Shippers are anticipated to continue to face rising supply chain costs due to port congestion and poor schedule reliability, despite a mixed demand picture on the world’s most significant container shipping lanes. It is a mixed bag of demand for Asia-North Europe and transpacific trade routes, with the former falling by 8% while North American imports remained steady at 1%.

Despite a drop in demand, container spot rates from Asia to North Europe are expected to rise in the following weeks, as North European hub ports face chronic yard congestion and dockers’ strike threats. Freight rates from Asia to Europe remained practically constant on the week due to “steady supply and demand fundamentals in the industry.”

The FBX, WCI, and XSI indices gave North Europe costs of $10,693, $9,798, and $10,415 per 40 ft, respectively, despite carriers not demanding premium equipment costs or assured shipment at this time.

The critical North European container hub ports have become overburdened with yard density figures of 80 percent to 90 percent, leading to an 8% drop in European imports in April. However, this week’s “warning strikes” by dockers at north German container ports, as well as the threat of more industrial action at those ports and other North European hubs as unions try to force through wage increases, do not go well for the supply chain for the upcoming peak season.


The air freight industry continues to lose altitude in the face of an overall economic slowdown and supply chain disruptions. It’s unclear whether rapidly changing conditions will allow airlines’ cargo operations to return to positive territory this summer.

The global economy is expected to increase moderately in 2022, but the chances of a slump next year, which might restrict cross-border commerce, are growing. As the Ukraine war, large-scale COVID lockdowns in China, surging inflation, and high-interest rates hindered global output and spending, air freight volumes fell 7% in May compared to 2021, repeating April’s decline.

Air cargo demand was also 8% lower in May 2019 than before the outbreak. Meanwhile, available capacity grew 4% from the previous year, but it is still 12% below what it was in 2019. As a result of the shift in supply and demand, aircraft utilization declined significantly, with the average load factor dropping 9 points to 60%.

The North Atlantic market has seen some of the most significant changes, with passenger airlines quickly reintroducing passenger services for the summer season in response to fewer travel restrictions and robust bookings. The rapid expansion of widebody aircraft that can transport people and cargo has resulted in a significant increase in capacity in a short time. May capacity was 82% higher than in 2021, up from 44% in March.

Load factors in the Europe-North America trade route have dropped to 64% from 82% in March over the last eight weeks. The dynamic load factor — the amount of cubic capacity occupied by freight — was also 22 points lower in May than a year ago, compared to only 7 points in March. For the first time in two years, rates from Europe to North America experienced negative year-over-year growth in the last week of May.


After nearly two years of decline, transportation capacity increased for the second month in May. During the month, overall supply chain activity remained steady.

The subindex for transportation capacity increased by 7.8 points to 64.7. That was the fastest growth rate since October 2019, as the logistics industry continues to trend back to the mean after nearly two years of high growth.

However, the capacity issue has been divided by carrier size. The foundations of small carriers that rely on load boards for freight have deteriorated as rising costs, particularly fuel, have met decreased spot rates. On the other hand, large fleets continue to enjoy contractual rate increases, and many management teams say they could use more drivers and equipment.


China-Europe trade is in high demand. Since Russia invaded Ukraine, train freight has fallen, yet some European clients are “bypassing sanctions” by employing Chinese agents.

According to Chinese media, Silk Road rail volumes grew to 350,000 teu on 3,630 train trips in the first quarter, up 9% and 7% yearly, respectively. Forwarders have seen a different reality on the ground, with estimated rail traffic down by 80% from pre-war levels.

Demand had “significantly decreased,” owing in part to Russian restrictions. Manufacturing and haulage have been harmed due to the lockdowns in Shanghai and other Chinese cities, resulting in reduced rail export volumes.



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