Market Review: November
The global freight market remains in flux as 2024 approaches its conclusion, with varying trends across ocean, air, and road freight sectors.
Labour disputes on the US East and Gulf coasts further add to the risk of potential disruptions, with the International Longshoremen’s Association (ILA) facing a critical deadline to reach an agreement by 15th January to avoid another port strike.
Amid these challenges, businesses must stay agile and informed to protect supply chain resilience and optimise operations. Inflationary pressures, trade imbalances, and capacity constraints underline the need for proactive planning and adaptability.
AIR
Global air freight rates rose by 2% in late November, with average spot rates surging 22% year-on-year due to strong demand from North America and Europe. Capacity shifts towards Asia Pacific reflect growing eCommerce activity, while transatlantic rates are climbing due to reduced belly capacity and a 10% drop in freighter availability.
Despite a softer-than-expected peak season, markets have demonstrated resilience, while rates from China and Hong Kong to Europe recorded steady growth.
• Spot rates up 22% year-on-year, driven by demand from North America and Europe.
• Transatlantic rates surge due to reduced passenger belly capacity.
• Asia Pacific capacity grows by 7%, supporting eCommerce shipments.
• Steady demand from China and Hong Kong bolsters global market stability.
SEA
Global sea freight spot rates continued to decline in November, with average rates now 2% lower month-on-month and at their lowest level since April. However, rates remain over 130% higher than pre-pandemic averages. In Europe, import rates dipped slightly in October, while export rates dropped 32% year-on-year, reflecting a worsening trade imbalance.
Far East export rates dropped 7.5% month-on-month but remain 27% higher than a year ago, underscoring the region’s continued influence on global market dynamics.
• Global spot rates remain 68% below pandemic peaks.
• European trade imbalance worsens, with 1.4 containers imported for every one exported.
• Far East trades continue to buoy US market, despite falling import rates.
• Softening rates may impact long-term trends, with regional variations expected.
ROAD
European road freight rates remained stable in Q3, but structural cost pressures are driving further increases. Tyre prices are rising due to new EU regulations banning non-compliant rubber imports, and fleet replenishment remains constrained, with truck registrations down 7.5% year-to-date.
New truck registrations fell by 7.5% year-to-date, limiting capacity growth and sustaining elevated costs. Many carriers are extending vehicle lifespans, with the average truck age now at 14.2 years.
• Q3 market remained stable, due to softer short-term demand.
• European truck registrations down 7.5%, limiting fleet growth.
• Rising costs for tyres, diesel, and maintenance sustain elevated rates.
• Improving consumer confidence could support rate growth.
In a rapidly evolving logistics environment, staying informed is essential to maintaining supply chain resilience. We provide actionable insights and tailored solutions to help you navigate market challenges and capitalise on opportunities.
For more information on how PSP Worldwide can support your supply chain, EMAIL Colin Redman, managing director, today.