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Ocean freight spot rates continue to decline on the Transpacific Eastbound trade, albeit at a somewhat slower pace since last month. Reductions have been more pronounced on lanes to the US West Coast, where volumes have declined considerably as labor contract negotiations drag on. Spot rates to West Coast ports are inching closer to pre-pandemic levels, and most are already below the benchmark widely assumed to represent current carrier operating costs. In contrast, volumes moving into East Coast and Gulf Coast ports remain strong, and rate levels are stronger as a result; current spot rates on these lanes are still much higher than pre-pandemic levels.

Ocean carriers began cutting Asia-US import capacity through blank sailings in the lead-up to China’s early-October Golden Week holiday. Blank sailings continue, but the slowdown of demand is outpacing the reduction of supply in the ocean freight market. Carriers injected so much capacity into the market during the import surge of the last two years that recent capacity-cutting initiatives have not made much of a dent. Asia-US ocean capacity reduction will need to be more aggressive if carriers want to achieve a better supply/demand balance, particularly in light of the overall economic outlook. US inflation remains high, interest rates are expected to continue rising, and retailers are forecasting lower demand in the coming months. Inventories are high, warehouses are still full, and aggressive discounting has already begun ahead of the holiday season.

Ocean carrier capacity control will continue to play a major role in market stability in the short and long-term. Without strategic capacity deployment, new vessel deliveries starting in 2023 will inject more capacity into a market that is already off balance.

The warehousing crunch is being felt in markets across the country, as is the continued shortage of chassis and container yard space. As expected, the demand surge of the last two years has resulted in an oversupply of empty containers in US containers yards. Many importers are experiencing challenges returning empty equipment timely. The problem is being exacerbated by blank sailing programs; fewer vessels calling US ports means fewer opportunities to load empties for return overseas.

Global vessel schedule reliability has improved in recent months as the market has softened. Terminal congestion in the US has mostly shifted from the West Coast to the East Coast, following volumes that shifted due to West Coast congestion delays and labor contract uncertainty.

The Transatlantic Westbound trade is relatively steady. Ocean rates and volumes have remained high this year. N. Europe and UK ports are still experiencing congestion and have dealt with a variety of labor delays in recent months. Inland rail congestion and very low water levels on waterways have also contributed to delays moving cargo throughout the continent. The outlook from that side is also uncertain; inflation is a major issue, as are concerns over a winter energy crisis in light of the ongoing Russia/Ukraine conflict.

In recent months, US truck capacity has improved in most markets, and air freight capacity challenges have eased on many major trade lanes as well. US export trades are relatively steady, though challenges persist. Scheduling of export shipments is still difficult due to vessel schedule changes and chassis shortages, especially via East Coast ports.


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Rachel Shames

VP, Pricing & Procurement

CV International, Inc.


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Rachel serves as Vice President, Pricing and Procurement for CVI. Her responsibilities include vendor selection, contract management and negotiation, transportation pricing, FMC compliance, and international agent network management.

Rachel began her career in international shipping with CMA-CGM America. She joined CVI in 2011, gaining experience in various departments with a focus on inside sales and marketing for the company. In 2014, Rachel assumed the role of Manager, Transportation, working on service procurement and development of client proposals. She has served in her current position since 2018.

A native of Norfolk, Virginia, Rachel earned her bachelor’s degree from the University of Michigan in 2005. She holds a Master of Business Administration with a concentration in Maritime and Supply Chain Management from Old Dominion University.

– Rachel Shames, Director, Pricing & Procurement, CVI
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