Insights

Conditions since our last update have significantly deteriorated with most import lanes fully booked at maximum capacity through April. USEC capacity has been especially hard hit since the Suez Canal debacle “poured additional fuel on the fire” as shippers had already begun to shift product to East Coast based distribution centers to avoid the lengthy delays through the Southern California gateway. Several ocean carriers have limited new East Coast booking releases this week as blank sailings will cut capacity for the next several weeks due to the ongoing global terminal congestion further hampered by the Suez related delays.

What else could possibly go wrong with today’s global supply chains? An already taxed system, fraught with delays, maxed out capacity, severe ports congestion, and a broken conveyor belt of empty containers, will now face even more delays and challenges due to the Ever Given’s extended blockage of the Suez Canal.

After three relatively soft weeks, airfreight rates have soared by more than $3.00 per kilogram out of both mainland China and Hong Kong. The same is expected for all transpacific trade lanes as vaccines, product releases, and a quarter-end push all drive demand through the roof. New covid-19 breakouts and the sustained ocean port congestion continue to add pressure on an already scarce space situation.