The ongoing blockade in Shanghai – as well as China’s Labor Day, which closed many factories across the country in the first half of this week – continued to keep exports limited, according to Freightos cargo market. Meanwhile, the number of Covid cases has increased in Beijing and other cities, increasing the possibility of additional blockades.
Government figures released this week show that production levels in April were at their lowest levels since the initial epidemic in 2020, and that freight volumes across the country fell 15 percent from last April. .
Some ocean carriers announced additional discontinued voyages for late May and June, including to the east coast of the United States, but instead attributed them to increasing delays and congestion instead of responding to declining demand.
Meanwhile, Robert Khachatryan, CEO of Freight Right Forwarder, said that – for freight forwarders – trans-Pacific “capacity has improved dramatically. We have no problem finding and booking a place from Asia to the United States. “
As demand fell and space became available, ocean prices continued to fall this week. In addition, many of the additional capacity charges have been removed in the last few weeks. As a result, US-West Coast interest rates fell 19% to $ 12,596 / FEU – their lowest level since July – and Asia-Northern Europe. Prices fell 3% to $ 10,565 / FEU, their lowest point since June.
Despite significant flight cancellations in Shanghai, air fares have also fallen due to declining demand. The Freightos Air Index Shanghai-Northern Europe has fallen 38 percent since the end of March to $ 7.37 / kg, although that percentage is more than three times the pre-pandemic rate at this time of year.
The continuing lull in ocean volumes will be a welcome opportunity for ports of destination to clear some of the existing backlogs. But the longer the blockade lasts, the greater and more worrying will be the impending container frenzy for these already congested ports.
- As the blockade in Shanghai continues and worries about closures elsewhere increase, government figures released this week show that production levels in April were at their lowest levels since early 2020 and that cargo volumes in the whole country decreased by 15 percent compared to last April.
- As demand falls and space becomes available, ocean tariffs continued to fall this week, with percentages for Asia – the US West Coast falling 19 percent to $ 12,596 / FEU – their lowest level since July – and percentages in Asia – Northern Europe fell 3 percent to $ 10,565 / FEU, its lowest point since June. This was also partly due to the elimination of many of the premiums that became common during peak capacity shortages.
- Prices on the Asian-American West Coast (FBX01 Daily) fell 19 percent to $ 12,596 / FEU. This percentage is 104 percent higher than the same period last year.
- Prices on the east coast of Asia and the United States (FBX03 Daily) fell 7 percent to $ 15,973 / FEU and are 144 percent higher than last week.