The shipping container market has peaked
The impact of the looming strike at US ports
As the October 1 deadline approaches, there is a real threat of a strike by port workers in the U.S. East and Gulf Coast. Companies are trying to avoid disrupting their supply chains and are therefore moving goods to the West Coast or even using expensive air freight. If a strike does occur, inflation could rise and 100,000 jobs could be lost.
Possible increase in maritime freight rates
A planned strike at US ports could cause a short-term rise in ocean freight rates. The market, which has been on a downward trajectory in recent months, could see rates rise again as a result of industrial action. Carriers are already announcing the introduction of “disruption charges”.
Market and carrier reaction
While some carriers are still increasing rates, others are starting to offer lower prices, indicating increased availability of capacity in the market. This means that traders once again have the chance to negotiate prices and do not have to accept any price offered to secure the carriage of their containers.
Key Market Indicators
According to Xenet data, intermediate rates in the US and European markets are stabilising, suggesting that the peak of the spiralling growth is over. Market mid-high rates remained almost unchanged during July, suggesting that traders no longer need to pay higher rates to secure the carriage of their containers.
Long-term prospects and challenges
Although the situation is stabilising, freight rates remain significantly higher than in previous years, as a result of the conflict in the Red Sea and the rerouting of ships around the Cape of Good Hope. Unless ships return to the Suez Canal, the situation will not be fully resolved.
Final thoughts
The hope of a softening market brings relief to traders, but problems persist. As the year-end months approach, it will be interesting to see how the situation unfolds.
In conclusion, the market is stabilising, but problems remain a challenge for all stakeholders.
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