December 2023 – Market Update

AIR

• The USA air market is relatively stable for this time of the year, with capacity generally available and no significant delays.
• Jet Fuel Prices are trending downward, with some airlines beginning to reflect the change in their fuel surcharge.

OCEAN

Panama Canal:

The conditions at the Panama Canal are worsening, leading to significant delays for vessels without reservations. The daily reservation slots, initially 32 at the start of November, have decreased to 22 as of December 1. This number will be reduced to 18 slots daily starting February 1, 2024. In response to these challenges, numerous carriers are opting to reroute their vessels through the Suez Canal as an alternative, although this route will contribute to longer transit times. Also, there’s been an uptick of vessels using the Ports of Los Angeles and Long Beach. As a result, it is essential for customers to make adjustments to their supply chain schedules to mitigate potential delays in the future.

EU ETS to Increase Freight Rates by as Much as 5% 

The shipping sector is experiencing a substantial shift driven by climate regulations set forth by the United Nations Maritime Organization (IMO) and regional efforts. Numerous shipping companies have declared additional charges for journeys to and from European Union (EU) ports, with an average of approximately USD 30 per TEU. 

In the new year, shipping will be integrated into the EU’s Emission Trading System (ETS), incurring a cost ranging from 1-5% of freight rates. The EU’s ETS requires shipping firms to offset their CO2 emissions specifically on EU-related routes, encompassing roughly one-third of the global container trade.

 Global Schedule Reliability Unchanged at 64.4% in October 

Global schedule reliability remained unchanged from September to October 2023, holding steady at 64.4%. Since March 2023, schedule reliability has consistently stayed within a two-percentage-point range, except for a notable increase in May. In a year-on-year comparison, there has been a noteworthy improvement of 12.6 percentage points in schedule reliability.

Click on the link below for more information on ocean!

December U.S. Port and Rail Status Update