The freight rate increases imposed by all carriers on this trade lane from 1st July appears to have succeeded. There are good reasons for this;
- The carriers are disciplined to return to profitability, as long term periods of low rates are unsustainable.
- The rush of bookings to ship prior to the increase of 1st July, has meant that vessels were full and cargo was rolled into July, causing much of July to be at full capacity also.
- Traditional July/August peak period for moving Christmas orders has started, and has had an effect on the amount of bookings / cargo movements.
Since the 10th July, carriers have started publishing a further round of general rate increases, due to take effect from 1st August at a level of USD 500 per TEU. It is of course too early to say whether this increase will go ahead in full, part or at all, and we are unlikely to know until we have finished our negotiation towards the end of this month.
We would recommend that if you can bring your orders forward to ship in July instead of August, then to do so.
Although most vessels are full and space is tight, Global Container’s do have protected space allowances at key loading ports, so unless we exceed our weekly forecast quota, we can guarantee space going forward.
We will continue to monitor the market closely and work with our main carriers to ensure that any increases are kept to a minimum.
As usual, customer contracts will be updated with rates from 1st August as soon as they are confirmed.