For this week’s logistics market update, global air and ocean capacity is easing, typhoons continue to disrupt Shanghai and Ningbo, a deadly Red Sea attack has raised concerns over Suez routing, and Union Pacific has raised California intermodal surcharges.
Keep reading to find out the latest details!
Transpacific Ocean & Air Update
With the early peak season easing and additional capacity being introduced, the US West Coast rates have stabilized and remained steady for August. Some carriers have started to offer bullet rates by sailing.
The space capacity from Far East to US East Coast/US Gulf remains tight for a variety of reasons, including the escalating Panama Canal restrictions and recently frequent Typhoons in Asia. Blank sailings and schedule changes are expected to continue, and shippers should book as early as possible where possible.
Panama Canal Update
Panama Canal draft restrictions are already having a measurable and significant impact on the effective capacity of Neopanamax vessels on the USEC trade, increasing operational uncertainty and cost pressure to the USEC supply chain.
- The situation of the Panama Canal is still controllable for now, however, the situation is expected to get worst in Q4, and the impact may last until Q1 2027.
India Update
Ocean freight markets remain challenging as carriers continue to carefully manage vessel capacity and allocations across major trade lanes.
- Guaranteed ocean space remains unavailable across most services due to carrier vessel allocation control, while 40-foot equipment shortages out of Asia and severe congestion at Nhava Sheva persist.
- Air freight capacity remains constrained heading into the second half of the month, driven by elevated export demand.
- Carriers are continuing to prioritize long-term contract cargo: pharma, automotive, engineering, e-commerce, semiconductors, fashion, and perishables.
China Port Disruptions
- Following Typhoons Bavi and Noul, freight had already backed up. With Typhoon Dolphin, it is expected to take several weeks to clear the port congestion.
- Repeated typhoons have hit Shanghai, Zhejiang, Fujian, and Guangdong for weeks. The latest storm, Typhoon Dolphin, closed Shanghai and Ningbo for a weekend.
Shanghai: waiting times are up to 9 days. There were 148 vessels waiting at anchorage before Typhoon Dolphin, and the number increased to 201 vessels waiting for berth at anchorage as of August 13.
Ningbo: waiting times have increased to 5 days with 28 vessels awaiting berths.
Qingdao: waiting times are increasing to 3 days because of concentrated vessel arrivals and dredging work.
Busan: waiting times are around 2 days right now. But the congestion is expected to increase as carriers are skipping Shanghai due to serious port congestion and bringing containers to Busan by feeder service.
Red Sea Update
- An attack on a cargo vessel off of Yemen killed three seafarers in regional conflict
- This attack threatens the plan to return carrier routing to the Suez; some have resumed selected sailings in the past months with added security measures and plans to route to the Cape of Good Hope if any other incidents occur.
Rail Update: Union Pacific Peak-Season Surcharges
- Union Pacific has raised its Southern California peak season intermodal surcharge significantly and added a new surcharge in Northern California
- This is targeting shippers that are below their contracted volumes.
- The increase comes as Union Pacific’s intermodal volumes are climbing year over year.
What This Means for Shippers
Capacity looks to stay tight through the end of August, China’s typhoon season remains unpredictable, and the Red Sea risk may slow down the return of Suez transits. We recommend building in extra lead time and planning for unexpected delays.
If you have upcoming import or export shipments, our team can help you secure space, navigate these market changes, and avoid potential delays!
