Monthly Ocean and Air Freight Market Updates       

January 2022     

The Top Story of the Month     

By 2022, MSC may have replaced Maersk as the world’s largest shipping line. 

The Mediterranean Shipping Company (MSC) has surpassed Denmark’s Maersk to become the world’s leading shipping line, according to the Alphaliner. MSC paid $50.5 million for the ship last year. MSC’s fleet can currently hold 4.3 million standard 20-foot containers, almost 2,000 more than Maersk. MSC and Maersk now have a 17 percent market share of the container shipping business, ahead of CMA CGM, COSCO, and Hapag-Lloyd.

scrubber-fitted capacity (teu) by carrier and proportion of fleet

MSC is expected to strengthen its place atop the cargo container market in 2022 and beyond as it prepares to acquire a new container ship orderbook of 999,808 TEUs, by far the largest of all shipping companies. When the 4,992 TEU-capacity MSC effectively ended Maersk’s decades-long supremacy as the world’s largest cargo carrier. 

percentage share of other companies

January 2022 United Arab Emirates Sea Freight Market Updates     

The Ocean Outbound Updates     

supplier delivery times PMIs

Middle East→ North America     

One line Status Due to limited space, particularly for Inland Point Intermodal (IPI) booking, carriers prefer port-to-port cargo, with breakbulk conversion becoming most typical. Space on the West Coast of the United States, in Houston, and in Savannah is restricted to entirely unavailable, and capacity and spot fees are stable MoM.  

Local Rates Rates continue to be high. (++)   
Local Space  Critical (–)     
Local capacity/Equipment Limited/ Undercapacity (-)      
Notes  Bookings need to be made a month ago in advance     

Middle East → Latin America     

One line Status Spot rates have gone up month over month, due to congestion at transshipment ports. Carrier alternatives are confined to South America’s East and West Coasts, and huge volume reservations are particularly difficult. Month over month, capacity remains constant.   

Local Rates The prices are increasing generally (++)     
Local Space Very tight (–)     
Local capacity/Equipment (-/=)     
Notes  Bookings need to be made at least 4 weeks before    

Middle East → Europe     

One line Status Space in Northern Europe is accessible, while space in the Eastern Mediterranean is a little tighter. Spot rates are consistent month over month, and advanced reservations are strongly advised.   

Local Rates Rates continue to be at an all-time high. However, they have remained constant during November 2021 and December 2021.  (+)    
Local Space   Extremely Critical (–)     
Local capacity/Equipment  Available (-/=)    
Notes  Bookings must be made a month ago in advance.   

Middle East → Oceania     

One line Status Congestion at South East Asian transshipment ports is triggering several weeks of transit delays. Spot rates are trending up month – over – month, despite the fact that space is modestly better but not reaching demand.  

 Local Rates (+)     
Local Space  (-/=)     
Local capacity/Equipment  (-/=)     
Notes   Bookings must be made at least 4 weeks before     

Middle East → Africa     

One line Status  West Africa’s space is quite open, although there is a lack of equipment coming out of Turkey. East Africa’s space is opening up, but scheduling delays restrict weekly sailings, while South Africa’s capacity is still constrained. Monthly capacity and spot rates are unchanged. 

Local Rates The prices are increasing generally (+)     
Local Space Critical and low for East Africa, while relevantly at ease for South and West Africa (-)      
Local capacity/Equipment  available (=)     
Notes  Only bookings made at least 3-4 weeks in advance  

Middle East → China     

One line Status A recent Covid-19 outbreak in the Chinese city of Ningbo has raised worries about the possible impact on the workforce and the supply chain at the Ningbo-Zhoushan Port. Carriers focus on transporting equipment back to Asia for local exports since space is generally available.   

Local Rates   The prices are increasing generally (++)     
Local Space  Extremely Tight (–)     
Local capacity/Equipment  available (-/=)     
Notes   Book 2-3 weeks ahead    

Middle East → Mediterranean MED     

One line Status Rates remain high. Space is constrained and only available at a premium price. Carrier preference is for lightweight freight.   

Local Rates  The prices are increasing generally (+)     
Local Space  Limited but at a premium (-)     
Local capacity/Equipment  available     

Middle East → ISC (Intra-Gulf)     

One line Status  Because there is often enough capacity, carriers concentrate on returning equipment to Asia for local exports. Turkey is lacking a bit of equipment. The UAE is dealing with a lack of 20ST.  

 Local Rates  The prices are increasing generally (+)     
Local Space available (=)     
Local capacity/Equipment  available     
Notes  Bookings must be made at least 2-3 weeks in advance to ensure availability.     

Middle East → Far East Asia     

One line Status  There is a change in the demand in the rates offered throughout the market; space is relatively open, with the exception of North India; and there are some equipment availability concerns. Spot rates are increasing MoM 

Local Rates  The prices are increasing generally (+)     
Local Space Limited Space (-)     
Local capacity/Equipment available (=)     
Notes Bookings must be made at least 2-3 weeks before    

United Arab Emirates Inbound Ocean Market Updates 

January 2022   

number of calls by weekly far east-north europe

North America     

One line Status  Due to high congestion at transshipment hubs, certain carriers are canceling service to the Middle East from the United States’ West Coast. Port congestion, frequent empty sailings and port omissions, limited space, and more accessible options from the East Coast. Spot prices are increasing as capacity is declining MoM.   

Local Rates Rates have been increased (+)    
Local Space  Extremely Critical  (–)    
Local capacity/Equipment  Critical (-)    
Notes   Book 4-6 weeks before     

Latin America     

One line Status Transshipment delays and a lack of equipment 

Local Rates Rate increases (+)     
Local Space  Critical (-)     
Local capacity/Equipment  (-/=)     
Notes   Book 2-3 weeks before   

Europe     

One line Status In Italy and the United Kingdom, there is a dearth of equipment and dray power. Space is fairly open, however, there are some equipment shortages and delays in South East Asian transshipment ports. 

Local Rates  Rates slightly increased (+)     
Local Space  Critical (-/=)     
Local capacity/Equipment Available 
Notes   Book 2-3 weeks before, shortage of 20ST  

AsiaPacific     

One line Status- Continuous Ocean Alliance blank sailings in Asia. Carriers are lowering their rates somewhat in order to stockpile rollover cargo and fill boats over the Lunar New Year holiday. There are still significant freight backlogs that cannot be shipped before the holidays.   

Local Rates  increase (++)     
Local Space   critical(-)     
Local capacity/Equipment  Undercapacity (-)     
Notes   Book 2-3 week before 

Indian SubContinent (ISC)      

One line Status  Space is limited, therefore prior bookings are advised. Equipment availability is also limited. Spot rates are rising, but capacity is remaining stable month over month.  

Local Rates  Rates increase (+)     
Local Space Critical  (-)     
Local capacity/Equipment (-/=)     
Notes Book 2 weeks ago, Shortage of 20ST 

Air Cargo Updates to the United Arab Emirates January 2022   

global volume development and regional volume development

Air Freight Demand–  PMIs over 50 in major markets indicate that volumes will be solid in the coming months. As port congestion intensifies, the transition from ocean to air freight will continue. The spike in demand continues to be witnessed in a variety of industries, including high-tech, automotive, and pharmaceuticals. E-commerce continues to contribute to higher levels of air demand. Cargo demand will remain strong over the Christmas shopping season, as will new tech product releases. The arrival of Omicron is likely to hasten PPE movements.  

Carrier Capacity – Capacity is still insufficient to satisfy current demand. Global capacity is still being hit, with a -21 percent drop since November of last year. Belly capacity rose slightly in response to larger vaccination doses, although it is still -31% lower than pre-COVID levels. The capacity of ASPA is expected to be limited until the end of the 2022 Beijing Winter Olympics and the Chinese New Year Holiday Spring Festival. 

Local rate– Airlines continue to actively limit yields; extra capacity is still available for a fee. On August 21, rates were +86% higher than the 2019 baseline and +20% higher than the higher 2020 baseline. Rates will remain high as huge demand growth continues to outpace limited capacity. Rates to/from Asia Pacific (especially China) are expected to remain high due to ongoing constraints; market rates are around four times higher than the average.   

carrier rate
capacity development by aircraft configuration January 2019 to November 2021
Global freight load factor development

North America and Latin America     

Omicron has resulted in multiple cancellations and delays of domestic and international flights in the United States. Most terminals give reduced free time for storage and early close-outs for exports to match throughput timings and screening requirements. Congestion at European hubs is improving, resulting in a slight reduction in average dwell time at destination. 

Rates to Latam have dropped throughout the holidays and summer vacation, but they remain higher than typical. In recent weeks, rates in Europe and Asia have been consistent. Larger shipments from large outbound gateways may take 2 to 3 days to be picked up from the moment they are scheduled. 

The terminals at LAX/ORD/JFK have reduced the inbound backlog cargo significantly, which benefits the export side. Although export demand in the United States has decreased slightly, capacity remains manageable. 

Europe     

There have been a few flight cancellations as a result of Omicron, but the market has enough capacity to accommodate the slack demand. Deferred routings when airlines have passenger capacity remain a tempting option at a good rate level if there is room for a longer transit time. 

Demand is still low, and rates have fallen somewhat in all North American destinations. We foresee a return to slack demand in the coming weeks. 

The demand for air travel has increased to the point that airlines are upgrading their flight schedules on a regular basis. The problems of the ocean market keep demand high, and we should expect some volatility in spot market rates in the foreseeable future. 

When it comes to leaving the EU, the advice remains the same: book early to get the best rates and solutions. Consider exporting smaller quantities by air freight, since costs and solutions may be most advantageous in this instance. There has been no report of congestion at Europe’s biggest export gateways. 

recovery in international travel will be uneven in 2022 intra-europe and europe-nth America travel will outpace Asia

Asia      

Several flights in the TPEB lane ex-South China were canceled in Week 1 after airline crew members tested positive for Covid-19, with potential extensions into Weeks 2 and 3. Rates in the FEWB market have fallen this month, and market capacity is typically adequate in comparison to last month. Destination terminal congestion in South China has improved because of a drop in demand over the holiday season. 

The market has been pretty tranquil, and carriers are eager for volume. However, due to Covid worries in Hong Kong, some goods may be redirected through North China, resulting in an increase in demand in North China in the second half of January. 

In Taiwan, market demand started slowly, but it is starting to pick up ahead of the Lunar New Year holiday. Space to and from SFO remains in great demand. 

After the holiday break, demand ex-Vietnam has declined somewhat in southeast China, with TPEB rates suggesting a negative trend. Carriers continue to favor palletized items over loose carton shipments. This week saw the start of work for the majority of Thai companies. Although demand ex-BKK is improving, it remains below the previous month’s level. Some airlines have also reduced their rates somewhat from the previous month. 

The Middle East and Air Carriers ME        

Carriers in the Middle East have experienced a significant drop in international CTKs, with growth relative to pre-crisis levels decreasing from 9.7% in October to 3.4 percent in November. The enormous Middle East-Asian trade route may be contributing to a falling trend in SA (seasonally adjusted) volumes.  

seasonally adjusted ctks

United Arab Emirates Freight Local Updates, January 2022     

United Arab Emirates Freight Local Updates, January 2022

January 2022 Logistics News Updates     

  • Hapag Lloyd has updated the Marine Fuel Recovery Surcharge (MFR), Effective from 1st January 2022, which is applicable for all trade. It is composed of three elements: Schedule Data, Consumption, and Utilization. Read More Here 
  • PERMA has updated UAE local charges Export tariff revision from 1st December 2021, VSL sailing Bill of Lading AED 530/ BL SET will be applicable. Read More Here 
  • CMA CGA has implemented revision of carrier and local charges. Effective 1st January 2022 for UAE. Read More Here 
  • CMA CGA has revised the Terminal Handling Charges (THC) for shipments to and from Port Khalifa(Abu Dhabi), Effective from 1st January 2022. Read More here 
  • CMA CGA has informed all clearing Agents and forwarders they will not be providing invoices to consignee vendors from 15th Jan 2022. All import shipment freight and local charges invoices will be available on customer web login cmacga.com 
  • Emirates shipping line has increased General Rate(GRI) from UAE to Zanzibar, Tanzania. Effective from 11th Jan 2022, applicable for all UAE cargoes connecting on this vessel/voyage in order to sustain and continue to provide a high-quality service. Read More here 
  • UAFL has implemented  a Late Bill of Lading (B/L) release fee, Effective from 1st Jan 2022, in case of any delay in collection of Bill of lading documents for all the vessels departures on and after 1st Jan 2022 Read More Here 
  • ESL has implemented an Environmental Fuel Surcharge (EFS), Effective from January 2022,  as per below will be imposed based on a Low Sulphur fuel price of between US$600 to US$650 per ton and will remain the same in February 2022. Read More Here 
  • MSC will be implemented late D/O collection fee, Effective from 1st February 2022. Read More Here 
  • Maersk offers the broadest coverage and competitive transit times at unmatched reliability, effective February 1st, 2022, that will proceed and cancel any booking booked through SSIB aging 15 days and above with no container(s) linked to it to free up space allowing the opportunity to more customers to book, materialize and load their shipments with them. Read More Here 
  • CMA CGA has implemented Peak Season Surcharges (PSS03), Effective from February 15th 2022, for cargo from Middle East Gulf, Red Sea to USEC + USGC + Canada East Coast. Read More Here 

January 2022 Factory Output News

Middle East     

Financials overtook Healthcare to earn the top spot in the global sector output ranking in December. Despite a global increase in COVID-19 instances, consumer services was the worst-performing industry.   

Global Output index

United Arab Emirates: According to the Emirates Nuclear Energy Corporation (ENEC), the second unit of the UAE’s Barakah nuclear power plant will begin commercial operations in the coming months, while the third unit of the station’s planned four reactors will begin operations in late 2022. 

Saudi Arabia: Almarai, a Saudi food powerhouse, has agreed to purchase Binghatti Beverages Manufacturing’s beverage factory in the United Arab Emirates for 215 million dirhams ($58.5 million). 

China reverses a three-year decline in auto sales and moves to a vehicle powered by alternative energy. According to China’s development strategy, NEVs will account for around 20% of all automobiles sold in 2025, with the bulk of them being the brands of Chinese-owned automakers. – Import volumes of automobiles will be reduced in the future. 

Cambodia: The Cambodian Development Council (CDC) has approved nine new $43 million investment projects.  

Singapore: Changi Airport is once again soaring in terms of aircraft cargo traffic, after two years of pandemic-induced worldwide delays gave way to increasing demand fueled by supply chain disturbances and an internet shopping boom.  

Pakistan: Textile exports dropped by $250 million in December due to a gas shortage, which reduced the number of employees in mills and manufacturers. 

Philippines exports are improving, with a 15.2 percent gain from January to November 2021. Boosted by a 95 percent increase in the value of coconut oil exported. Other major exports that expanded by double digits or more were electronics, manufactured goods, and mineral commodities. 

United States: According to the Empire State Manufacturing Survey, manufacturing activity in the United States has slowed to begin the new year, falling for the first time since June 2020. The new orders index fell for the first time in 17 months, although input prices for manufacturers remained high. 

Exciting News This Month   

global container volume YoY import change by destination region
  • Congestion and bottleneck problems are worsening getting into 2022. Read More 
  • Supply chains disruption is likely to continue in the first half of 2022. Read More 
  • Here is a list of last-mile delivery companies and startups transforming shipping and same-day delivery Read More Here 
  • New trucking vaccine mandate is likely to make fruit and vegetables more expensive Read more Here 
  • 10 major airlines have signed a letter warning of massive flight disruptions and supply-chain chaos as AT&T and Verizon plan to roll out 5G services Read More Here  
  • 8 top companies chasing the $61 billion e-commerce packaging market Read More Here 
  • FedEx Logistics to call at Hueneme for three voyages Read more here 
  • Tanger Med’s container handling grew even faster in 2021 than in 2020. Read More here 
  • American Airlines cut 674 flights on Sunday, the most cancellations of any airline, FlightAware data showed. Read More Here