighboring LATAM region, some services continue to operate irregularly.

SOUTH AFRICA

Car and truck traffic in South Africa must prepare for higher fuel prices in February 2022. Causes include fluctuating ROI and increased crude oil prices. 

For Air Freight, many airlines increased their rates for handling in January. The amounts vary depending on the agent and airline. According to observers, the price increases are due to the inflation rate in the country and are quite realistic. The adjustment takes effect for both imports and exports.

USA  

Online mail order company Amazon has launched daily cargo service for its own airline, Amazon Air, at Wichita Eisenhower National Airport in Kansas. This is Amazon Air's first regional airport in Kansas. Flights operate daily between Wichita and Fort Worth Alliance Airport in Texas. With the new service, Amazon hopes to expand its capacity to ship packages in central Kansas (source: aircargonews.net).

The U.S. closed its borders to unvaccinated and partially vaccinated Canadian and Mexican truckers on Saturday. This was announced by the Department of Homeland Security. With the help of the measure, the U.S. government wants to better control the Corona crisis in its own country. Before the regulation came into force, there was great resistance from the trucking industry. The impact will be felt primarily in the freight market between the U.S. and Canada, where some 160,000 truckers regularly cross the border. Approximately 75% of them hold Canadian citizenship (source: freightwaves.com).

In Ocean Freight, there are significant bottlenecks in imports from Asia to the USA. It can now take over three months to transport goods across the Pacific. This means that transit time has more than doubled compared to pre-covid. According to various sources, current developments indicate even further delays (source: freightwaves.com). 

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