Insights

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.

As a result of ocean carriers and shippers trying to utilize other gateways for discretionary cargo, capacity from China to the US West Coast has improved following the pre-Chinese New Year surge. East and Gulf Coast capacity remains tight with new booking availability pushed out into early April. Fully laden vessels arriving East Coast ports over the last several weeks have been impacting first and last mile operations in NY/NJ ports. Vessel berthing delays in Savannah continue to grow with approximately 9 vessels at anchor as of last Friday.

Heavy backlogs continue to plague air exports, especially to transatlantic destinations where freighter capacity is limited. For historically economic airline options, next available flight remains at 1-2 weeks out and many carriers are not accepting bookings unless under Priority Services. As air cargo volumes continue to outpace the return of passenger demand we expect this to be an ongoing nuisance. Luckily, the weather will be warming up and we should not have winter storms exacerbating the situation.