In the first quarter of the year, transport and logistics capacity demand was low, while retail trade dropped 12 points below expectations. This has left the air freight markets in a fragile state. However, there is hope for air cargo as interest rates rise, prompting companies to convert their goods into cash sooner. This has led to a spike in demand for services such as invoice financing. This is a positive sign, indicating confidence across large buyers that has been missing over the past year.

Tradeshift’s index also reveals that sourcing diversification from China has led to trade activity in Vietnam growing five times faster than the global average and in Mexico six times faster. Positive signs are beginning to show, as international air freight rates edged up last week, with the Baltic air freight index rising 0.9% in the week, supported by an 18.6% rise out of London. WorldACD notes that capacity is up 12% yearly, while worldwide rates are some 37% lower, at an average of $2.56 per kg.

Our suggestions:

  • Stay updated on the rising interest rates and their impact on air cargo demand.
  • Monitor the rise in international air freight rates and assess their potential impact on your business.
  • Consider exploring new sourcing options in countries like Vietnam and Mexico with faster trade activity.


The latest Maritime Strategies International (MSI) report predicts that the major ocean trades will experience weak demand and a flood of new tonnage, leading to a decline in rates. The demand in the first quarter of 2023 has been significantly softer than the previous two years, that attributed to the Covid recovery cycle’s inventory ramp-up programs for consumer products. Spot rates are at their lowest sustainable level, with additional room for weakening contract freight rates. Drewry’s WCI composite index has declined week-on-week, indicating a 2% drop to $1,740.26 per 40 ft, down 78% on the same week last year. According to Xeneta’s XSI, the shipping industry had a difficult time in April, with long-term rates dropping by 10.6%.

All regional trade lanes registered month-on-month declines, with rates in all trades plummeting by 13.6% this year, marking the eighth consecutive month of falls. The indices for US imports saw a slight decrease of 1.5% compared to the previous month. However, as several new contracts become valid on May 1st, this small change may not reflect the actual long-term contracted reality. European imports reported their largest-ever decline, with long-term rates falling 19.5% month-on-month, while exports dropped 15.8%. Shippers are in a favorable position during negotiations due to carriers struggling with decreased demand caused by economic and geopolitical factors.

Our suggestions:

  • Prepare for a decline in rates due to weak demand and an influx of new tonnage.
  • Take advantage of favorable negotiation positions as carriers struggle with decreased demand.
  • Monitor the market closely for potential further weakening of contract freight rates.
  • Evaluate the feasibility of long-term contracts in light of the volatile market conditions.


European road transport prices have become cheaper due to increased available capacity. Transporeon’s latest data shows more excess road capacity available in the European Roamarket than a year before, with a capacity index increase of 22.7% in March 2023 compared to March 2022. The available road freight capacity on the European market decreased slightly by 0.1% compared to the previous month, likely due to seasonality.

As a result of the high increase in capacity, transport prices continue to fall, especially on the spot side. In March 2023, spot rates decreased by over 18% compared to the previous year. However, they were consistent with February 2023. In contrast, contract rates decreased by 0.4% in March 2023 compared to February 2023, yet they are 7.5% higher compared to February 2022 despite more capacity on the market.

Several small road freight businesses are currently experiencing financial difficulties due to rising operational costs and a downtrend in the spot market rates. For instance, Rhenus Logistics acquired the Croatian Trans Integral and the Deutsch Nederlandse Transport Maatschappij, while Geodis took over the French Transports DEVOLUY.

In 2023, shippers will have a more favorable freight environment with plenty of available capacity and decreasing contract and spot rates towards the end of the previous year. In the first and second quarters of 2023, procurement activity is expected to rise as shippers assess their carriers and costs in response to notable market changes and a less active economy.

In other news, The Council of the European Union has approved a new emissions trading system named ETS II for road transport. Starting in 2027, the rule will affect fuel suppliers for road transportation unless there is a significant rise in oil and gas prices. The European Parliament passed the ETS II norms last week, which the Council and Parliament had agreed on in December 2022. In most cases, ETS II will replace current national programs unless those programs have set higher prices for allowances. However, the necessary conditions, such as EU-wide charging and refueling infrastructure for a substantial transition to zero-emission heavy-duty vehicles, may not be in place in just a few years. Given the expected pace of infrastructure and technological development, the new system is more realistic.

Our suggestions:

  • Take advantage of cheaper European road transport prices due to increased available capacity.
  • Monitor the fluctuating spot and contract rates and adjust procurement strategies accordingly.
  • Be cautious of the financial difficulties faced by small road freight businesses and assess their impact on the market.
  • Stay updated on the new emissions trading system (ETS II) for road transport and its potential impact on fuel suppliers.
  • Evaluate the readiness of infrastructure and technological development for a transition to zero-emission heavy-duty vehicles.



Wiima Logistics is a provider of fourth-party logistics (4PL) services. The 4PL service provides the customer with a complete solution for supply chain management, administration and outsourcing.

4PL operations can be described as outsourcing the management and coordination of the entire supply chain – this allows the customer to focus on their core business.

Wiima staff will be more than happy to advise you in supply chain and logistics related matters. Our logistics experts and digital tools will provide you with a winning combination if you are looking for an effective and efficient logistics management setup.

We are looking forward to hearing from you!