+++ ALWAYS UP TO DATE WEEK 22 +++

Regular information about current developments

What is currently shaping the air freight market? What about sea freight? What about the rail connection with China? Read more.

AIR FREIGHT

Demand for exports from Europe to the USA remains at a very high level. Likewise in the opposite direction from the USA to Europe. Capacity is still scarce, the situation tense. SENATOR INTERNATIONAL is acting and will continue to act in June 2021 with additional charter flights on the "SAB" SENATOR Atlantic Bridge to compensate for some bottlenecks.

And from China to Europe? Similar picture: high demand, scarce capacity. It is true that imports of personal protective equipment (PPE) and test kits are currently on the decline. The background to this is the rising vaccination rate in Western and Central Europe. But overall demand for other goods remains high.  

Demand for exports from Europe to South Africa has also picked up strongly in recent weeks. SENATOR offers additional charter flights on the "SAB" SENATOR Africa Bridge from Frankfurt-Hahn (HHN) to Johannesburg (JNB). Relief for the market.

OCEAN FREIGHT

The overall situation remains tense. Especially in Europe, free equipment continues to be scarce. The rates? Continue to rise for June. Delays are occurring in the main ports of Hamburg and Rotterdam. 

Ships remain fully booked for export from Europe to Asia. There are no signs of a summer lull this year. As before, short-term bookings can hardly be made or only at premium rates. From June 2021, many shipping companies will increase rates again. No relief is expected before September.

Ports in Myanmar are currently not being served due to the continuing unstable political situation there. For India, Cyclone Tauktae is causing problems. Effects of the storm caused noticeable delays last week. Meanwhile, the ports of Nhava Sheva, Mundra and Hazira have resumed normal operations. At Pipavav, the terminal is expected to ramp up from June 1st, 2021.

For import from Asia to Europe, the same picture: full ships, hardly any free equipment, high rates. 

For export from Europe to North America and Mexico, volumes remain very high. High utilization will likely continue through the summer. Depending on the carrier, vessel space is available with a lead time of 4 - 6 weeks. Those who want to be safe will have to pay higher FAK (freight all kind) rates. Due to congestion at many ports in the USA and Canada, schedules are still not reliable. Direction South America also high demand. Especially for the West Coast, utilization is currently increasing, leading to further surcharges such as PSS. Bookings should definitely be placed as far in advance as possible.

A fire broke out on the 2,700 TEU vessel X-Press Pearl off the port of Colombo, Sri Lanka, on May 19th, 2021. Firefighting efforts continued over the past weekend. After the fire appeared to be brought under control late last week, it flared up again. The Sri Lanka Ports Authority (SLPA) suspects that chemicals in the containers had reacted, reigniting the fire (source: theloadstar.com).

RAIL FREIGHT

Turkey could possibly become a new hub for rail freight traffic between China and Europe. For months, well-known European railroad companies have been investing in Turkey. The country offers a lot of potential for a connection to the New Silk Road thanks to its location and recently improved railroad facilities on site. 

In 2020, the railroad company METRANS, which is wholly owned by Hamburg-based HHLA, increased the number of container trains running between Europe and China by 114%. Despite COVID-19, the provider benefited from capacity constraints in sea freight and the price advantage of rail transport. The provider's recently published balance sheet is further evidence of the extreme growth on the rail link between China and Europe (source: railfreight.com).

On the route through Poland, a construction site between Poznan and Rzepin is causing delays. Construction work is expected to take some time. Along the main arterial route, there are repeated disruptions - more frequently still in the area of the Malaszewicze border station.

CURRENT SITUATION WORLDWIDE

BRAZIL

The vaccination campaign is progressing gradually. So far, 20% of the population has been vaccinated for the first time. Due to the size of the population, it will certainly remain a longer-term challenge until herd immunity is achieved. Meanwhile, the economy has recovered slightly.

For Ocean Freight, the situation in import and export continues to be very volatile. Free space and free equipment? In short supply. Shipowners are currently sending most available capacity on the transpacific route between Asia and North America. SENATOR works closely with the network and shipowners to get cargo to its destination on time. Premium freight rates for particularly urgent cargoes are used for this purpose, among others.

For air cargo, rates have increased due to a lack of passenger flights (PAX). For the LATAM region, bookings weeks ahead are in demand. Accurate forecasts are hard to make at this time. Planning ahead is critical. SENATOR offers cheaper consolidation services for many destinations in addition to more expensive direct solutions.

CHINA 

The dramatic development of the Corona pandemic in India currently strengthens China's role for supply chains from Asia even more. Background: the current Indian corona wave has forced many smaller manufacturers to reduce production or close factories completely, at least temporarily. This complicates India's attempts to lure companies away from China as part of a global shift in supply chains (source: scmp.com).

Two major earthquakes occurred in China on May 21st, 2021. As reported by the provincial government of Yunnan in the southwest of the country, several people were killed and dozens of people were injured in the province of the same name. The extent to which the consequences of the earthquake could affect overland traffic in southern China is still unclear (source: faz.net).

MEXICO

There is currently a fuel surcharge for Air Freight from Europe to Mexico. Due to limited capacity, bookings must be made 1 - 2 weeks in advance. The "SAB" SENATOR Atlantic Bridge from Frankfurt (FRA) to Mexico City (MEX) with 3 flights per week is a good premium alternative. Flights in the LATAM region are currently hampered by restrictions and regulations related to COVID-19. For example, Argentina is in new lockdown. Currently no pax flights can be booked here.

For Ocean Freight, the situation is critical for FCL shipments. Some carriers are not accepting bookings to Mexico until the end of June 2021. Equipment is in short supply. For imports from China and Southeast Asia, rates have again increased tremendously. At least the equipment situation on the transpacific route is currently more relaxed.

SOUTH AFRICA

Effects of COVID-19-related restrictions on road freight traffic persist. Congestion and prolonged delays continue, particularly at the borders with Botswana and Zimbabwe. Several border posts were recently closed for at least 24 hours following positive Corona test cases during inspections. The additional delay continues to cause backlogs of trucks waiting to be allowed to leave South Africa. The tense situation on overland routes should be considered for bookings.

USA

Air cargo rates are up 0.5% in April 2021. Demand is picking up for both imports and exports. U.S. domestic air capacity, or available freight ton kilometers (AFTK), increased 4% year-over-year in March 2021. This was the second consecutive month of positive trend after eleven months of capacity decline.

For Ocean Freight, import demand to the U.S. and Canada remains consistently high. In April 2021, container imports were up 27% year-over-year, according to PIERS (Port Import/Export Reporting Service). Import volumes on the West Coast were up 24%, and 30% on the East Coast. Available capacity remains in short supply.

After a long period of equipment shortages driven by unavailable containers, pallet availability is now emerging as an issue. Following COVID-19-related restrictions and other factors such as the backlog caused by the Suez Canal blockade and timber shortages, there are currently not enough pallets available (source: theloadstar.com).

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