Shipment attention! Congestion in many European and American ports is increasing

Shipment attention! Congestion in many European and American ports is increasing

In mid-August, cross-border e-commerce sellers began to prepare for the second half of the European and American sales peak season, which also means the arrival of the traditional shipping peak season . However, the e-commerce market has slowed down this year, and the shipping market is expected to be less hot than in previous years.

 

According to the second quarter financial report of Hapag-Lloyd , the world's fifth largest shipping company , global shipping demand is currently slowing down. Although there has not been a cliff-like drop, freight rates are expected to continue to decline .

 

The Freightos Container Freight Index shows that global freight rates have reached all-time highs since September 2021 , with the average daily price of a 40-foot container on 12 major global routes reaching US$11,127 , eight times the price level at the beginning of 2020.

 

Although the current freight rates have fallen back, they are still much higher than the pre-epidemic level. Data shows that the recent spot freight rates for containers on the China-West Coast route are more than four times that of the same period in 2019.

 

Global consumer spending has cooled this year. Take the United States as an example. Due to the economic downturn, domestic demand has weakened and the amount of goods purchased has declined accordingly .

 

The number of imported containers into the United States decreased in June , and import container volumes at major U.S. ports are expected to slow significantly in the coming months , according to the latest monthly Global Port Tracker Report from the National Retail Federation ( NRF ) and Hackett Associates .

 

 

Despite the decline in the data , U.S. ports have continued to see busy shipping traffic so far this year.

 

For example, the Port of Long Beach in the United States set a new record with nearly 790,000 TEUs in July , an increase of 0.13% compared with July last year. Import container handling volume decreased by 1.8% to about 380,000 TEUs , export container handling volume decreased by 0.5% to about 110,000 TEUs , and empty container handling volume increased by 2.8% year-on- year to about 300,000 TEUs .

 

The port has handled more than 5.79 million TEUs this year through July , up 4.6% from the same period last year.

 

Although the number of imported containers has declined and freight volume has decreased, congestion at many major ports in Europe and the United States is expected to continue in the coming months due to strikes and other actions .

 

It is reported that the current global container shipping congestion index is close to its historical highest level.

 

According to Hapag-Lloyd data , the container shipping congestion index on the East Coast of the United States rose by 53% in the second quarter and in Northern Europe by 26% compared with the first quarter of 2022. Although the congestion on the West Coast of the United States fell by 14% , its congestion is still worsening and will become more severe in the short term.

 

In order to ease port congestion and effectively manage backlogged containers, the Port of New York and New Jersey in the United States recently announced plans to introduce a quarterly "container imbalance fee" to carriers to ensure that the number of containers transported by carriers is more than the amount they unload.


It is reported that the charge will be measured based on the ratio of each carrier's outbound and inbound containers, rather than on dwell time.


The port announced that the fee will be assessed quarterly starting September 1, and carriers’ total outbound container volume must equal or exceed 110% of their inbound container volume during the same period, otherwise a fee of $100 per container will be charged . Inbound and outbound containers include both loaded and empty containers, excluding rail transport volumes.

 

According to Container XChange's "2022 Demurrage and Detention Benchmarks" report , the top five ports in the world with the highest container detention and demurrage are all located in the United States, namely the Port of New York, the Port of Long Beach, the Port of Los Angeles, the Port of Oakland, and the Port of Savannah. After 14 days, the average demurrage per standard container is more than US$2,000, and the Port of New York is even as high as US$3,182.


Higher demurrage charges, strikes, congestion and other shipping chaos have occurred frequently recently. Cross-border sellers need to pay attention to risks and choose carefully .

port

Congestion

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