The situation is growing even more challenging on all fronts – hard as it is to believe after the year we’ve had. We are doing everything possible to accommodate bookings, but demand continues to far outpace supply of capacity and equipment. We need to continue to communicate how exceptional the current market is.
- Challenges on TPEB lanes persist and are expected to worsen in January, ahead of Chinese New Year. Vessels are overbooked, especially to USEC and USGC destinations. Equipment is still very scarce. Out of Ho Chi Minh, even the highest-priced, super-premium services are overbooked; carriers are canceling bookings and declining new bookings due to severe lack of equipment.
- Rate premiums are climbing, pushing Asia to USEC rate levels to new record levels per container, port to port. We are already hearing that shippers are paying even more to get on vessels for January.
- Space and equipment cannot be guaranteed prior to Chinese New Year, even at the new super premium rate levels. Shippers requiring bookings before CNY need to be requesting them now, if they have not already done so; they should not wait. One month advance booking is the minimum at this point, with no guarantees.
- We expect demand to remain high after CNY, so we may see the same premium level rates stick around for some time.
- This is a truly unique, unprecedented market. Please be sure customers are aware and planning ahead with forecasting, early bookings, etc.
- Many European countries are on lockdown during the holiday period to stem the spread of COVID-19. Concerns over the new UK strain have halted cargo movement between the UK and EU, impacting US shipments transiting that route. This is causing huge delays for the current surge of volume between the UK and EU before the official transition period of Brexit ends on December 31, 2020. UK ports are still experiencing massive congestion as well.
- Carriers are announcing more equipment imbalance surcharges to address the shortages across Europe. The equipment challenges mean bookings will be very difficult to secure in Q1, especially while the holiday/lockdown backlog is cleared.
- Air freight service is still very limited globally, and services are changing frequently.
- US truck capacity remains extremely tight. Bookings must be placed with truckers 3 weeks in advance. Port congestion, rail delays, and chassis shortages are still slowing down the flow of cargo.
- Vaccine distribution in the US has had limited impact on the flow of standard freight up to this point.
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Rachel serves as Director, 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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