September Freight Market Update

September brings a new set of pressures layered on top of an already strained market. Weather-driven congestion at major Chinese ports, low water levels affecting both the Panama Canal and the Rhine and Danube rivers, and the run-up to China’s Golden Week and Mid-Autumn Festival holidays are all pushing rates higher across the transpacific and into Oceania. Capacity ex-China remains extremely tight, and carriers are managing supply closely on every lane covered in this update.

Ocean Freight, Australia

Healthy Capacity on Paper, Tight in Practice

August space from Asia into Oceania sat above 105,000 TEU of capacity in every week bar one, and September looks healthy on capacity as well. In practice, though, significant delays and congestion at major Chinese ports are already building due to weather conditions, and we anticipate a run of omissions at ports such as Shanghai this month. That creates a knock-on effect and a meaningful risk of rollovers even where headline capacity looks adequate.

Omissions Announced Across September

Maersk’s Qilin service and the A3 alliance’s ACX service both started last month and continue to run. Omissions from major Chinese ports, including Shanghai and Qingdao, have already been announced for the whole month of September. MSC’s Kangaroo service is suspended for the entire month, with further blanks from MSC’s Koala, Maersk’s Northern Star and Qilin, the A3X string, and the Panda/ZAX rotation spread across the final three weeks of September.

Access to Space

Space ex-China into Oceania should be expected to remain extremely tight for the whole of September. South East Asia is also seeing remarkably high demand, which has pushed FAK rates to elevated levels. We’re starting to see the first signs of equipment availability issues at major ports such as Ningbo.

Rates

The Drewry World Container Index has increased and then dipped over the past four weeks, currently sitting at 4,526 USD per 40ft. The Shanghai Containerised Freight Index shows the global index at 3,410 and the AUNZ index at 2,315 USD/TEU. Xeneta’s intelligence puts the Shanghai to Australia rate at approximately 2,432 USD/TEU, a raw freight rate excluding surcharges and local charges.

Carrier Performance

Average transit times to Sydney and Fremantle over the last three months remain uneven by string, with several services running noticeably behind schedule and cancellation rates as high as 58% on some rotations this month.

Ocean Freight, New Zealand

Capacity Remains Tight

Space out of the Far East into New Zealand remains tight this month. The A3X service (OOCL, ANL, COSCO) and Maersk’s Qilin service, both now running on the wider Asia to Oceania route, continue to help absorb some of the pressure, but typhoon season is still active and continues to cause port closures and further delays.

Access to Space

Space ex-China remains tight, with continued rollovers into Oceania. Frontloading, stock replenishment, and structural blank sailings and omissions from major carriers are all still contributing to elevated pressure, with typhoon season compounding the delay risk.

Fuel Adjustment Factor Continues to Climb

Following several months of reductions, average Fuel Adjustment Factor (FAF) rates on the Australia to New Zealand corridor have continued to increase in recent weeks. We’re monitoring this closely and will keep clients updated on any significant movement.

Rates

The Drewry World Container Index sits at 4,526 USD per 40ft. The Shanghai Containerised Freight Index shows the AUNZ index at 2,315 USD/TEU. Xeneta’s data puts the Shanghai to New Zealand rate at approximately 2,634 USD/TEU, a notable step up on last month and a raw freight rate excluding surcharges and local charges.

Carrier Performance

Average transit times to Auckland over the last three months have generally tracked close to schedule, with one string running a few days behind and a 25% cancellation rate on the COSCO/ML/ONE/OOCL rotation.

Ocean Freight, United States

1 September GRI Expected to Hold on Both Coasts

The 1 September GRI is expected to be successful for carriers on both the US East Coast and US West Coast. On the East Coast, rates continue to escalate due to tightly managed capacity, typhoon-related port congestion in China, and draft restrictions on the Panama Canal, with 12 blank sailings announced for the USEC and Gulf this month. On the West Coast, rates are climbing largely on weather and origin port congestion, and we expect the Panama Canal draft issues to push more cargo via the West Coast and onto rail. 13 blank sailings have been announced for the USWC in September, though 3 extra loaders have also been added to help clear the backlog.

Blank Sailings Continue Through September

Blank sailings are scheduled across both the US West Coast and US East Coast/Gulf through the weeks of 31 August, 7 September, 14 September and 21 September, with severity varying by week and region.

Access to Space

Space remains balanced to tight across Asia and India lanes into both coasts, with equipment availability tracking similarly. Air freight ex-China into the US remains the tightest mode this month.

Rates

The Shanghai Containerised Freight Index shows market rates from CNSHA at 6,765 USD/FEU to the US West Coast and 9,700 USD/FEU to the US East Coast, figures that reflect freight rates only and exclude BAF, PSS or other surcharges. Xeneta’s index shows average market rates from CNSHA at 5,377 USD/FEU to the West Coast and 8,353 USD/FEU to the East Coast, on the same surcharge-exclusive basis. Both indices are up sharply on last month.

Carrier Performance

Transit times to Los Angeles have generally held close to schedule over the last three months. Long Beach strings have been more mixed, including one rotation running more than two weeks behind its scheduled transit time. Several East Coast strings into New York/New Jersey have also run behind, with cancellation rates as high as 50% on some rotations.