International Maritime
The renegotiation of NVO contracts with six months left is a sign that seasonal trends are changing . Shutterstock . com retailers to frontload fall and year-end holiday merchandise this past spring . The labor threat extended to the Canadian rail industry as well .
Drought restrictions along the Panama Canal have been a factor , as are the ongoing attacks by Houthi militants on vessels transiting the Red Sea that forced most container carriers to re-route vessels around the southern tip of Africa , adding time and cost to all-water services that would have gone through the Suez Canal .
Freight rates in the eastbound trans-Pacific have been fluctuating all year . Average spot rates from North Asia to the US West Coast spiked to $ 8,133 per FEU in early July after a series of general rate increases ( GRIs ) but slid to $ 4,100 per FEU in the week of Sept . 23 , according to Platts , also part of S & P Global . The average Asia – US East Coast spot rate surged to $ 10,133 per FEU as of July 5 but has since fallen to $ 5,000 per FEU .
“ Nobody knows what the last six months of these contracts will look like .”
December should start moving two months earlier in October , said James Caradonna , executive vice president of the forwarder M & R Spedag Group . That ’ s a similar cadence to year-end holiday merchandise that began arriving at US ports in June this year rather than in August .
“ The entire 12-month cycle is shifting several months earlier ,” Caradonna told the Journal of Commerce .
“ There ’ s almost no ‘ normal ’ now ,” Shames said , noting that carriers this year began levying peak season surcharges in June rather than in August , traditionally the beginning of the peak shipping season .
Carriers are likewise optimistic about import volumes from Asia in the fourth quarter .
The trans-Pacific “ still looks pretty healthy from our perspective , between now and the end of the year ,” George Goldman , president and CEO at CMA CGM North America , told the Journal of Commerce . “ The reality is there was more cargo in the system than we all anticipated .”
Containerized US imports from Asia have grown on a year-over-year basis in each of the last 11 months , according to PIERS , a sister product of the Journal of Commerce within S & P Global . Through August , volumes have risen 18.2 % from the first eight months of 2023 and 16.1 % from the same period in pre-pandemic 2019 .
Normal cadence disrupted
The normal seasonal cadence on the Asia – North America trades has been disrupted by longshore labor , geopolitical conflicts and weather-related events dating back to last fall .
The threat of a strike by the International Longshoremen ’ s Association against maritime employers along the East and Gulf coasts was a dominant factor in forcing
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With the rates rising , carriers this year launched or reinstated 10 services from Asia to the West Coast . Liners are also running 28 single-voyage extra-loader vessels to the ports of Los Angeles and Long Beach — 14 to each port — in September and October . As a result , NVOs say they are encountering no space limitations to the West Coast . “ We ’ re getting all the space we need ,” Caradonna said . Vessel capacity to the East Coast has been tight , but since most of the holiday season merchandise was shipped from Asian load ports before Sept . 1 , NVOs said space is now opening on those all-water services .
email : bill . mongelluzzo @ spglobal . com
US imports from Asia grow for 11th straight month in August
Containerized US imports from Asia , in laden TEUs , with year-over-year change
TEU volume
1,600,000 1,400,000 1,200,000
1,000,000 |
10 % |
|
1,000,000 ,
834,286
800,000 000
|
100
0 %
|
600,000 400,000 200,000
Source : S & P Global
0 L Oct Jan 2023 Apr Jul Oct Jan 2024 Apr Aug , Jul
2024
TEU Year-over-year % change
40 % 30 % 20 %
-10 % -20 % -30 % -40 %
Year-over-year % change
© 2024 S & P Global
October 7 , 2024 | Journal of Commerce 19