A slowdown at the Panama Canal due to drought (Kiplinger)
Low water in the canal has led transit times for ships to quadruple, from about two-and-a-half days in June to 10 days now. The delays could impact the availability of certain items this fall during the holiday shopping season, but it shouldn’t be as bad as in 2021 and 2022. The bottleneck at the canal could reroute more ships to the West Coast, as shippers decide to send more goods to Pacific ports and then inland by rail. That would eat into the market gains that East Coast ports made during COVID-19 amid chronic delays at Long Beach and other West Coast ports. In the longer term, shippers also need to worry about possible work stoppages at East Coast ports. While contract negotiations with port workers in the West led to a new pay deal and averted strikes, their East Coast counterparts’ contract is up for renewal in 2024.
| Lufthansa Cargo increases Airfreight Surcharge to 0.65 USD per kg |
| The sum of cost components in our airfreight surcharge has increased in the past weeks. Consequently, Lufthansa Cargo is increasing its Airfreight Surcharge, effective September 25, 2023, from 0.60 to 0.65 USD per kg chargeable freight weight. Please note, the latest acceptance time (LAT) of the booked/confirmed flight, not the AWB issue date, determines the applicable Airfreight Surcharge. |
Look for ocean freight rates to fall (Kiplnger/Drewry)
A glut of excess capacity should continue to weigh on ocean shipping rates as new ships that carriers add outnumber older ships that are scrapped. As a result, look for average ocean freight rates to fall by 33% versus 2023, per the forecast of maritime consultancy Drewry. That’s on top of even steeper rate declines this year. If you ship by air, budget for modest rate increases next year. The industry is dealing with overcapacity now, but a pickup in demand, coupled with retirements of older, less profitable aircraft, should tighten the market and lift rates by 10%-20%.