Dear Valued Customer,
Yesterday, the President announced an unprecedented travel ban from most of Europe. U.K., Ireland and non-Schengen countries will remain unaffected. Though the President originally indicated the ban would “apply to the tremendous amount of trade and cargo”, the White House has since clarified that cargo is not included . Moments ago, the DOT Aviation has also confirmed the same. The ban currently applies to the movement of people, not goods or cargo. Only exception will be airline personnel traveling aboard freighters, who will be following additional CDC protocols.
- Though cargo is not included in the ban, it will have a significant impact on airfreight between the U.S. and effected EU countries. As airlines eliminate passenger aircraft services, capacity will be limited in these lanes.
- Airfreight rates are expected spike.
- Germany, France, and the Netherlands will face the greatest impact as they have the most passenger flights to/from the U.S. Other high frequency lanes are Spain, Switzerland, Italy, Portugal, and Turkey.
- Regardless of these capacity issues, there are still many options and alternatives available. Our experienced airfreight teams throughout the U.S. and Europe are constantly communicating with our vendor partners and agents to provide you with the necessary solutions.
- Repetitive blank sailings on Far East Inbound Trade have caused a shortage of reefer containers and standard equipment in inland depots in the U.S. and Europe.
- Due to shortage of equipment, carriers have started implementing Equipment Imbalance Surcharges.
- GRI’s have also been announced from the North West Continent and West Mediterranean to the U.S.
The situation in China appears to be controlled at the moment, and new cases are dropping. This relative improvement has slowed the total cases to roughly 80,000. As provinces and companies have come back online, production has recovered significantly. However, for many, finding the necessary raw materials is still a challenge.
- Ocean carrier has extended the rates from March 1 to March 15.
- Demand from China is slowly building-up; however the current available capacity is able to handle the request without any capacity issues even with blank sailings.
- As the market is predicting heavy demand by end of March, carriers are expected to announce GRI starting from March-15 in between $300-400’F.
- Carriers are very careful in announcing the GRI as each carrier is waiting to see the actions of their competitors. We are expecting GRI announcements will be available after March 14.
- – Carriers are still considering extra loaders in April, as demand is anticipated to spike.
- – Airfreight market is in disarray with the cancellation of almost 60% of passenger flights by U.S., Asian carriers, and now the EU carriers.
- – Capacity ex-China and ex-Hong Kong is almost full, any new booking requires 3-4 days booking in advance.
- Rates from China to North America increased by 35%, and 18% to Europe. Airlines are increasing the rates every 2 days depending on the capacity. As of today, average rates from China to North America is $ 5.06/kg.
- Air demand is expected to increase until late April, and rates are expected to increase as well. With a lot of air carriers suffering with the loss of revenue from the passenger flights, they are expected to take full advantage of the situation.
- Demand of charter flights has increased with major U.S. importers already booking charters for the next couple of weeks.
- Airfreight rates are also increasing from other origins in Asia. We have seen general rates ex-Singapore, Malaysia, Vietnam, Indonesia, and even India increase by at least 20% due to the limited capacity, as majority of carrier are only operating freighter flights.
How Masterpiece Can Help:
Masterpiece International is committed to assisting its clients through any supply chain and logistics irregularities at this time. For shipments with time-critical needs, we have alternative transport and route solutions to alleviate any pressure points. Please ask about Charters, Expedited Air Freight Expedited FCL, and Sea-Air services. Please reach out to your local branch to learn about solutions for your situation.
Please contact your local Masterpiece representative with any questions.