The latest news about Air Freight and Sea Freight Market in December/2021 (Second Fortnight).
Key Points:
Global GDP is projected to grow by 5.7% in 2021 and 4.5% in 2022. A strong rebound in Europe, the likelihood of additional fiscal support in the United States next year, and lower household saving will boost growth prospects in the advanced economies.
As of the 16th December 2021, 92 336 commercial flights were flown in the last seven days, compared to 69 957 and 112 699 in 2020 and 2019, respectively.
In week 48, worldwide volume decreased by -1% compared with previous week. Worldwide capacity remained stable week-over-week.
41 cancelled sailings have been announced between weeks 50 and 01, out of a total of 552 scheduled sailings, representing 7% cancellation rate.
Schedule reliability recorded another marginal improvement in October, of 0.4 percentage points to 34.4%, maintaining the range of 34%-40% seen throughout the year.
Data from the last November edition of the Alphaliner Weekly Newsletter shows that as in 2020, Yang Ming, Evergreen and Wan Hai have registered the largest share price increases during 2021.
Economy
RAISING EXPECTATIONS
Q1 2022 inflation is now projected to be 5.6% in the US, revised up from 4.6% in September and 3.0% in May; in the euro area, 3.2%, 2.1% and 1.2%, respectively. Disruptions in energy, food and commodity markets and supply bottlenecks have been a feature of the recovery since economies reopened in 2021.
While economic output in most OECD countries has now surpassed where it was in late 2019, supply and inflationary pressures – along with renewed fears over new COVID variants and associated constraints on healthcare capacity – risk stifling the global economic recovery.
Enhanced global co-ordination on vaccines is key: better vaccination efforts, especially in lower-income countries, should lower the risk of mobility restrictions and consequent effects on economic activity, which are a major source of current supply chain pressures.
Air Freight
Market Trends (31/05 - 05/12)
In week 48, worldwide volume decreased by -1% compared with previous week. Worldwide capacity remained stable weekover-week.
On a regional level, volumes from North America did best with a volume increase of +13% week-over-week (Thanksgiving impact), while strongest decrease of -6% was measured on origin regions Africa, Asia Pacific and Middle East & South Asia.
The average worldwide yield/rate in week 48 increased compared with week 47.
Market Trends (15/11 - 28/11)
Global international air cargo capacity increased +2% in the last two weeks, through both belly and freighter increases. Growth of airline freighter cargo capacity has “slowed down” to +17%, as comparisons are now against the strong Q4 in 2019.
Recovery of air cargo capacity within Asia Pacific is driven by intra-Northeast Asia, which is +6% above 2019 levels. Capacity between Northeast Asia and Southeast Asia remains down ~10%.
As countries tighten travel rules over the Omicron variant, belly cargo capacity may fall again in the coming weeks. The impact of COVID’s new omicron variant on international belly air cargo capacity remains to be seen
Air Cargo Capacity
Commercial Flights Tracker
As of the 16th December 2021, 92 336 commercial flights were flown in the last seven days, compared to 69 957 and 112 699 in 2020 and 2019, respectively.
On a year-to-date basis, 29 039 481 commercial flights have been flown this year, 24% more than 2020 and 28% less than 2019.
Sea Freight
Cancelled Sailings - 16/12
Across the major trades: Transpacific, Transatlantic and Asia-North Europe & Med, 41 cancelled sailings have been announced between weeks 50 and 01, out of a total of 552 scheduled sailings, representing 7% cancellation rate. During this period 71% of the blank sailings will be occurring in the Transpacific Eastbound trade, and mostly to the West Coast.
Over the next 4 weeks, The Alliance has announced 19 cancellations, followed by 2M and Ocean Alliance with 7 and 5 cancellations, respectively. North European ports have been massively impacted by the Alliances drop of calls during the last 5 months, particularly Felixstowe, Rotterdam, Hamburg, and Antwerp.
Poor communication from shipping lines has been a major issue, leaving importers with no on-time information for their cargoes, which are often discharged at other ports than original shipping plan, while exporters suffer delays and additional terminal storage fees, as they await the next available sailing.
World Container Index (WCI)
The composite index increased marginally this week, and, remains 169% higher than a year ago.
The average composite index of the WCI, assessed by Drewry for year-to-date, is $7,520 per 40ft container, which is $4,751 higher than the fiveyear average of $2,769 per 40ft container.
Freight rates from Rotterdam – Shanghai grew 1% per 40ft box. Rates on Shanghai – Rotterdam, Shanghai – Genoa, Shanghai – Los Angeles, Los Angeles – Shanghai, Shanghai – New York, Rotterdam – New York and New York – Rotterdam hovered around previous weeks level. Drewry expects rates to remain steady in the coming week.
Global Schedule Reliability
Schedule reliability recorded another marginal improvement in October, of 0.4 percentage points to 34.4%, maintaining the range of 34%-40% seen throughout the year.
The only “positive”, if one should call it that, is that schedule reliability is not plummeting further.
On a Y/Y level, schedule reliability in October 2021 was down -18.0 percentage points. The average delay for late vessel arrivals also improved marginally, dropping to 7.34 days, albeit still the highest figure for this month, which has been a theme throughout 2021.
Carriers Share Performance
Capacity Outlook (week 49 - 8)
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