Air
Transpacific Eastbound: A few airlines have begun reintroducing freighter services at major hubs. A strong booking demand means spot rates remain steady and are expected to stabilize after Christmas Holiday. However, this may be short-lived, as our partners and sources are predicting the market to pick right back up with amplified demand. Rates are anticipated to continue increasing up to Lunar New Year and through Quarter 1, 2021.
Europe: Capacity and COVID related complications continue to cause challenges across the UK. We are expecting continued delays, capacity shortages, and potential rate increases as further lockdowns are implemented. Our partners in Asia are reporting high a year-over-year increase for The United Kingdom to The USA North East spot rates at upwards of 289%. Airlines will likely capitalize on these figures to increase rates where they can recuperate against the extensive revenue losses.
Americas: COVID related operational challenges linger. LAX and the West Coast continue to face the most challenging environment due to high cargo volume and labor shortages. These complications will continue affect all key hubs across the entire U.S.
Ocean
Transpacific Eastbound: Spot market pricing remains steady, while carriers continue to take advantage of this year’s unprecedented peak season. Premium pricing options are pending confirmation of additional increase on January 1st and will likely be substantial, due to overwhelming demand for pre-Chinese New Year bookings. Spot rate capacity is currently booked to the end of January / early February, with further weeks filling up quickly.
General Rate Increases (GRI): Carriers will likely be extending rates through 1/14 with the exclusion of a few carriers implementing partial GRIs. We continue to see Peak Season Surcharges being announced with the most recent being HMM announcing an “EIT” surcharge (Emergency Intermodal fee) pushed from January 1 start date to January 15.
Equipment shortages remain an industry-wide challenge for all container sizes and a major limiting factor for shipments out of Asia. Repositioning and in-fleeting will remain a focus for most carriers in January and February.
Equipment Returns and Import dwell time of containers: As we continue through the holiday weeks, import dwell continues to increase, and with volumes not expected to subside until after Chinese New Year – this is raising concerns that the cascading effect on container terminal operations could deteriorate at an accelerated pace in the coming weeks.
Blank Sailings: We expect continued port-delay-induced blank sailings into the new year. This will be further compounded by the approaching winter season which always has a deteriorating effect on schedule reliability.
The U.S. Market
Port congestion is increasing on both coasts. Port labor is observing holiday closures (Christmas, New Year’s, and Chinese New Year) which will add to the current disruption. The port of Savannah is reporting an increase in dwell of 25% or 4 days. With vessel waiting times currently between 48-96 hours and delays due to off-schedule vessels aggravated by local nautical restrictions have raised our concerns that it could take 6-8 weeks after holiday closures before improvement is seen.
In Los Angeles and Long Beach, efforts continue to maintain fluidity in the terminals as volumes remain strong and import dwells keep rising and we continue to see increased vessel waiting times. Improvement will come once volumes start to normalize and labor ganging restrictions are lifted. An increase in rail dwell was also highlighted this week due to reduced rail car availability.
Many container terminals on both coasts have extended gate hours and have made Saturday gates hours available to enable import cargo movement. Through terminals in Los Angeles, Port Elizabeth, Mobile, and South Florida Container Terminals, we are operating special gates to serve your supply chain pace and your truckers.
Vessels are experiencing extreme delays during offloading due to terminal congestion conditions. This has resulted in scheduled stops to smaller ports being skipped for vessels to return for their next voyage. Some voyages have been blanked in entirety due to vessels failing to return on time.
We continue recommending a minimum advanced booking notice 7 to 10 days before cargo ready date or arrival at port and 10 to 14 days prior for rail ramps.
Janel Group continues to closely monitor the market and port situation. Updates will be provided as they come available. To secure a booking or explore additional options for your supplier, please reach out to your Janel Group Representative.