Rates are holding at high levels as demand for space remains strong and capacity is limited by blank
sailings. We are seeing rollovers and booking delays out of most Asia origins. Vessels are booked up 3-4
weeks in advance and many services are already completely booked through July. Some carriers are
securing premium surcharges for priority loading, and some have announced peak season surcharges
beginning in July. Extra loaders have been utilized and a few previously blanked sailings have been
It’s a wait and see situation with the longer-term outlook. The current volume surge may be a
temporary bounce in response to unexpectedly strong May/June consumer demand, or it may be a sign
of gradual improvement as world economies reopen from pandemic shutdowns. Carriers took a more
restrained approach with blank sailings for Q3, electing to blank many early sailings and leave much of
the schedule for August/September unchanged for now. Volumes and forecasting over the next few
weeks will determine whether additional Q3 sailings will be canceled.
There is a lot at stake for ocean carriers. Top container shipping analysts recently revised the outlook for
2020 carrier profitability. If they can maintain rates at these higher levels, the industry stands to achieve
an annual profit in the range of $9 billion. That scenario, a significant turn from the previous outlook
dampened by the pandemic, depends heavily on carriers’ discipline with rates. As we’ve learned over
the last few years, carriers will continue to manipulate capacity, so it reflects expected demand and
higher rates are maintained.
It is imperative that all transpacific eastbound shippers place bookings at least one month prior to cargo
ready date. For all business, contract/long term and floating/short term, advance booking is required.
We urge you to proactively communicate any specific space needs to your dedicated CVI customer
service or sales representative.
Note the Dragon Boat Festival holiday will close China offices/operations from June 25-27th, and HKG
on June 25th.
Air freight space out of Asia is stabilizing as demand for PPE slows and capacity increases. Rates out of
China are closer to normal levels at this time, varying by service/lane.
Capacity remains tight in and out of Europe. Blank sailings are causing significant space issues in both
directions. Scarce equipment in Europe continues to present a challenge. Air freight space remains tight
as well, though the gradual increase of global capacity will improve the situation. Early booking and
forecasting are critical so we can plan appropriately for allocation and scheduling requirements.
Again, we urge you to proactively communicate any specific space needs to your dedicated CVI
customer service or sales representative.
Tight equipment supply and blank sailings on transpacific and transatlantic trades are causing US export
rates to creep upward. We are seeing overbooked vessels on nearly every lane. Early booking is crucial.
Air freight rates out of the US are fluid and on spot basis only. Schedules and capacity are changing
With many countries loosening pandemic-fueled restrictions, ease of shipping is improving slowly. We
are monitoring the situation. We expect to see impacts from the recent global disruption for the
remainder of the year, and possibly into next year.
Your CVI team is here to assist you through these current market challenges. Ocean freight, air
freight, domestic road/rail, and Customs Compliance – count on our dedicated professionals to care
for you and your supply chain. Call us and let us show you what we can do!
Director, Pricing & Procurement