What’s happening with Far East Freight to Mediterranean Trade?
According to the Shangai Container Index, container Freight rate in 2021 surged by 250% TO 350% from Far East main ports to the Mediterranean when compared to 2019…
Why?
It’s supply Vs Demand factor:
Asia was the first hit, but the first continent to recuperate from the pandemic, which means that countries like china are working with full capacity to produce and export again. On the other hand, the rest of the world is struggling with the effects of the pandemic, with most of the countries still on lock down or preventive measures. Recently, weather conditions across North America and Europe added more difficulties in the maritime industry too.
This situation created a huge demand for products and containers shipping from the Far East to the USA, North Europe and the Mediterranean.
In the mean time,shipping companies had fewer vessels deployed on their schedules and containers scattered all accross the world. It caused a shortage of cargo and vessels availability besides the rise in freight rates.
Although Freight Rates in 2021 surged this much, most carriers are still dealing with space issues, with containers being released to shippers 2 to 3 weeks after booking confirmation. In normal circumstances. a carrier releases containers to the shipper within 24hours. To add insults to injury, space on cargo vessels is very tight, and shipping companies are struggling to add additional sailing boats on these routes.
What will happen?
We expect the market to stabilize by the third quarter, but we do not expect the rates to go down to the levels of 2019.
What are we doing?
Only feasible freights rate and shipments is being accepted from the shipping lines. Several Carriers are promising cheaper freight rates but no space. We are using our experience and expertise to find an optimum balance for our customers. To sum up, a combination of a decent freight rate with space on the vessel.
What should you do?
Contact us for a free consultation today at sales@oands.com.mt or call
+35623971100 . Visit our website at www.oands.com.mt
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