Freight Rate Update: August 2020
Ronald Vincent | M.E. Dey & Co.
Here is the latest update on current freight rates for both Import and Export cargo. M.E. Dey provides the best possible rates available to our clients by reviewing various carrier options. We will keep you advised and informed as trade updates are announced.
Air Freight – Rates from Asia to the U.S. did decrease in the first half of July and space was not as tight as it was in previous months. Starting in the third week of July we have seen rates increase again as some carriers have canceled flights due to maintenance requirements and traditional summer scheduling. Demand for air freight space remains strong so it is a bit puzzling why carriers are canceling freight flights for reasons other than required maintenance.
Aircraft are available for charter flights. We continue to work with our partners to arrange charter flights. We have upcoming charter flights from China to Chicago and other U.S. destinations.
We continue to move air freight shipments daily. In most cases, we need to make bookings 3-7 days in advance.
Space from Europe is less of an issue and rates continue to decrease. Import volumes from Europe have decreased over that past 2-3 weeks.
Please contact us with shipment details. We can then provide standard options/pricing as well as propose creative solutions that may meet your service requirements while also reducing additional costs.
Trans Atlantic Westbound (import)
- Import volumes from Europe have declined over the past 2-3 weeks. For the first time in months, rates have declined a bit as demand has weakened and excess capacity has popped up.
Trans Atlantic Eastbound (export)
- Rates remain stable. Equipment availability has improved and we are not currently seeing any major delays. We encourage customers to book at least a week in advance.
Trans Pacific Westbound (export)
- We have seen some rate reductions in the past week as carriers seem to be looking for export cargo. Equipment availability has not been an issue. We encourage customers to book at least a week in advance.
Trans Pacific Eastbound (import)
In July we continued to see steamship lines push through significant rate increases and/or peak season surcharges. By the end of the month, some of the increases eroded, but overall rates are higher at the end of July.
Most carriers have announced GRIs to take effect on August 1st and August 15th.
Space has remained tight from most origins and some rolling of cargo is occurring. Space from Vietnam and Cambodia is particularly tight.
For August, the forecast is that steamship lines will not cancel or blank as many sailings and that additional ‘loaders’ will be scheduled on some routes. With additional capacity coming online there is some optimism that rates have peaked. However, the steamship lines are intent on matching capacity with the demand to maintain current rate levels.
We are seeing the effect of the ‘extra loaders’ carriers scheduled in July. Over the past 2 weeks west coast ports, particularly Prince Rupert and Los Angeles/Long Beach have experienced a surge in import volumes. This has resulted in longer dwell times, the number of days it takes for containers to load onto the rail once they discharge from the vessel, at Prince Rupert, and chassis shortages at Los Angeles/Long Beach terminals.
I spoke with the staff at the Prince Rupert terminal. They advised that the average dwell time the past 2 weeks has been 5-6 days. The standard they are trying to achieve is 2-3 days. They expect that it will take another 2 weeks to clear up the congestion and have dwell times in the 2-4 day range.
We are also concerned about rail capacity from Los Angeles/Long Beach. There has been a surge in domestic rail volume from Southern California to the Midwest and East Coast destinations. The surge has created congestion at rail ramps in the LA region. As a result, UP and BNSF have implemented capacity restrictions. At the moment it doesn’t appear this is affecting import intermodal container traffic, but we are concerned that it might if domestic volume continues to surge.
We continue to monitor capacity and port congestion levels to adjust routings for the best possible service.