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THE OCEAN MARKET 2022
Over the past year the ocean shipping business has gone from relatively smooth sailing to front page headline news. Supply chain issues have caused major worldwide disruption, and it seems like the challenges of the past year will forever change how the industry works.
As we head into the third year of a global health crisis it is clear that this unparalleled supply chain upheaval is set to continue, with the repercussions from severe supply and demand imbalances continuing to be being felt worldwide. The availability and increasing cost of labour, freight capacity, semiconductors, empty chassis and warehouse storage space will continue to be areas of uncertainty and concern in the months ahead.
In the current circumstances it is very difficult to predict or forecast the long term implications on freight rates, but taking current factors into consideration we can only speculate that the prices will increase or at best remain the same in comparison to 2021 rates. Rest assured that if there is any improvement in rates, we will provide immediate updates. In contrast, rates on the Europe to Asia route remain stable with a slight decrease in recent weeks. As carriers require empty equipment routed to Asia, this is the ideal time to consider export freight on this particular lane.
THE PERFECT STORM OF SUPPLY CHAIN DISRUPTION
The following global supply chain trends we can see today are likely to be longer-term:
- Highly volatile Freight Rates that are hard to predict, but will continue to be high for the first part of 2022, and it could be as early as 2023 before rates stabilize.
- Congestion in all major ports which in turn has led to unpredictable transit times.
- Increase in inland transport costs caused by high fuel surcharges.
- Shortage of labour and stevedoring services at ports.
- Shortage of rail transport, hauliers and chassis in the USA and back log delays at all west coast ports of USA.
- Equipment shortages and capacity constraints as there are plenty of empty containers just waiting at ports and warehouses to be shipped back to origin, which in turn is exacerbating the equipment shortage problem.
- Government lockdowns creating supply chain disruptions.
WHEN CAN WE EXPECT TO REACH CALMER WATERS?!
On the plus side however, we do hope to see increased capacity and more frequent schedules in 2022. We forecast that the supply chain chaos will ease in the second half of 2022 due to the fact that consumers are continuing to buy and source not only from China but from alternative economies such as Turkey and other areas.
Purchase of new Infrastructure could address capacity issues and result in a decrease in Port congestions and improve overall transit times. According to reports this will not happen quickly, and we are unlikely to see any changes until the second half of 2022.
WHAT CAN ACE EXPRESS FREIGHT DO TO HELP?
Regardless of all of the above, our customers still need to move freight from A to B internationally, and they need tailored Ocean Freight solutions to help them ship their goods using the most reliable and cost effective service possible.
Our Ocean Freight team has years of experience, knowledge and expertise, which enable us to offer a very high quality service for each and every customer. We pride ourselves on listening to our customers and creating tailored solutions that meet all their needs & expectations, delivered with excellent customer care and ensuring customer satisfaction. We offer a one stop shop Ocean Freight service all the way from providing best price quotes to timely end delivery to the final destination. We provide a value-added service by keeping in regular contact with the customer and adopting a completely transparent approach. Our Ocean Team is available on ocean@ace-express.com.
Pictured below is Mary Gavin — Team Lead Ocean Department.
WISHING YOU A VERY HAPPY CHINESE NEW YEAR!
Chinese New Year is an annual occurrence that has a substantial impact on the global freight market. Production in Chinese factories is more or less put on hold during the celebration, and capacity is significantly reduced across all means of transport as all Chinese Worldwide take a well earned break!
Let us take this opportunity to wish all our Chinese friends, customers, partners and colleagues a Very Happy New Year! 新年快乐
