MARKET UPDATE ON CONTAINER SHIPPING & TRANSPORT COSTS
March 15, 2022
At this moment we see no improvements with regard to the operational reality in container shipping.
We see persistent congestion at many seaports (see earlier newsletters), a backlog due to several events (covid-19 pandemic, bad weather in Northern Europe, a cyber-attack on a terminal operator, screening by customs’ authorities of containers destined for Russia), many last minute changes of sailing schedules, shortages of empty (reefer) equipment with several shipping lines, …. .
The monthly reports of Sea-Intelligence illustrate the deteriorating market situation. In the latest update on January 2022, global schedule reliability drops to a record-low of 30,9% (lowest ever).
On top of this, there’s the impact of the war in Ukraine. Oil prices have climbed to new records and push transport costs much higher.
Thus a strong upward pressure on all transport costs :
• Inland haulage
In the last days all trucking companies communicated revised fuel surcharges with immediate effect, and a few even limit the price validity to maximum one or two weeks given the lack of visibility on long term fuel prices.
There’s a high probability that shipping lines will implement so called ‘emergency bunker surcharges’ and overrule the existing rate contracts, referring to the exceptional situation due to the war.
• Therefore we advise to communicate with end-customers about this difficult market situation in logistics. Our Shipex team is always available to assist you on this.
• Secondly, we strongly recommend to refrain from long term pricing (for end-customers) taking into account the soaring transport costs and lack of visibility for the next months.
Please note that we have to apply an ‘emergency fuel surcharge’ of 40 EUR per container for loadings as from 21 March 2022 on haulage rates in Northern Europe. We will closely monitor the situation with the trucking companies, and will adjust accordingly.
• From an operational point of view, please take into account that your logistic team and customer service will be confronted with a lot of last minute modifications, changes to sailing schedules and rollovers of containers to next vessels by the shipping lines.
The Shipex team