19 November 2020
'Senders take to the air to
escape sea freight hell'
But this has been raising rates in some (price) stable mode in
recent weeks, says freight forwarder With sea freight rates reaching some of the
highest ever seen, equipment shortages, late ships, and still no guarantee of
upgrades, some carriers are starting to get into the air and enjoy the
stability. Increases rates in a mod. UK-based shipping company Metro Shipping.
The firm stated that it has made a debt-free acquisition through a newly
established, wholly-owned subsidiary, which will create northern Europe's
leading cold chain logistics provider.
“The current lack of consistency and reliability of the container line is
unique, and some lines are transitioning to a seemingly operational model,
causing analysts to point to the stupidity of other market participants and
ultimately a business model built behind the carrier,” I said.
“Given the ongoing unpredictability of container shipping lines, it is becoming
increasingly difficult for many shippers to provide adequate service levels to
customers as carriers are actively managing capacity and throughput using the ad
The company highlighted the commentary made by a forwarder colleague in the
trade press: “Carriers are failing, neglecting customers, providing an
acceptable service and still raising daily rates. At least the air transport
industry is not acting so badly, and customers tired of rising ocean freight
rates and falling service levels choose to switch to air freight for a level of
safety and certainty, which is impossible for safety and certainty. in the
Air capacity from Asia to Europe is still limited, and the increase in demand
has caused some airlines to refuse bookings or request a higher rate to upgrade
Scheduled freighter operators are full and many have freight backlogs and
sea-air demand is also increasing, but several airlines have "withdrawn their
preferential rates" without long notice, but they expect this to be a temporary
problem, and it is in the second half of December. "
Metro observed that rising air rates appear to be attracting more capacity to
the markets; KLM, Qatar, and Lufthansa have increased the number and frequency
of flights, although many people have already been booked.
Heathrow and Benelux centers are congested and Shanghai is facing some delays
for large shipments.
“In the weirdest markets, it's not just about rates anymore, it's about making
sure customers get their goods and keep their supply chains running.
"On some routes, fares don't matter right now, the priority is to try and pick
up the cargo on a ship, even if it means a premium for the most critical
Continuing its market analysis, Metro Shipping said, “Signaling the transition
to air transport, our partners confirmed that the market has become more intense
and that after two weeks of stabilization, airlines have started to increase
rates once again.
"Declining service levels and rapidly rising sea and rail freight rates are
encouraging many shippers to switch to the airline, including large volumes."
Recent developments have seen shipping lines cancel confirmed reservations as of
mid-this month, pointing to an increase of $ 1,000 per TEU compared to December,
indicating that no reservations can be confirmed.
“Capacity will continue to be tight throughout December and even until the
Chinese New Year. If the volumes increase further as a result of the critical
ocean situation, it can become a very heavy and continuous peak.