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Asia carriers dominant

The unexpected surge in East and Westbound demand in June combined with already tight air and ocean capacity – the container shipping alliances had already cancelled a significant number of May/June sailings to match the low demand – sent China to North Europe and UK rates spiking from the end of May, when capacity had almost been halved.

July’s import volumes continue to increase, following their rebound in June and this increase in demand means that many lines are now taking bookings two or even three weeks in advance of vessel closing.

Carriers are now in the position where they can simply refuse to take late bookings and are imposing premiums on shippers desperate to get late cargo booked.

While we continue to get all our containers lifted, we are recommending 14+ days advanced notice to guarantee bookings and to get the best available rates.

To match the increase in volumes, carriers reinstated some previously blanked sailings and have left more ships active in July compared to June, but rates still rose early this month, before settling at stable, but higher rates.

So this year’s unusual peak season appears to have begun, though projections are that volumes will stay flat through November. However, the surge in COVID-19 cases in recent weeks makes predictions difficult.

Air freight rates from China have been rising in July, as capacity was withdrawn from the market and are now levelling, though no significant reductions are expected before the return of passenger services.

We note increasing numbers of LCL bookings, indicating that importers are replenishing their inventory and possibly gearing up for peak season.

We are also experiencing increases in Sea/Air bookings as importers of time-sensitive shipments take advantage of falling rates from the Indian Subcontinent and Far East, via Singapore and Dubai.