The closure of the Chinese hub port of Yantian last week added another layer of chaos to an already fractured supply chain, resulting in a further spike in container freight rates from Asia.
Export operations officially resumed at Shenzhen’s port on Monday, however several sources said that it is still “almost impossible” to get boxes tipped at the terminal.
“So far, every vessel scheduled to call at Yantian by every shipping line has been cancelled,” UK-based NVOCC Westbound Logistics told its clients last week.
“The backlog of containers now sitting at the port, surrounding roads and suburbs is astronomical”.
The forwarder said it was still trying to learn how carriers planned to deal with the backlog.
Meanwhile, spot rates from Asia to North Europe jumped a further 10% on the week, according to the Freightos Baltic Index (FBX), with a reading of $10,445 per 40ft.
This is an astonishing 533% higher than the same week of last year, and shippers on the route are still paying significantly more than this in premium fees to secure equipment and get some assurance of shipment.
“No freight from any port in China is fixed until it finally sails, due to so many issues with container equipment, yet Yantian is now adding further uncertainty to rates as a whole and, in particular, FCL and LCL cargo from Yantian itself,” said Westbound.
The FBX Mediterranean component was up just 1% on the week, to $10,204 per 40ft, albeit that this is some 400% higher than a year ago.
And on the transpacific, “things are only getting worse” for beleaguered shippers on the tradelane, according to Jon Monroe, of Washington state-based Jon Monroe Consulting.
He said importers had begun to move orders forward in order to allow more time to get their product to market, and were now beginning to prioritise products based on their profit margins.
On top of this supply chain pain, shippers from Asia to the US were hit by yet another round of GRI’s from carriers on 1st June.
The Loadstar has heard reports of some trans pacific carriers hiking rates by over $2,000 per 40ft – again on top of which, shippers are obliged to pay several thousand dollars in add-on fees to secure equipment and space on vessels.
For the record, the FBX reading for Asia to the US west coast was up 2.7% this week, to $5,518 per 40ft, with the east coast increasing by 1.3%, to $7,502 per 40ft.
Compared with 12 months ago, spot rates on the route are ahead by 154% and 161%, respectively, for the west and east coasts.
As reported last week, the capacity squeeze and rate hike contagion has also hit transatlantic shippers hard, after the normally stable trade lane seemed initially to be unaffected by the problems elsewhere.
Carriers desperate for tonnage redeployed some transatlantic vessels onto other more lucrative trades, and the inevitable impact was for rates to skyrocket as shippers fought for space against the backcloth of strong demand from US consumers.
Indeed, since the end of March, spot rates from North Europe to the US east coast have soared by around 100%, with last Friday FBX reading at $4,286 per 40ft.
Carriers on the route have been quick to introduce premium fees here too, adding to the enormous profits currently being generated on container liner services.