Southeast Asia sea freight market has started to warm up. After a year of unprecedented rate hikes and seemingly never-ending operational troubles in North Asia, Southeast Asia’s shipping market is facing the heat caused by equipment shortages and record high rates.
Market Trend
Since the outbreak of the Covid-19 pandemic in 2020, the international marine industry has witnessed uncountable ups and downs including bursts, price hikes, shortage of containers to suspensions, and tragic conditions one after another.
There is no surprise that several steamship lines have also started announcing and applying additional charges such as port congestion surcharge, peak season surcharge and shortage of containers in the face of soaring freight rates. Recently, the Southeast Asian market, which has been quiet for a long time, has also begun to stir.
According to the combination of some market freight forwarding counterparts and as well as a number of shipping companies in Southeast Asia, rate increase notices have been issued and launched. This move is an obvious sign that sea freight began to take off!
Key reason
It is reported that the cause of this surge or with the cancellation of numerous flights in Southeast Asia has been initiated by several following points for reference.
In Thailand, Southeast Asia services named TRX, CV6 were withdrawn, this makes the market space decreases by 900T; CUL withdrew a ship thus space is reduced by 500T; with PIL and RCL, two vessels often omit ports, which causes the loss of 300T, the above total 1700T.
The market originally had 5000 slots, reduced to about 3,300. Also, the port was blocked for 4 days, the original 14 days a round trip became 18 days, and the capacity was reduced by 22% to 2574 TEUS per week.
Normally, the cargo volume of the Southeast Asia market is about 3500 TEUS, and now in peak season, the volume is estimated at approximately 4K per week, gap 1400 TEUS, accounting for 36%.
Due to the rise of the ratio of cargo backlog, it is good advice for the current market shipping that regardless of how much the earliest schedule costs, as long as cargo is ready, just have them loaded because the highest price this week is the lowest price next week.
