ابتسم تبتسم لك الحياة: Analyst&Insight: Reasons for rising freight rates

الاثنين، 24 أغسطس 2020

Analyst&Insight: Reasons for rising freight rates

Good day dear,

Today's greeting from Leila, San Logistics. Hope you are in good healthy and all work well.

You may have noticed the continuous rising of ocean freight rates, three time as the rates of June&July.

Some of forwarders or direct customer thought it was incredible and unreasonable.

So here I will share you with the reasons analyst and throw insight of the freight rates trend in the latter semi-year 2020.

Reasons:

1. Due to the outbreak of Covid-19, most of companies/factories in Latin America were shut down/stopped production, leading to a reduction of export volume to China.

2. However, the import number of supplies for the epidemic from China rose sharply. And now after a long period quarantine, Latin American companies/factories restart their business and purchase items/materials from China in succession. Leading to a increasing of import volume from China.

3. Point 1&2 created a gap between exports and imports, resulting in lacking of containers and non-load return. The shipping lines suffered heavy losses.

4. The shipping lines decided to use small vessle to lower stowage capacity. Now due to increasing of the export number, demand of space exceed the carriers's capacity.

Combing the above points are the reasons of rising freight rates.

Insight:

1. As far as the current export commodity from China, most customers start to purchase Christmas supplies. Demand of ocean freight will remain at high level.

2. Even though shipping lines will plan to manage part of large vessels back, but the spaces will be still in heavy shortage.

3. Rates will remain at high level. It's impossible to decline to the same level as that of June& July.

So, it's important for the consignees to properly arrange their shipment schedule, give instrustion/forcase to their agents in advance when neccessary.

The above are my today's sharing, thanks so much for your attention!!!

Welcome some other comments or opinions~

Kindest Regards / saludos y gracias