While ocean rates remain relatively flat coming out of the Lunar New Year (LNY) week, capacity will continue to increase over the next few weeks for the Asia-North America trade, according to the latest Flexport analysis, which also warned of an increase in blank sailings.
The freight forwarder said Transpacific Eastbound (TPEB) capacity is on the rise, but rates remain soft on most origin-destination combinations.
For Asia-Europe, Flexport said space has eased after LNY, and the coming weeks will reflect a considerable drop in volume levels as China resumes work this week.
It added that rates are also moving downwards again due to low demand post-LNY and will be "generally reduced or extended for the first half of February."
For Europe-North America, the report said up until now, the number of blank sailings in the trade has been minimal despite lower demand.
It added that capacity is still set to increase in the weeks to come as MSC and Maersk are adding more vessels in the Mediterranean loops.
The downward trend of the rate, on the other hand, continues and is set to last for the coming months as demand is not picking up at the same pace as in 2022, Flexport said.
Downtrend in airfreight rates
In terms of air freight, the freight forwarder noted that for North China — which includes Shanghai — market rates will decrease quite a bit during the LNY holiday period, starting from January 21 and lasting until the end of the month.
For South China — Shenzhen, Guangzhou, Dongguan, and Hong Kong — Flexport said with the lifting of all Covid measures in mainland China, cross-border traffic is expected to resume gradually.
For Southeast Asia, the freight forwarder noted that demand ex-Southeast Asia overall remains low, with capacity widely available with the exception of Hanoi, which is experiencing a pre-holiday rush and will require as much advance notice as possible.