Container Shipping Quarterly
Special Report
Carriers are expected to blank 5.4 % of Asia – USWC capacity in November , down from 11.5 % last year . Shutterstock . com
on Jan . 15 . Retailers are also concerned about a possible spike in tariffs on imports from China , depending on the outcome of the US presidential election on Nov . 5 . The frontloading of spring merchandise before an early Lunar New Year in Asia on Jan . 29 is also keeping imports strong . “ There ’ s a triple convergence of events ,” said James Caradonna , executive vice president at the forwarder M & R Spedag Group . Caradonna said some retailers are content to bring merchandise into their warehouses early and pay the storage fees rather than risk having their freight caught up in supply chain bottlenecks .
PSSs ‘ eroding ’
The combination of strong demand and the modest blank sailings from Asian load ports is keeping vessel space tight .
“ There ’ s definitely some tightening ,” said Kurt McElroy , executive vice president of the forwarder Kerry Apex . “[ Customers ] are booking two to three weeks in advance , especially from South China .”
Forwarders and carriers told the Journal of Commerce that because vessel space is likely to remain tight through November and into December , peak season surcharges ( PSSs ), which are applied to fixed-rate contracts known as named-account ( NAC ) rates , are likely to remain in play even though the eastbound trans-Pacific is technically not in the traditional peak season .
However , the $ 2,000 PSS that many forwarders have been paying since May 1 is softening .
The first carrier executive said PSSs effective Nov . 1 are in the market at about $ 1,800 per FEU , with other carriers charging $ 1,000 to $ 1,200 per FEU .
“ I think carriers are surprised at how full they were in October .”
“ We ’ ve seen erosion ,” the source said . “[ Customers ] are putting a lot of pressure on us .”
On the other hand , while some carriers are opening up more vessel space for named-account bookings , not all forwarders are getting as much of the lower-priced space as they would like , said Christian Sur , executive vice president for ocean freight contract logistics at the forwarder Unique Logistics International .
email : bill . mongelluzzo @ spglobal . com email : laura . robb @ spglobal . com
22 Journal of Commerce | November 18 , 2024 www . joc . com