How to deal with the black swan events of container shipping in 2022
December 29, 2021: Reliability and developing a good relationship with carriers, viewing it as a strategic partnership rather than a game that can be won by ensuring the lowest price will isolate shippers from some of the risks and events of the black swan that undoubtedly reserves 2022, according to Xeneta.
“Stability and predictability can also be achieved by signing multi-year agreements that few carriers currently request, as they guarantee capacity. However, to avoid paying today’s rates after the market downturn, these contracts must include an adjustment mechanism to reflect future market conditions. “, adds the update.
So what happened in 2021?
The actual capacity of the vessels would have handled the demand if conditions ashore had remained stable. “Compared to 2019, rather than 2020 affected by the pandemic, volumes in the first ten months of the year increased by 5.5%. On the other side of the supply / demand balance, the capacity of the container ship fleet increased by 7.4% in the same period.
“In other words, the current situation in the freight market cannot be explained by ‘simple’ market fundamentals. a ship can do.
Ships ordered this year will not be delivered until 2023. “Unless ports and hinterland connections can ensure the free flow of goods, end-to-end, these additional ships will simply join the queue outside ports. “
Rising freight rates
Freight from North Asia to the west coast of North America was valued for the week ended Dec. 23 at $ 9,500 / FIRE, up from $ 500 on the week amid discussions on the Escalating constraints on the supply side and preload ahead of the Lunar New Year, S&P Global Platts said in its update.
Market sources expect further increases in the new year, with discussions of January increases to $ 1,000 / FIRE on an FAK basis, he added.