The blockage of the Suez Canal at the end of March was like putting a scoop of hot oil on the already burning global shipping market. The market blew up! Ocean freight from China is about to see “the craziest summer in history”.
The Shanghai Container Freight Index (SCFI) hit a record high of 2,980 points last Friday, up 5.2% on a week-on-week basis.
The global container freight rate has reached an average of US$2,980 per TEU. It may exceed the US$3,000 mark this week.
According to the data summarized, as of April 22, 2021, there are a total of 92 ocean line trips suspended from Asia to North America/Europe in April – May 2021.
Among them: 48 voyages to the West of the United States, 19 voyages to the East of the United States, 15 voyages to Northern Europe, and 10 trips to the Mediterranean.
THE alliance has suspended 47 voyages, the Ocean Alliance has 21 voyages, the 2M Alliance has 16 voyages, and other independent routes have 8 voyages.
ASIA – NORTH AMERICA Line
According to the Shanghai Shipping Exchange’s spot (instant contract) freight rate, price of 40-foot container to west coast reached US$4,432, 10%+ increase from March.
The congestion at the US West Port has never eased in the past few months. Now there have been notifications from logistics providers: US shipping lines basically have no space in early May. Ocean freight is nearly paralyzed.
Dozens of container ships are waiting to be unloaded outside the Port of L.A.
To make things worse, dockers in Montreal, Canada’s largest container port, announced an indefinite strike on April 26, refusing to work overtime on weekdays and overtime on weekends.
On April 22, Maersk issued an announcement stating that its trans-Pacific route will be severely delayed in 2021, mainly due to continued congestion at North American ports.
The recent congestion of Asian ports, severe weather, and congestion on the Suez Canal have exacerbated this situation.
This directly led to an increase in ship turnaround time by 2 to 3 weeks compared to the normal situation, making the interval between some voyages departing from Asia more than 7 days.
In the announcement, Maersk announced the adjustment over voyages of 10 trans-Pacific routes. Those adjustment involves Qingdao, Ningbo, Yantian, Nansha, Xiamen, Hong Kong and other Chinese ports. It will be implemented from May this year.
You would not be surprised if your shipment is cancelled last minute.
What can FBA sellers do?
Prepare your cargo early
Prime day is on the horizon. There is rumor that Amazon will have 2 prime days this year. The first one is coming in June. Sellers should prepare early for the shipment.
We are not seeing the situation is easing off soon. As the summer begins, the hot season for online shopping starts. Try to get ahead of other sellers to send your cargo to the other side of the ocean.
Keep calm and carry on
The freight price is not just expensive for you. It happens across the board. As long as you have product in stock and maintain your best seller ranking, you can stay ahead of the competitors.