GDP plunged by 12.1% quarterly (40.3% annualized) in Q2. For the four largest eurozone economies, quarterly drops were: Germany 10.1%, France 13.8%, Italy 12.4%, and Spain 18.5%. It is the deepest recession on record for the region, dropping output to levels last seen in 2005. The drop was more severe than that of the USA.
Transatlantic demand continues to be hit by the pandemic, obliging carriers to extend blank sailings and putting rates under pressure. 2M partners, Maersk and MSC, announced last week they were extending the suspension of their TA4/NEUATL4 transatlantic loop to the end of September outbound from Europe, and to early October from the US. The loop, which has been suspended since May, deploys five vessels with an average capacity of 5,300 TEU.
TAWB – Rates have remained steady. There are no GRIs anticipated this month, however, due to blank sailings, capacity is still extremely tight. We strongly recommend placing bookings at least 3 weeks in advance of cargo ready date. TAEB – Similarly, rates have remained steady. There are no GRIs anticipated this month, but capacity is tight. We recommend placing bookings at least 2 weeks in advance of your cargo ready date.
The market appears to have stabilized, due to a slight capacity increase balanced by rising demand as economies reopen. However, with Europe in the midst of their summer holiday season, volumes are expected to decrease. In addition, pick-ups and deliveries within Italy will be highly impacted during the month of August as many trucking companies will close due to summer holiday. This will be especially true for pick-up/collection in the South of Italy, where dedicated truck service may be required at a much higher price.
Most carriers are moving forward with Aug 15 GRIs. Capacity for both WC and EC are still extremely tight, though WC has improved a bit due to extra loaders. If you’re experiencing issues with your service contracts, there are many options available. FAST BOAT options such as APL EXX, Matson, and ZIM ZEX service from South China have announced a PSS from Aug 1. This is expected to stay in place until the end of August, as there is more PPE movement shifting from Airfreight to fast boat options.
Capacity in the Indian sub-continent is very tight, fully booked up to 3 weeks in advance, due to blank sailings. Between capacity reduction and a shift in sourcing from China to India, the backlog will likely continue. We recommend scheduling bookings at least 3 weeks in advance. Space out of Malaysia, Vietnam, and Thailand is also tight. This is mainly due to the smaller capacity allocation as a result of blank sailings and surge of demand. Our recommendation is booking at least 2 weeks in advance.
Airfreight rates overall from China and Southeast Asia have rose about 40% compared to just 2 weeks ago. Capacity is tight out of China, Hong Kong, Taiwan, Malaysia, Vietnam, and India which is being driven by the surge in consumer tech, electronic, new product releases, and automotive. There are weekly charter options/services, if you’re in need of an alternative.
Steps Together Fund Raising Race
On September 5th, 2020, Masterpiece’s Gregoire Simonet will complete his 3rd Iron Man competition in Tallinn, Estonia while raising funds and awareness for Steps Together. Gregoire and Masterpiece are excited to be able to raise funds for Steps Together and look forward to reaching their goal before the race!