<![CDATA[ China logistics still struggling with COVID ]]> Shipping, air freight and possibly some supply chains threatened with renewed crisis as China plunges back into emergency anti-COVID measures. Thomas Cullen, Chief Analyst at Ti Insights, reports.

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Shipping, air freight and possibly some supply chains threatened with renewed crisis as China plunges back into emergency anti-COVID measures. Thomas Cullen, Chief Analyst at Ti Insights, reports.

So far, the implications for ports and airports appear not to be too serious, although why this is the case in not clear, as many major cities and regions are in some form of emergency measures. Ominously, the city of Shenzhen has issued a “work from home” order despite the wider region appearing to relax measures in the face of public disturbances.

Chinese state media reports that the neighbouring port of Guangzhou, “has seen a limited impact on logistics and trade so far thanks to the local government’s launch of dynamic epidemic control measures to bring down the possible impact of the outbreak and quick reining of the virus.”

Ports further up the coast also seem to be unaffected. For example, the city of Dalian relaxed measures at the end of last week.

However, the city of Shanghai, which is the location for China’s largest container port, has just embarked on a further round of restrictions, with mass testing, business closures and movement restrictions. In the past such measures have led to serious disruption at both ports and airports, with truck-traffic in particular unable to drive through the city.

Similar measures are reported to be being applied in Chengdu and Wuhan, with both production and logistics activities being disrupted. Wuhan is a significant river port on the Yangtse and a key feeder location for Shanghai. Last week saw unrest in Zhengzhou in response to the imposition of new measures, with the most high-profile disturbances at the large Foxconn production and logistics hub in the city.

The situation is all the more febrile due to the political implications. The central Chinese government has attempted to articulate a change in policy over COVID measures, emphasising a shift away from sweeping quarantine policies. However, it does not seem that these new policies are being applied on the ground. There has been extensive public unrest in reaction to these measures.

Judging by the little emerging from China, it seems that much of the regional and national government is keen to keep production and logistics operations continuing. However, it is unclear how successful they will be in the face of other parts of the state that seem wedded to a more extreme response.

The immediate implications for air and sea freight do not yet seem to be at the level of seriousness seen in 2021, when a number of major ports in regions such as the Pearl River Delta and Shanghai reduced operations to a minimum. What the present situation implies is that sea and air freight will recover at a slower rate than had been assumed. In particular it would appear that markets such as aircraft belly freight will remain short of volume.

Author: Thomas Cullen Source: Ti Insights


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<![CDATA[ M&A in the e-commerce logistics landscape ]]> Incumbent logistics players have been making mergers and acquisitions to improve their e-commerce offerings in a growing market.

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With the boom in e-commerce post-pandemic, incumbent logistics players have been making mergers and acquisitions to improve their e-commerce offerings in a growing market.

Some of UPS’ most recent acquisitions are predominantly focused on strengthening UPS’ e-commerce last-mile services. For example, in May 2022 UPS acquired last-mile technology provider Delivery Solutions, a software-as-a-service delivery orchestration platform which enables retail omnichannel delivery options. According to UPS, Delivery Solutions’ leading technology helps merchants offer their customers more flexibility and an engaging online purchasing experience as they increasingly look for an experience-driven omnichannel strategy.

UPS also acquired Roadie, a technology platform that enables local same-day delivery with operations throughout the U.S., in 2021. Roadie often provides service for shipments not compatible with the UPS network because of their size and perishable nature, and often because they are in shopping bags without the packaging required to move through the UPS system.  The Roadie technology platform is purpose-built to connect merchants and consumers with contract drivers to enable efficient and scalable same-day local delivery services nationwide.

Similarly, DHL Supply Chain has set out to improve and scale its e-commerce fulfilment services through several acquisitions. In 2022, DHL acquired a majority stake in Monta, as well as a minority stake in Link Commerce.

DHL’s minority acquisition of Link Commerce expanded the company’s reach into Africa. Link Commerce offers a white-label solution for doing online-sales in emerging markets. Retailers can plug into the company’s e-commerce platform to create a web-based storefront that manages payments and logistics.  Through the acquisition, DHL hopes to build a broader client base globally using a business built in Africa. Sellers can also use the Link Commerce platform to create a web-based storefront that manages payments and logistics. This is particularly valuable to sellers looking to sell to African consumers as Link Commerce will handle the payment hurdles in the region, allowing US and UK sellers to grow and scale. In 2019, Link Commerce brought more than 200 US and US sellers online to African consumers in 34 countries. Link Commerce now functions for DHL under its e-commerce platform DHL Africa eShop.

Furthermore, DHL’s majority acquisition of Monta was intended to create a partnership to serve small and mid-sized webshops in e-fulfillment and online sales. Monta, located in Netherlands, has a workforce of 1,000 people and 14 fulfilment locations. At the time of its initial announcement of partnership with DHL, Monta served 1,500 SME e-sellers through a range of software-enabled fulfilment services and warehouse management software. Through this acquisition, DHL looks to widen its customer base to include more SMEs by utilising both Monta’s e-fulfilment capabilities and DHL’s existing international logistics infrastructure.

Overall, incumbents have been throwing money into acquisitions to gain market share of a rapid growing e-commerce vertical, but there are questions around whether this will continue into 2023.

There have been conflicting reports regarding whether M&A activity in the logistics sector has been slowing during 2022. According to BDO M&A activity in the UK, the largest e-commerce logistics market in Europe, significantly slowed in Q3 2022 as companies assessed the impact of the war and soaring inflation. Several sector bankers have also cautioned that logistics M&A is slowing significantly in the North America region. This has also seen reduced funding for e-commerce start-up companies, which incumbents often look at acquiring.

As the global economy enters a pronounced slowdown and inflation rises at historic rates, it remains to be seen whether M&A activity in this market will continue at the same pace as the beginning of the pandemic.

Source: Transport Intelligence, November 29, 2022

Author: Michael Sinclair

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<![CDATA[ Volatile air freight rates and market uncertainty ]]> The air freight market is as volatile as ever. Some of the trends that are obscured include the buoyancy of semiconductor demand earlier on in the year combined with the collapse in health-care related cargoes. The movements in these sectors has been violent, both up and down. Yet it is still the US consumer that smooths everything out of the top-line trends.

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The air freight market is as volatile as ever. Some of the trends that are obscured include the buoyancy of semiconductor demand earlier on in the year combined with the collapse in health-care related cargoes. The movements in these sectors has been violent, both up and down. Yet it is still the US consumer that smooths everything out of the top-line trends.

Being focused on the expedited shipping of consumer goods and electronics production supply, the rates are invariably tied to consumer demand in backhauls of trading routes. 

The profile of inventory in the retail sector appears different to that in the US, with a smaller boom leading to lower levels of stock. Equally the reduction in internet retail activity has had less impact as many economies have poorly developed internet retail sector. Additionally, air freight plays a smaller part in the support of the consumer economy compared to the US, or indeed China.

Proportionately, production operations account for a higher proportion of most European economies air freight traffic than consumer demand. Some of these areas are healthy, such as health care which is significant: out of German, Swiss and the UK. Also, areas such as hi-tech precision engineering. The recovery in automotive production will also provide support.

This is a strong signal that air freight rates will be under downward pressure in Q4 2022 to at least Q1 2023, and very probably following quarters.

Ti’s Q4 Air Freight Tracker provides an outlook on the Air Freight market heading into the new year.

 

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<![CDATA[ US rail investment continues despite strike threat ]]> The issue of strikes by rail workers continues, with the SMART union stating that it was setting a deadline of the 8th December for the rail companies to put forward an acceptable deal, otherwise it would call a strike for the 9th of December.

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The problems of the US rail system rumble on.Ti Insight’s Chief Analyst Thomas Cullen reports.

The issue of strikes by rail workers continues, with the SMART union stating that it was setting a deadline of the 8th December for the rail companies to put forward an acceptable deal, otherwise it would call a strike for the 9th of December.

However, the seriousness of the situation seems to have reduced with the acceptance of the existing offer by the train conductor’s union. Rail strikes are still possible in December but probably not likely.

However, investment in the US rail sector also continues. The latest is Norfolk Southern’s purchase of Cincinnati Southern Railways for US$1.6bn. This seems quite a high price for a local rail network of 337miles and 10,000 acres of land, yet it improves access for Norfolk Southern to one of the most dynamic areas for logistics services in the US, not least due to the exposure to the growing container port complexes in the southern states.

The Cincinnati Southern network terminates at Chattanooga on the border of Georgia. CEO of Norfolk Southern, Alan Shaw, explained that “the Cincinnati Southern Railway is a critical artery linking the Midwest and the Southeast and plays an important role in our powerful network that serves more than half the U.S. population…. This agreement sets the framework for Norfolk Southern to own a core line in our network in perpetuity.”

Norfolk Southern has been leasing much of the infrastructure of Cincinnati Southern for a number of years through its New Orleans and Texas Pacific Railway subsidiary. Cincinnati Southern has been owned by the City of Cincinnati since its establishment in the nineteenth century. Norfolk Southern have made a number of offers for the assets of the railway to the Cincinnati City council but they have been rejected. However, a number of politicians said that the $1.6bn cash bid was too good to refuse.

Author: Thomas Cullen

Source: Ti Insights


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<![CDATA[ Maersk steps up net zero push with methanol production ]]> Maersk recently announced a strategic partnership with US-based project developer Carbon Sink LLC to develop green methanol production facilities in the US.

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A.P. Moller – Maersk recently announced a strategic partnership with US-based project developer Carbon Sink LLC to develop green methanol production facilities in the US, starting with a 100,000 tonne per year. Maersk intends to purchase the full volume of green methanol produced at the plant, with options for the output of subsequent facilities at other locations. This was Maersk’s eighth green-methanol agreement aimed at ramping up production of green methanol.

In July 2021, Maersk ordered the world’s first container vessel fuelled by carbon neutral methanol, which will be deployed on the Baltic shipping route in 2023. In total, the company has 19 carbon-neutral container ships on order which can either run on fossil fuels or a low-carbon fuel called green methanol, and which are set to be delivered in 2024.

These investments are part of Maersk’s broader ambition to become net zero by 2040. Purchasing these vessels is a key step towards meeting the target, but sourcing alternative fuels at scale presents its own set of challenges.

Maersk needs approximately 6m tonnes of methanol per year to reach its 2030 target for fleet emissions target (a 50% reduction in emissions per transported container in the Maersk Ocean fleet and a 70% reduction in absolute emissions from fully controlled terminals) and even larger amounts to reach net zero by 2040.

The 19 vessels fuelled by carbon neutral methanol will require approximately 750,000 tonnes of green methanol. The eight green-methanol agreements the company has signed so far should secure the volumes needed to meet the demands of these vessels. However, to make a meaningful difference to its carbon footprint Maersk will need more vessels and hence more methanol.

Meanwhile, other shipping lines are pursuing a similar path to decarbonisation. In January this year, the Japanese shipping giant NYK Group took delivery of a 600ft methanol carrier equipped with dual-fuel engine technology which enables it to be powered by methanol or conventional marine fuel. CMA CGM also announced recently the purchase of six methanol-powered ships.

Presently, there isn’t much production of green methanol because there aren’t many shipping lines running methanol-powered vessels. Maersk strategy to simultaneously purchase carbon-neutral vessels and sign partnerships for the production of methanol certainly sends a demand signal in the market to scale up methanol production.

Another development that is likely to increase demand for alternative fuels is regulation. For instance, the EU FuelEU Maritime Regulation, part of the proposed Fit for 55 package, sets targets for vessels to reduce their greenhouse emissions over the coming decades. The regulation is expected to come into effect in 2025. This type of regulations sends a clear signal to shipping lines that they need to continue investing in carbon-neutral ships. It also sends a signal to alternative fuel producers that demand for this type of fuels will be guaranteed moving forward.

Supply chain strategists can use GSCiTi’s online data platform – to identify opportunities for growth, support strategic decisions, help them stay abreast of industry trends and development, as well as understand future impacts on the industry. 

Visit GSCi subscription to sign up today or contact: Michael Clover for a free demonstration: mclover@ti-insight.com | +44 (0) 1666 519907 

Source: Transport Intelligence, November 24th, 2022

Author: Viki Keckarovska

 

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<![CDATA[ CH Robinson sees markets on the turn ]]> Further confirmation from C.H. Robinson that freight markets – to quote the company’s CEO Bob Biesterfield – “are entering a time of slower economic growth where freight markets will continue to cool from their peaks and will operate more reliably and at more normalised rates, with fewer disruptions”.

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Ti Insights chief analyst Thomas Cullen reflects on C.H Robinson’s results and the wider logistics market.

Further confirmation from C.H. Robinson that freight markets – to quote the company’s CEO Bob Biesterfield – “are entering a time of slower economic growth where freight markets will continue to cool from their peaks and will operate more reliably and at more normalised rates, with fewer disruptions”.

C.H. Robinson’s results for the Third Quarter of 2022 were not terrible, with revenues down just 4% and operating profits down 7.5% year-on-year. Yet this contrasts with the results for the past nine months, where revenue is up 18.2% and operating profits are 38.8% higher. Still the implication strongly suggests that the markets have turned for the Minnesota based forwarder.

The problem is in air and sea forwarding. The business units in sea freight saw a 25.5% fall in gross profit, whilst air freight forwarding saw a 21% fall. In comparison, sea and air forwarding have seen gross profit for the previous nine months grow by 21.6% and 4% respectively.

There is also a contrast between sea and air forwarding and C.H. Robinson’s US road freight operations, with full truck-load and less-than-truck load seeing a 19.6% and 22.4% rise in gross profit in Q3. Judging by C.H. Robinson’s numbers, US road freight seems to be reacting less violently to any logistics market downturn.

Yet the level of growth is still lower, with the ‘North American Surface Transport’ division, which combines LTL and FTL, seeing revenue in Q3 rise by just 4.9% year-on-year, in contrast to the 15.6% for the first nine-months of the year. The explanation for higher gross profit and operational revenue is that the costs of trucking services has been falling faster than trucking rates.

Like any good freight forwarder C.H. Robinson has been profiting from the gap between the two numbers. The question that may be asked is, why is this not happening in the sea and air freight sectors? Possibly a logistics service provider such as C.H. Robinson has a stronger positioning in the US road freight market than in global sea and air freight, or more likely, the contrast between demand and supply in these latter markets is more harsh.

For information on the forces driving ocean shipping rates, including capacity released onto the market and new builds reaching market, download our free White Paper: Ocean rate tracker Q4 2022, published today.

Author: Thomas Cullen

Source: Ti Inisights

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<![CDATA[ Mounting signs of economic slowdown affecting the global logistics market ]]> The anticipated 2023 slowdown will affect many economies, with countries accounting for one-third of the global economy poised to contract in 2023.

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According to the IMF, the global economy continues to face steep challenges. The anticipated 2023 slowdown will affect many economies, with countries accounting for one-third of the global economy poised to contract in 2023. The global logistics sector will not evade the downturn. 

According to Bloomberg Intelligence’s 2023 outlook for North American truck and rail companies, boom times are coming to an end as cooling economic activity and demand are expected to dent growth in 2023. According to accountancy firm BDO this week, mergers and acquisitions in the UK logistics sector have declined for the third successive quarter amid fragile market conditions.  

FedEx Freight confirmed last week that it is bringing in furloughs in some US markets. The move is due to ‘current business conditions impacting volumes’. Parent company FedEx has been cutting costs in anticipation of reduced demand for the next several quarters. FedEx reported that US deliveries were down by around 10% in the three months from June to August 2022 compared with a year earlier. 

Also, this week, Amazon is reported to be planning the largest layoff in company history, cutting around 10,000 jobs. The job cuts will mostly be from its devices business, but the company is also planning major cuts to its retail division. Amazon has recently scaled back its logistics operations in recent months, delaying or closing more than 60 warehouses. This may have a knock-on effect on Amazon Freight, a third-party logistics operation that in the UK and Europe runs a network of 6,500 trailers and 13,000 carrier partners.  

Shipping container platform Container xChange reported this week that recession and excess inventory has seen shipping prices fall and ports are now clogged with empty containers. The company blamed a decline in consumption at a time when retailers have an excess of inventory. Container freight volumes at the largest US ports were down 3.8% in September 2022 compared to the same month in 2021. The total volume of loaded containers handled by nine major ports amounted to 2.67m TEUs in September 2022, down from 2.77m in September 2021 and 2.85m in September 2020. 

Global air freight traffic fell 10.6% year on year in September 2022, causing a corresponding reduction in freight rates. The September figures published by the International Air Transport Association (IATA) confirm that the slowdown in air freight activity is continuing. Global air freight volumes were down 10.6% on their September 2021 total at 20.33bn tonne-kilometres overall and 10.6% down, too, in the purely international sector.  

In October, DSV, a leading freight forwarder, reported a ‘reduced growth rate’ for its airfreight business in the third quarter as rates declined and consumer demand dropped amid economic uncertainty. Also in November, DPDHL reported that global demand for freight has started to slip and ‘there is no longer any doubt that the world economy is facing difficult times’. Freight volumes fell 12% in DHL Global Forwarding’s air freight business in the third quarter, while sea freight volumes were down 9%. 

It is clear that we are entering a period of economic slowdown, with headcount and assets being trimmed to match demand. Those companies with flexible business models will no doubt fare better than most. How long the economic malaise will last remains to be seen. 

Author: Paul Chapman

Source: Transport Intelligence, 22nd November 2022


Supply chain strategists can use GSCi – Ti’s online data platform – to identify opportunities for growth, support strategic decisions, help them stay abreast of industry trends and development, as well as understand future impacts on the industry. 

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<![CDATA[ LA sees heavy falls in loss to East Coast ]]> From 2020 through to the second quarter of 2022, the port of LA was at the centre of the congestion and price inflation storm that hit the container shipping sector. Things today are very different.

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From 2020 through to the second quarter of 2022, the port of Los Angeles was at the centre of the congestion and price inflation storm that hit the container shipping sector. Things today are very different.

In his monthly report, the port’s director, Gene Seroka, outlined how volumes at Los Angeles have crashed. Container volumes fell year-on-year by 25%, whilst the total for the year so far to October was down by 6% at 8,542,944 TEUs.

Mr Seroka cited “three basic factors for this steep decline”.  The biggest is “cargo that is shifted to the to the Eastern and Gulf coast due to protracted labour negotiations. The second, this year our peak season was in June and July as cargo owners advanced shipments well ahead of the normal holiday cycle. And third, we saw an increase in durable purchases during COVID like appliances and furniture but consumers just don’t buy these types of products every year.”

The benefit of this slide in activity is the ending of congestion at the port. “Dwell times have improved and our backlog has nearly gone. We estimate that our container terminals are only at about 70% of capacity now”. Gene Seroka said that he was desperate to get these container volumes back-up, “when it is working right the best route from Asia to the US is through the port of Los Angeles”. At present he is faced with an up-hill task, with Los Angeles anticipating a further 20 blankings of sailings in November and December.

What is remarkable about this situation is the role that the East Coast ports seem to have played. Even New York, which is far from the most modern complex in the US, has benefited from the shift away from Los Angeles. Nervousness about the vulnerability about operations at the port seems to be focussed on the West Coast, with negotiations with trade unions precipitating that nervousness. Yet both the port management and the local politicians are asserting that the negotiations are proceeding and there is no reason for shippers to be concerned. It seems that shippers don’t quite believe them.

Source: Transport Intelligence,17th November 2022

Author: Thomas Cullen

Supply chain strategists can use GSCi – Ti’s online data platform – to identify opportunities for growth, support strategic decisions, help them stay abreast of industry trends and development, as well as understand future impacts on the industry. 

Visit GSCi subscription to sign up today or contact Michael Clover for a free demonstration: mclover@ti-insight.com | +44 (0) 1666 519907 

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<![CDATA[ European road freight market to lose speed and expand by only 1.1% in 2023 ]]> The outlook for the European road freight market will depend on the outcome of various unpredictable factors such as high inflation, driver shortages, and fuel costs.

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The market moderation seen in the second half of 2022 is expected to spill over into 2023. As a result, Ti forecasts that the European road freight market will lose speed in 2023, expanding by only 1.1% in real terms (holding prices and exchange rates constant) to reach €389,338m.

Overall, downward forces will gain more of an upper hand across Europe in 2023. However, slowing economic growth in the EU exacerbated by high inflation will weaken demand for road freight services in, through and out of Europe.

Europe’s domestic road freight market is projected to grow by just 0.7% in real terms, while the European international road freight market is projected to grow by 2.1% in 2023.

Considering the economic incertitude, it is difficult to make reliable forecasts for the years ahead, and the outlook for the European road freight market will depend on the outcome of various unpredictable factors:

  • High inflation will weaken demand for road freight services in, through and out of Europe;
  • Shortages of raw materials and intermediate products, weakening demand and energy shortages will cloud the outlook for the manufacturing sector in Europe;
  • Consumer behaviour will act as a growth drag on the European road freight market in 2023;
  • Driver shortages will continue to affect the amount of capacity available on the market.
  • Fuel costs, inflation and driver shortages will put upward pressure on costs and road freight rates.

Looking across Europe as a whole, there will be considerable variance in performance. Many markets from Eastern Europe are forecasted to perform better than Western European countries. Germany, Italy and the UK are forecasted to be some of the slowest-growing road freight markets in 2023.

  • The German road freight market growth is expected to slow down sharply to 0.6% in 2023. Germany will be very weak domestically – 0.0% domestic real growth for 2023, whereas its international road freight market will expand by 2.4%. 
  • Italy has a forecasted real growth rate of 0.3% in 2023, with gloomy trade forecasts weighing down growth. With price inflation near a 40-year high and rising interest rates, Italian retail sales and consumer spending could come under significant pressure in 2023, reducing demand for Italian road freight services. 
  • The UK joins Italy and Germany in the worst performers group, with a forecasted real growth rate of just 0.3% in 2023. UK’s retail sales are predicted to flatten out in 2023, contributing to the view that the UK is headed for recession. A slight decline is also expected in UK manufacturing. 
  • The French economy is likely to escape recession in 2023, but the outlook remains weak overall. The global demand slowdown could weigh more heavily on the French manufacturing industry. Retail sales are forecasted to remain sluggish due to declining real wages. Considering all these factors, Ti estimates that the French road freight market growth will slow down to 1.0% in 2023. 
  • While forecasts point to sluggish retail sales growth in Spain, manufacturing production is expected to experience solid growth in 2023. The return of tourism may be critical to supporting consumption. Considering all these factors, Ti forecasts that the Spanish road freight market growth will grow by 1.3% in 2023.

European Road Freight Transport Market – Countries with Strongest & Weakest Growth 2023

 

 

 

 

 

 

 

 

 

 

Growth to 2026

According to Ti forecasts, the region’s total road freight market will grow by 2.4% in the next five years to reach €420,150m by 2026.

Based on solid trade forecasts, the international road freight market is expected to grow faster than the domestic during the five years, although it will remain the smaller of the two markets. 

Nonetheless, the 5-year forecasts for European road freight are uncertain and subject to unpredictable factors such as the length and the outcome of the war in Ukraine, the response to increasing inflation, and the rising cost base for road freight services. 

For more in-depth information, download the European Road Freight Transport Market Forecasts for 2022, 2023 and 2026 Whitepaper, which contains 2023 forecast growth data with analysis of international and domestic projections. The paper also analyses the various economic headwinds impacting the market in the year ahead, including the energy crisis, rising inflation, manufacturing downturn and driver shortages.

Supply chain strategists can use GSCiTi’s online data platform – to identify opportunities for growth, support strategic decisions, help them stay abreast of industry trends and development, as well as understand future impacts on the industry. 

Visit GSCI subscription to sign up today or contact: Michael Clover for a free demonstration: mclover@ti-insight.com | +44 (0) 1666 519907 

Source: Transport Intelligence, 18th November 2022

Author: Marta Chiriatti

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<![CDATA[ Ocean Freight Sentiment Index points towards further rate falls ]]> Sentiment Index. Ti’s Sentiment Index has fallen significantly throughout Q3-22 and now heads into the final quarter in negative territory. Out of 2,379 respondents in Q3, 1,009 expected some levels of rate decrease in the coming 3 months, just shy of the 1,066 who expected rates to rise. In July 54% of respondents expected some …

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Sentiment Index.

Ti’s Sentiment Index has fallen significantly throughout Q3-22 and now heads into the final quarter in negative territory.

Out of 2,379 respondents in Q3, 1,009 expected some levels of rate decrease in the coming 3 months, just shy of the 1,066 who expected rates to rise. In July 54% of respondents expected some level of rate rise with a moderate rate rise being the most likely answer delivering 19% of responses in that month. Just 35% of respondents expected rates to fall in July across all lanes. 3 months on, October data shows that respondent views have changed significantly, 55% of industry minds believed rates would fall in the coming 3 months when asked in October and 40% expected further rises. Moderate and significant decreases in Ocean rates were the most common answer both providing 18% of responses.

On a lane level expectation of further rate rises fell across all three major lanes. On the transpacific lane, the percentage of respondents expecting rates to rise in the coming grew from 36% in July to 59% in October. A significant decrease in transpacific rates in the coming three months is now the most common answer to this survey.

On the transatlantic lane, those expecting rates to rose from 34% in July to 45% in October, however, 42% are still expecting some sort of rate rise in the coming 3 months which keeps the index above 0.

On the East Asia to Europe lane the percentage of those expecting rates to fall increased from 33% in July to 60% in October.

In conclusion, the signs of falling rates are clearly being acknowledged by the market with experts in the industry expecting further rate falls, yet it seems the scars of recent rate rises have cut deep with many still expecting some levels of rate rises in the coming months which prevent the sentiment index from falling deeper into negative territory.

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