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The outlook for ocean freight market remains healthy as the year draws to a close, according to the latest DHL Ocean Freight Market Update
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The demand is driven by early Lunar New Year and anticipated policy changes in the US
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China’s exports are exceeding forecasts as factories rush production to meet demand ahead of possible trade adjustments
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Some container lines have reported full bookings from Asia into the Americas, likely due to shippers adjusting schedules in response to the new tariffs under Donald Trump
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Freight rates stayed much higher compared to last year
The outlook for the ocean freight market remains healthy as the year draws to a close, driven by the early Lunar New Year as well as anticipated policy changes in the US, according to the December DHL Ocean Freight Market Update.
Specifically, China’s exports are exceeding forecasts as factories rush production to meet demand ahead of possible trade adjustments.
Niki Frank, CEO of DHL Global Forwarding Asia Pacific, said: “We are seeing steady demand, though the market is reacting more slowly than many were expecting given the disruption on the radar.”
He added that if the typical season trend holds, the company expects a “slight bump” toward December and January.
Based on the report, underlying trends remain favorable, with subzero core goods inflation and decreasing services inflation in the G5 economies.
The DHL Ocean Freight Market Update Report is a monthly publication by DHL Global Forwarding which tracks and analyses the latest developments of the global ocean freight market.
Its capacity outlook states that disruptions on services can be expected as alliances are shifting to their new set up, mainly on East-West trades.
The report noted idle fleet of container ships hit an all-time low of less than 1% this year, with larger ships of 12,500+ showing almost no idling.
Yearly dry container production, meanwhile, could hit 7.3 million TEU, surpassing previous years with a 6.5% year-on-year growth.
Freight rates stayed much higher compared to last year, and there is an expected rush to bring in US imports before the new tariffs planned by President-elect Donald Trump go into effect.
Transpacific freight rates, however, have shown small decreases, even as several carriers announced new rates beginning Dec. 1 in anticipation of the Lunar New Year rush.
The expected new “Trump tariffs” take effect when he assumes office in January, creating mid-term uncertainty for the US’s largest trading partners, namely China, Canada, and Mexico.
In another development, the Red Sea crisis continues with no clear end in sight.
The global container market continued to recover in the third quarter of 2024, with indications that it will stay on track for the remainder of the year.
The manufacturing sector had an ever so slight hike in output in October after falling in September.
With the exception of emerging markets, the International Monetary Fund expects world trade growth to recover strongly this year, continuing until next year.
A notable market development this year was the reduced capacity of carriers due to closed loops and the replacement of large ships with smaller vessels.
At yearend, outbound Asia rates stayed volatile as demand stayed strong, due to the Lunar/Chinese New Year boost.
However, adverse weather conditions contributed to vessel delays and equipment imbalances.
As an example, North Asian ports were being cleared after recent typhoons in the region.
Congestion became an issue, although there was marked improvement by October. Heavy winds had caused Antwerp to face delays, and UK and German ports experienced heightened congestion.
Congestion remained a problem in such US ports as New York, Norfolk, Charleston, and Savannah, while Canadian ports resumed full operations after recent strikes.
