Air and Sea Freight Market Update

As of this month, there have been several updates with concern to the air  and sea freight market. End of November is considered extremely important concerning Christmas deliveries. Delays have been noted this year as well, often with east to west trades and transactions experiencing minor delays which can mean that shipping cut-off dates are missed. That would mean that manufacturers will need to shift from their sea freight mode of shipping to a multi-modal model of air and sea freight to ensure that delivery deadlines to retailers are made in time. Whether its sea and air, to only air freight, these minor delays can show significantly on the bottom line.

Unfortunately for many of us in the world, this has been a recurring issue due to the pandemic, and not just for the Christmas rush. Port congestions are the biggest disruptor in the air and sea freight market, from customs bottlenecks due to employee shortages, trucking shortages, and especially changes in demand from various parts of the world looking for alternatives due to material shortages. Capacity constraints are still in place due to the volatile supply chain issues present in the market.

Further, the electricity rationing that is occurring in different parts of China has also affected how supply chain occurs due to delays in getting goods ready through the chain. Experts have provided means of mitigation the risks/hits caused by this to lessen the impact on the supply chain. These include the likes of close monitoring of supply chain operations and adjusting manufacturing and logistics schedules accordingly, as well as regular communications with suppliers and vendors in order to mitigation electricity disruptions and their fallout in real time.  Further, maintaining constant communication with the shipper can also help in finding solutions to prevent further delays in the logistics and freight component of the supply chain.

Big name shippers such as Maersk moving in and expanding into the air freight market will launch them into a greater status as a multi-modal shopper, with a growing air and sea freight market and expanding its multi-modal network of rail, warehousing, distributing and packing services across the world.

Sea freight wise, carrier capacity will remain limited well into Q2 of 2022, even though demand remains steady, there have been demand fluctuations in certain areas of the world. The backlog of freight due to capacity impositions will maintain trade and air and sea freight at full capacity.