Home » Al Sharqi December 2021 Ocean and Air Market Updates

Al Sharqi December 2021 Ocean and Air Market Updates

Monthly Frieght Market Updates l December 2021

Al Sharqi December 2021 Ocean and Air Market Updates

Monthly Freight Market Updates December 2021

 

Shipping Lines Rates will be Rolled Over in 2022.

 

According to IHS Markit, the dry bulk and container market balance is likely to stay constant in 2022, however, freight prices may need to be adjusted as vaccines minimize pandemic consequences.

 

The market may remain at its top for a longer duration. The investment bank anticipates that shipping revenues will remain high at least through the second quarter of 2022. Global supply chain disruptions might continue for several months.

According to a recent Deutsche Bank prediction, container shipping has entered a “supercycle,” and ocean carriers will make more money in 2022 than they will this year.

 

According to Maersk, the world’s largest shipping line, worldwide ocean-based freight shipping will expand by 7% to 9% this year, a percentage point higher than previously predicted. Supply networks throughout the world have been thrown into disarray as shippers struggle to meet increased consumer demand while also dealing with port disruptions caused by Covid New Variant (omicron) outbreaks.

 

To cut a long tale short, supply chain interruptions may become the new normal for the next six to twelve months.

 

December 2021 United Arab Emirates Sea Freight Market Updates

 

December 2021 United Arab Emirates Sea Freight Market Updates 

The Ocean Outbound Updates

 

Middle East→ North America  

 

One line Status Carriers prioritize port-to-port freight and have limited capacity for interior-point intermodal (IPI) reservations. Advance reservations are strongly advised, as space on the West Coast of the United States, in Houston, and in Savannah is restricted to entirely unavailable. Spot rates are unchanged month after month.

 

Local Rates  Rates continue to increase. PSS/GRI applied by all carriers. (+)

Local Space  Critical (-)  
Local capacity/Equipment Limited but available on selected carrier (-)   

Notes: Bookings need to be made 3-4 weeks 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.

 

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 October and November 2021. In the run-up to the Chinese New Year season and due to blank sailing patterns, some modest increases are likely in December. (+) 

Local Space   Critical (-)  
Local capacity/Equipment  Available (-/=) 

Notes  Bookings must be made 3-4 weeks in advance to secure  

 

Middle East → Oceania  

 

One line Status Congestion at South East Asian transshipment ports is generating several weeks of transit delays. Monthly capacity and spot pricing are unchanged. With advanced reservations, there is a good chance that space will be available.

 

 Local Rates (+)  
Local Space  (-)  
Local capacity/Equipment  (–)  

 

Notes   Bookings must be made at least 4 weeks before  

 

Middle East → Africa  

 

One line Status  Space is limited, and 20′ standard and heavy cargo are much more so; as a result, many carriers have ceased reservations to West Africa. Direct routes are fully booked weeks in advance of their scheduled departure date, and overall schedule dependability remains a concern. Spot rates have gone up month over month.

 

Local Rates The prices are increasing generally (+)  
Local Space  Critical and low in West Africa, particularly in East Africa (-)  Local capacity/Equipment  Limited available (-)  

 

Notes  Maersk Spot is reserved for 2-3 weeks in advance, and goods using “Shipping Guarantee” are given priority.  

 

Middle East → China  

 

One line Status Space is generally accessible, and capacity is increasing and  Spot rates are steady month over month.

 

Local Rates   The prices are increasing generally (++)  
Local Space Tight Space (-)  
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  Occasional challenges to India’s East Coast due to congestion at the Colombo transshipment facility. Trade is generally consistent, and spot rates remain unchanged month over month.

 

 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  Schedules remain unstable due to deliberately decreased capacity caused by ships delayed in the Far East. Space is reasonably available, and spot rates and capacity have remained stable month over month.

 

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 December 2021 

 

North America  

 

One line Status  Port congestion, blank sailings, and port omissions on a regular basis, and no space for export bookings for 4–5 weeks. Some carriers are discontinuing service to the Middle East in favor of Asia trade, particularly on the West Coast of the United States. Spot costs are increasing as capacity is decreasing month over month.

 

Local Rates Rates are stabilizing for December after a full year of MoM increases. (+/=) 

Local Space  Available (-/=) 
Local capacity/Equipment  Capacity is trending down MoM (-) 

Notes:   Book 4-5 weeks before  

 

Latin America  

 

One line Status Due to the move to other trade routes, space is limited, demand is high, and equipment supply is restricted. Spot prices are rising, but capacity remains unchanged month over month.

 

Local Rates Rate increases (+)  
Local Space  very Tight (–)  
Local capacity/Equipment  (-)  

 

Notes: Book 2-3 weeks before

 

Europe  

 

One line Status Although space is relatively open, delays at South East Asian transshipment ports persist. There is still significant congestion at major European base ports, and schedules are unstable. Spot pricing and capacity are unchanged month over month.

 

Local Rates  Rates slightly increased (+)  
Local Space  Critical (-/=)  
Local capacity/Equipment (-) remain the same since November 2021

 

Notes: Book 2-3 weeks before

 

AsiaPacific  

 

One line Status- Carriers’ booking acceptance and service capabilities remain constrained. In Asia, space is limited, and liners are unable to fill capacity shortages as assets are diverted to other trades. Capacity and rates remain constant month over month.

 

Local Rates  increase (+)  
Local Space   critical(-)  
Local capacity/Equipment  tight (-)  

 

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

 

Air Cargo Updates to the United Arab Emirates December 2021    

 

Air Freight Demand– Global demand, measured in cargo tonne-kilometers (CTKs), climbed 9.4 percent in October 2019. IATA released data for global air freight markets in October 2021, revealing that demand remained much higher than pre-crisis levels and capacity constraints had improved somewhat. Based on the identification of a new variant (Omicorn) of concern in South Africa, governments tightened international travel restrictions to gain time and prevent the spread of the Omicron variant.

 

Carrier Capacity – As increasing passenger travel meant more belly capacity for air freight, capacity constraints were progressively being handled. Concerns have been expressed concerning the consequences of government reactions to the Omicron variant. Capacity issues would intensify if it reduced travel demand. After more than two years of COVID-19, governments now have the experience and resources to make more data-driven decisions rather than the predominantly knee-jerk reactions to travel restrictions observed to far.

 

Local rateAirlines 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.

 

North America and Latin America  

 

Flights from the United States to LATAM and particularly In Asian locations continue to be pricey. Rates of entry into Europe have remained stable. Fuel surcharges have increased. Because of the current labour shortage, major European hubs have somewhat longer transit times and a high throughput time.

 

LAX/ORD/JFK Ground handlers are still facing backlogs and are using off-airport facilities to manage the flood of inbound cargo, which has an impact on exports. Many have shortened their free storage duration and implemented new, earlier close-outs for exports to suit longer throughput times and screening requirements.

 

US officials have eased the ban on EU travellers, and European airlines are progressively boosting belly hold capacity. LATAM has also acquired more capacity. Export demand in the United States climbed even more in November. Larger shipments from significant export gateways might take 2 to 4 days to uplift into the EU, LATAM, or Asia from the moment they are booked. Reservations should be made in advance.

 

Europe  

 

According to IATA, International CTKs growth for European airlines climbed from 5.8 percent in September to 8.6 percent in October when compared to pre-crisis levels.

 

Manufacturing activity is resilient but declining, and inflation is growing, albeit at a slower pace than in the US. International capacity was down 7.4 percent from pre-crisis levels, a significant improvement from the previous month’s drop of 12.8 percent. European carriers had an 8.6 percent increase in international cargo volumes in October 2021 compared to the same month in 2019, an improvement over the previous month (5.8 percent ). Airfreight demand is still favoured by manufacturing activity, orders, and extended supplier delivery dates.

 

Although capacity on the Transatlantic trade route has been restored, demand continues to outpace capacity, leading tariffs to rise week over week. More ocean to air conversions are on the market from the EU to the US, as shippers seek the speed of air alternatives to replenish stock levels before Christmas.

 

Congestion at AMS airport terminals has been alleviated; nonetheless, congestion at other European hubs continues to be an issue. It is expected to last till the end of the year and will have a negative impact on all freight forwarders’ travel delays. When space is available, handlers are recruiting additional staff and building new warehouses. Additional terminal entrances and exits are being built to provide space for more vehicles to pick up or drop off goods.

 

Asia    

 

In North China, demand is increasing again, and interest rates have risen from the previous week. The introduction of the South African Omicron variant of Covid is expected to disrupt the global supply chain even further. The market will likely stay tight until the Lunar New Year. Covid-related freight to the EU is rapidly increasing and will most likely be the key driver of the FEWB trade route.

 

Export demand in SouthEast Asia is continuously increasing, and warehouse terminals are overflowing with goods. Bookings should be made at least one to two weeks in advance to guarantee maximum availability. Airlines have yet to announce flight cancellations for the Christmas and New Year’s holidays. Ex-BKK airlines can only accept small packages due to restricted capacity. Reservations should be made at least 10 days before the CRD.

 

Capacity to the US East Coast is practically fully booked in Taiwan through mid-December. Rate increases for US east coast and SFO lanes are planned as a result of persistent high demand and will likely be effective from December 6 through mid-month, while formal announcements are needed.

 

Outside of South China, the market position remained unchanged from November 2021. Because other PAX flights continue to be cancelled, capacity is restricted. Rates for both TPEB and FEWB lanes have risen, especially for FEWB.

 

Capacity to the US East Coast is practically fully booked in Taiwan through mid-December. Rate increases for US east coast and SFO lanes are planned as a result of persistent high demand and will likely be effective from December 6 through mid-month, while formal announcements are needed.

 

The Middle East and Air Carriers ME  

International CTKs growth for Middle East airlines declined substantially in October, from 18.4 percent in September to 9.4 percent in October. This was due to traffic issues on a number of vital routes, notably the Middle East-Asia and Middle East-North America routes.

 

African airlines raised international cargo volumes by 26.7 percent in October, a drop from the previous month’s (35%), but the greatest rise of any region. International capacity was 9.4 percent higher than pre-crisis levels, with the Middle East the only region in positive territory, albeit on a small scale.

United Arab Emirates Freight Local Updates, December 2021  

 

December 2021 Logistics News Updates  

 

  • Maersk has updated Environmental Fuel Fee (EFF), Effective from 1st December 2021, is subject to a monthly review if the price of complaint fuel ( VLSFO -5.0% Sulpher Fuel Oil) moves up or down significantly during the month. Read More Here

  • ESL has imposed IMO 2020 Environmental Fuel Surcharge (EFS), Effective from 1st December 2021, based on a Low Sulphur Fuel price of between US$550 to US$600 per ton for the period of December 2021. Read More Here

  • ESL has implemented General Rate Increase (GRI), Effective from 1st December 2021, from the Middle East to Mombasa, Kenya, and Dar Es Salam, Tanzania. Read More Here

  • Maersk has increased Lithium battery-powered E-vehicle exports. This policy revision ensures the utmost safety and ease of business for their customers. Read More Here

  • Hapag Lloyd has launched eight quality promises to resolve a fast and satisfactory resolution of all cases at both global and individual customer levels.

  • Hapag Lloyd will no longer offer services for the Middle East feeder network, Effective immediately due to the global logistics industry is facing an unprecedented strain. Read More Here

  • Hapag Llyod mentioned customs restrictions for import reefer cargo to Dalian, China. Read More Here

  • Maersk 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

  • Hapag-Lloyd has concluded the first nine months of 2021 with an EBITDA of USD 8.2 billion (EUR 6.8 billion). Revenues rose in the first nine months of 2021 by approximately 70 percent, to USD 17.9 billion (EUR 15.0 billion). Read More Here

  • Maersk Air and OCE teams joined hands to an integrated blend of ocean, air, and inland logistics solutions that helped solve a tricky supply chain exception for a shipment from Bangladesh to the US through Dubai in record time. Read More Here

December 2021 Factory Output News  

 

Middle East  

 

The UAE economy appears to be in good shape with the start of Expo 2020. The PMI decreased to 53.3 in September, but it still indicated a considerable improvement in non-oil business conditions, as firms perceived recovery in demand following the pandemic. The loosening of global travel limitations aided in the growth of new enterprises.

 

Asia  

 

Due to labour shortages, Vietnam’s industries are still struggling to meet year-end production expectations. Manufacturing companies are offering higher compensation and benefits to attract workers as their year-end order books fill up, but few applications are coming in because to the lingering fear of Covid-19.

 

Taiwan Semiconductor Manufacturing Co. (TSMC) and Sony Semiconductor Solutions Corp. (SSS) will collaborate to develop semiconductor fabs in Japan and Kaohsiung.

 

Rationing of electricity has affected important manufacturing centers in China, including Guangdong, Jiangsu, and Zhejiang, with around 20 of China’s 31 provinces affected to varying degrees. High coal prices, unpredictable weather patterns, and the introduction of tougher energy and emissions laws have all contributed to the shortages. While China increased coal output and relaxed certain restrictions in early November.

 

Sri Lanka will boost taxes to cover expenditures incurred as a result of a major fall in value-added tax in 2019. In the 2022 budget, a “super gain tax” will be imposed, targeting huge firms with earnings of more than 2 billion rupees. The super gain tax will charge an additional 25% on large firms.

 

Exciting News This Month

 

  • The Final Mile In Food Logistics. Read More
  • Unlocking Your Sustainable Future With Scope 3 Transportation Emissions. Read More
  • High shipping costs to push up global inflation, UN warns Read More
  • California Increases Truck Weight Limits to Ease Port Snarls Read More
  • Truckers Steer Clear of 24-Hour Operations at Southern California Ports Read More
  • UPS will make deliveries using Waymo’s autonomous Class 8 trucks Read More
  • The shipments component of the Cass Freight Index® was 0.8% higher than the year-ago level in October, similar to the 0.6% y/y increase in September. Read More
  • Cardinal Health Teams Up with Zipline for Automated, On-Demand Delivery to Retail Pharmacies. Read More
  • Half of all logistics sector jobs are to change or be displaced with Industry 4.0. Read More
  • China-Cambodia FTA to enter into force in Jan 2022 Read More 
  • APSEZ plans to abandon Myanmar terminal investment by June 2022 Read More
  • Indonesia may stop tin exports in 2024 as part of efforts to attract investment into the resource processing industry and improve the country’s external balance. Read More
  • Malaysia has proposed a new law to restrict scrap imports for environmental concerns, which would prohibit up to 90% from entering the nation. Read More
  • Shipping Bottlenecks Could Last Well Into 2022. That’s Good News For Investors. Read More
  • Maersk Sees Global Shipping Markets Staying Tight Into 2022 Read More
  • Shipping container lines on track make a record-breaking $150 billion this year from the supply chain breakdown. Read More 

Shipping forecasts see difficult conditions heading into 2022 Read More

Related Articles

Post a comment