July was marked by yet another series of disruptions, many of them natural disasters – including fires in Canada, flooding in Europe, a typhoon in China, and virus outbreaks in Vietnam and elsewhere – that put additional pressure on an industry already stretched thin. With these crises hitting just as peak season heats up, freight rates continued to climb, pushing the Freightos Baltic Global Index to a new high of $10,174/FEU, a 466% increase compared to last July.
Asia-US West Coast rates reached $18,346/FEU, more than 6x its level a year ago, and Asia-US East Coast prices climbed to an astounding $19,620/FEU, 487% higher than last July.
On the transpacific, insatiable consumer demand for imports – as peak season ordering is shifting into high gear toward its expected August peak – pushed rates up throughout the month to new record highs. Asia-US West Coast rates reached $18,346/FEU, more than 6x its level a year ago, and Asia-US East Coast prices climbed to an astounding $19,620/FEU, 487% higher than last July.
And as those volumes arrive, the US supply chain is still contending with existing backlogs. Though conditions have improved, Union Pacific’s mid-month weeklong suspension of rail bookings from West Coast ports to its Chicago hub, aimed to help clear the overwhelmed midwest terminal is a good indication that logistics are still operating at a deficit
Prices from Asia to North Europe spiked 22% since the end of June to $13,706/FEU, more than two and a half times their level at the end of 2020 and more than eight times the benchmark a year ago.
Prices from Asia to North Europe spiked 22% since the end of June to $13,706/FEU, more than two and a half times their level at the end of 2020 and more than eight times the benchmark a year ago. Growing demand over the first half of the year – estimated to be well above 2019 levels – is of course contributing to the climbing rates and congestion.
In transatlantic trade, Europe – North America East Coast prices climbed 6% to $6,013/FEU, but are more than triple their level a year ago, while Europe to South America East Coast rates spiked 56% to $3,311/FEU, approaching four times their level last year, and with nearly all of that climb taking place since February as capacity was diverted to more congested lanes.
Source: Freightos Group’s FBX, The Baltic Exchange