Shippers should keep their cool and refrain from pushing the panic button as was observed in the first four months this year with the frontloading of imports, particularly into Europe, it said. This increased demand ahead of the traditional third quarter peak season is one of the factors driving the market upwards.

Average spot rates from the Far East to North Europe have continued to rise in July to reach $7,897 per FEU. This means spot rates on this trade have now passed the halfway point (53 per cent) in the climb towards the pandemic peak of $14,783 in January 2022.

The Norway-based ocean and air freight rate benchmarking and market analytics platform noted that it is easy to advise shippers not to panic, but they are seeing average spot rates increase by more than 300 per cent in a matter of months and their containers holding essential goods are being rolled.

Average spot rates on trades from the Far East to the US East Coast and US West Coast are even closer to their pandemic peaks in early 2022 at 72 per cent and 79 per cent respectively.

It is, therefore, completely understandable that a shipper’s sole focus must be to protect its individual supply chains and business interests, Xeneta said.

They will do whatever they can to achieve this, whether it is frontloading imports or paying premium rates to guarantee space for their cargo on board ships.

At this point, the spot market may not reach the heights of the COVID-19 pandemic, but it cannot be ruled out completely and the response of both shippers and carriers in the coming months could be decisive, Xeneta added.

Fibre2Fashion News Desk (DS)