Freight rates updates for 2021
The year 2021 has been a turbulent period of time in our lives. The novel Coronavirus pandemic has had an effect on all areas of our personal lives and business as well. Furthermore, its impact on the global shipping trade has been massive. If you had to transport cargo overseas anytime in the past year, you have certainly noticed the rise in prices, huge delays, and constant new issues popping up. In turn, this affected the global economy at large, and we will surely be experiencing the effects for months to come. In case you are planning an international relocation soon, our shipping experts here at Kokusai Moving bring you the latest freight rate updates for 2021. Below you’ll find everything you need to know about cargo forwarding in the current year.
How coronavirus impacted freight rates in 2021
Firstly, we have to look at how the pandemic of coronavirus impacted global trade. Project cargo fees have skyrocketed this past year. Prices have been at an all-time high ever since the pandemic hit. Hence, general trade prices surged as well. Many people don’t know how important container rates are for the economy. Almost everything from clothing to protective masks and medical supplies is transported in containers. The rise in online shopping and medical materials led to a container shortage. Consumers changed their shopping patterns, which in turn negatively affected trade. The increase in demand was much stronger than anticipated, some experts say. The industry simply wasn’t prepared for what was going to happen. Moreover, strict lockdowns and new safety protocols further delayed shipments. As covid measures lessen, everything should slowly go back to normal.
Airfreight rates updates for 2021
From Europe to Asia to the United States air freight rates are steadily increasing. Even though a small downward trend happened in the month of May, prices are up again as of June. Ocean freight is all booked up, thus businesses are turning to air transportation. Because of the sudden high demand and a limited amount of space, air freight rates increased. Additionally, a lot of consumers turned to online shopping which influenced cargo fees. Most companies are now providing rates on a monthly basis. If you’re regularly transporting goods, be sure to contact your moving service Japan at least a month in advance. Since the market is highly volatile, the more time you give us to process and schedule your booking the better. This is the best way to ensure your cargo arrives safely and on time.
New developments in sea freight fees
Next, we should definitely look at ocean cargo fees as it is the area with the most changes. As of last month, rates are still increasing exponentially. Things aren’t looking up for sea freight forwarding. The month of July is usually a very busy period, thus a positive change is very unlikely. Consumer demands are staying high, as retailers try to restock items before the back-to-school buying begins. Unfortunately, this means that there won’t be a decrease in sea freight fees in the foreseeable future.
Some fast facts on sea freight updates for 2021:
- congestion in major ports is slowing down shipping
- equipment shortages cause further delays
- Asia-Europe corridor rates rose by another 7 percent in May
- Asia-North America rates are 218 percent higher than last year
- most carriers report a lack of space and containers
Main issues in the industry
A wide variety of problems caused freight forwarding price trends to worsen. Firstly, shipping times nowadays are much longer. Because of the congestion and delays within major European and American ports, vessels can’t dock. To prevent getting stuck, ships are slowing down. Instead of going at full speed, most navigate at around half of their usual speed. Additionally, when a ship gets to a port, the unloading time is much longer. Consequently a loop of delays forms. Loading and unloading are also taking a lot longer than usual. Some estimate a slowdown of 30 to 50 percent. Alongside covid measures, and a smaller number of workers it is causing significant delays. Lastly, another great issue is equipment shortages. From containers to trucks there’s not enough equipment to handle the increase in demand.
Unexpected updates in cargo forwarding
Additionally, 2021 brought some unexpected events that further hindered the industry. Two times this year, freight forwarding price trends surged because of human error. The first such event happened in March when the Suez Canal was blocked for almost an entire week. The cause of this was the container ship Ever Given getting stuck in the tight passage. For six days, more than 400 ships were immobilized and couldn’t continue their routes. Consequently, many shipments got delayed and retailers all over the world couldn’t access their cargo. Furthermore, there is another disruption happening in China as we speak. Yantian port and surrounding areas are severely congested and understaffed. This led to two-week-long delays in the port. No one really knows when the situation is going to resolve itself.
What the future holds for freight fees
Finally, we’ll take a look at the future. With the market being extremely volatile and ever-changing it is very hard to predict what is going to happen next. Finding a clear answer on the best time to transport cargo is almost impossible. Peak season is only about to begin. In case you have something important to transport, you should act on it immediately. Once covid measures lessen, it is possible we will see a dip in freight fees.
In conclusion, freight rate updates for 2021 haven’t been exactly positive. With sky-high prices, delays, blockages, and many other issues it’s hard to find good news. If you plan on relocating, moving inventory, or forwarding cargo the best thing you can do is a plan in advance. It is possible you will still run into issues but some should be mitigated by booking in advance.