Latest news with #Drewry
Fibre2Fashion
3 days ago
- Business
- Fibre2Fashion
Global container rates surge 10% as US tariff pause spurs demand
The Drewry World Container Index (WCI)—a composite measure of container freight rates—shot up further by 10.19 per cent to $2,508 per 40-foot equivalent unit (FEU) on May 29, up from $2,276 per FEU the previous week. The index has increased 21 per cent in the last 3 weeks, as President Donald Trump's 'pause' on import tariffs led to a resumption of US-bound traffic after the initial collapse of trans-pacific volumes. The freight rates from Shanghai to Los Angeles have jumped 17 per cent to $3,738 per 40ft container in the past week and 38 per cent since May 8 (3 weeks ago). Spot rates to New York have risen 14 per cent in the past week and 42 per cent in the past 3 weeks. The Drewry World Container Index surged 10.19 per cent to $2,508 per FEU, marking a 21 per cent rise in three weeks as Trump's tariff pause spurred US-bound traffic. Rates from Shanghai to LA and New York soared up to 42 per cent. While this marks the first double-digit gain since July 2024, Drewry warns spot rates may decline again in H2 due to weak demand. During the week, freight rates from Shanghai to Rotterdam and Genoa have also risen by 6 per cent and 3 per cent, respectively. This was the first double-digit rise in the composite index since July 2024. The latest sudden, short-term strengthening in supply-demand balance in global container shipping has reversed the trend of declining rates which had started in January this year. However, Drewry's Container Forecaster expects the supply-demand balance to weaken again in the second half, which will cause spot rates to decline again in the second half of this year. The volatility and timing of rate changes will depend on the outcome of yesterday's legal challenges to Trump's tariffs and on capacity changes related to the introduction of the US penalties on Chinese ships, which are uncertain. Fibre2Fashion News Desk (KUL)
Fibre2Fashion
4 days ago
- Business
- Fibre2Fashion
Europe's ports face delays amid labour shortages, strikes
Port congestion is intensifying across major global trade routes, with Northern Europe's key hubs—including Antwerp, Rotterdam, Hamburg, and Bremerhaven—facing escalating backlogs and severe inland transport disruptions, according to Drewry. Bremerhaven has been particularly affected due to labour shortages during the recent holiday period, while low water levels on the Rhine have curtailed barge capacity out of Antwerp and Rotterdam, compounding logistical strain. Port congestion is worsening across key hubs in Northern Europe and major global ports like Shenzhen, Los Angeles, and New York, driven by labour shortages, strikes, and inland transport issues. Berth waiting times and logistics costs are rising sharply. Carriers are imposing surcharges, while spot rates surge amid an early peak season influenced by USâ€'China tariff uncertainty. At the Port of Antwerp-Bruges, operations were further strained by a nationwide strike on May 20, which temporarily disrupted vessel traffic. Kallo and Boudewijn Locks were affected, with Boudewijn Lock later restored to full operation by the evening. Although the impact was short-lived, it added pressure to already congested conditions across the region, maritime research and consulting firm Drewry said in its Logistics Executive Briefing. Berth waiting times reflect the severity of the congestion. At Antwerp, average waiting time rose from 32 hours in Week 13 to 44 hours in Week 20—a 37 per cent increase. Hamburg witnessed a 49 per cent jump from 34 to 50 hours, while Bremerhaven saw a 77 per cent surge over the same period. These port delays are having a cascading effect across the supply chain. Supply chain reliability is falling, logistics costs are climbing, and inland transport is becoming increasingly complex. The congestion is not confined to Europe alone. Similar trends have emerged in Shenzhen, Los Angeles, and New York, where the number of containerships waiting to berth has steadily increased since Week 17. At peak levels, up to 50 ships were waiting in Shenzhen, 42 in Los Angeles, and 14 in New York. Extended port delays are stretching transit times, disrupting inventory planning, and forcing shippers to carry surplus stock. Carriers are responding with rerouting strategies and congestion surcharges. Mediterranean Shipping Company (MSC), for example, is set to implement a congestion surcharge from June 1 on all shipments from Northern Europe to the Far East, further elevating freight costs, added the report. The strain is compounded by a potential early peak season in Transpacific eastbound trade, driven by a temporary 90-day pause in US—China tariffs, which expires on August 14. As a result, container spot rates have surged 27 per cent since early May. Rates from Shanghai to Los Angeles climbed from $2,590 on May 1 to $3,197 by May 22, 2025, according to Drewry's World Container Index (WCI). Similarly, rates to New York rose from $3,500 to $4,527 in the same period. General Rate Increases (GRIs) were successfully implemented on May 15, 2025, with additional GRIs and Peak Season Surcharges (PSSs) scheduled for June 1, 2025. The worsening congestion underscores the vulnerability of container shipping to disruption and reinforces the urgent need for resilient, adaptive supply chain strategies. In such a volatile landscape, access to real-time market insights—covering key indicators such as port congestion, blank sailings, and capacity—is critical for cargo owners seeking to make informed decisions, mitigate risks, and navigate continued uncertainty effectively, said Drewry. Fibre2Fashion News Desk (SG)
Epoch Times
5 days ago
- Business
- Epoch Times
US-China Tariff Truce Triggers Cargo Stampede, Scramble to Diversify Beyond China: Analysts
News Analysis When word broke on May 12 that Washington and Beijing had agreed to a 90-day tariff pause, containers quickly piled up at Shenzhen's Yantian International Container Terminal, the port that handles more than a quarter of U.S.-bound cargo. U.S. duties dropped from 145 percent to 30 percent and China's from 125 percent to 10 percent. Within a day, rows of outbound boxes jammed major Chinese docks, carriers were peak-season surcharges for sailings weeks before summer, and spot rates on the Pacific began to soar. The tariff reprieve expires on Aug. 11. If negotiators fail to reach a broader deal by then, tariffs of up to 54 percent could snap back into place. Analysts say the 90-day truce offers only a brief lifeline. It has locked in a new playbook of rush shipping, floating-tariff contracts, and multi-country production hedges that will outlast the reprieve. Far from reversing the trend, it reinforces the supply-chain exodus that began in Trump's first term and has accelerated in the current one. Average weekly bookings from China to the United States Related Stories 5/18/2025 5/26/2025 Drewry's index shows May 15 spot rates on the Shanghai–Los Angeles lane 'There won't be enough ships for all this cargo. Get ready for surge pricing,' shipping firm Flexport chief executive Ryan Petersen 'The 90-day reprieve simply resets the clock,' U.S.-based economist Davy J. Wong told The Epoch Times. 'We've moved from 'deal or no deal' to chronic confrontation. High tariffs could remain as the baseline, and exemptions become the bargaining chips.' Washington, he added, can raise or lower duties at will, using them as a lever whenever Chinese industrial policy shifts, the yuan slides, or U.S. inflation flares. A lasting thaw of U.S.-China trade tensions 'seems unlikely anytime soon,' Sun Kuo-hsiang, an international affairs professor at Taiwan's Nanhua University, told The Epoch Times. Each pause-and-rebound cycle, he said, nudges more factories abroad and pushes the higher-margin plants that stay to automate—auto-parts lines already swapping workers for robotic welding arms, appliance makers rolling out smart assembly cells. Ports Jammed, Contracts Rewritten The port crunch is already rippling through carrier operations. With Yantian berths booked solid, German carrier Hapag-Lloyd Exporters are betting on speed. An aerial view shows containers stacked at a port in Taicang, in eastern China's Jiangsu province on May 18, 2025. STR/AFP via Getty Images Chinese factories are clearing backlogged inventory, high-margin goods, and holiday merchandise first, Sun said, with long-term orders from major U.S. retailers taking priority. Wong calls the tactic 'ship early and stockpile on the U.S. West Coast'—a reversal of the usual pattern in which U.S. importers build inventories. This time, Chinese exporters are sending even unsold cargo across the Pacific to beat the clock. If duties return in August, cargo still in transit could be rerouted through Mexico or Southeast Asia for repackaging, dumped into China's domestic market, stripped for parts, or written off if margins vanish, Wong said. Buyers and sellers are redrafting deals just as fast, he added. He said contracts now feature floating-tariff clauses, shorter payment terms, , and non-deliverable forwards—currency contracts to cushion any slide in the yuan that new tariff headlines could trigger. Sun sees more pay-on-delivery schedules, and explicit cost-sharing formulas when duties change, with tighter termination clauses: 'These instruments are now routine for mid- to large-size exporters.' Insurance markets have responded in kind: war and political risk premiums, elevated since the Red Sea attacks, now Factories on the Move Producers across the Pacific offer a snapshot of how the 90-day truce is accelerating an old trend. Limoss, a German maker of remote-control systems based in the Chinese manufacturing hub of Dongguan, is seeking to expand operations in Malaysia for U.S. orders because 'crossing our fingers isn't a strategy,' general manager Christian Gassner That calculation echoes up and down the value chain. Japanese heavy machinery maker Komatsu Chinese-made cars, including Volvo and other brands, at a port in Nanjing, in China's eastern Jiangsu province on April 16, 2025. AFP via Getty Images The pivot has been underway for years: by 2024, Vietnam was making half of Nike's shoes, nearly a third of its apparel, 40 percent of Lululemon products, and 39 percent of Adidas footwear—evidence of how first-term Trump tariffs set global supply chains in motion. A veteran Chinese paper-goods maker surnamed Chen Vietnam itself was briefly subjected to a 46 percent U.S. reciprocal tariff, but that duty has been suspended at a 10 percent baseline since April 9. U.S. retailers are adjusting, too. Target is 'treasure-hunt' model—constantly rotating product offerings—to swap in lower-tariff goods. Automation, 'China + 1' Surge Sun pegs 2024 to 2026 as the critical window for 'China + 1' migration, keeping a foothold in China while adding at least one production base elsewhere to hedge risk. Electronics, apparel, toys, and home-appliance makers are leading the charge to Vietnam, Mexico, and Indonesia. Higher-tech firms are splitting new investment between China and alternative sites, he said. Beijing's counter‐move is rapid If robots and smart controls can cut unit costs far enough, a handful of high-margin lines might stay despite duties—but Sun concedes most plants can't make the numbers work once U.S. tariffs approach 40 to 50 percent. Either way, the trade-off is fewer jobs at home. An employee moves parcels from a conveyor belt to an automatic robot at the warehouse of a logistics base of JingDong Group in Wuhan, Hubei province, China, on November 5, the push is official policy. Under its Made in China 2025 blueprint, Beijing wants domestic makers of robots and control systems to capture 70 percent of the home market by 2025. Sun expects automation to spread first in higher-margin segments such as auto-parts machining, large-appliance assembly, and the production of industrial PCs and other embedded controllers. Wong sees the second China + 1 wave cresting in late 2025 as higher-value industries lean into automation, digital twins, and local fulfillment networks to stay nimble. Bottlenecks for the US, Risks for China The scramble carries risks beyond freight rates, Wong said. China still dominates specialty chemicals, active pharmaceutical ingredients, precision machine-tool parts, and rare-earth magnets, he said. Even brief delays can idle U.S. plants for months. At the same time, the capital that keeps this trade moving is just as exposed to shocks, Sun said. Much of the rush is bank-financed, Sun added. Short-term loans fund the inventory, and if demand falters, unsold stock becomes 'a liquidity black hole' for small and mid-size exporters. Chinese lenders have already Wong fears a wave of non-performing loans at Chinese regional lenders that specialize in trade finance. S&P Global Conversely, if tariffs jump in August, Wong foresees 'localized, industry-specific layoffs' in export-heavy Chinese hubs like Guangdong and Jiangsu as early as September. Factories lacking branding and domestic conversion channels would start shedding workers first, he added. Labor-intensive workshops in toys, apparel, and small appliances are already trimming shifts, Sun said. Carriers Eye Exit For ocean carriers, Wong said, the calculus is simple: if demand collapses after August, ships will stay in port despite low fuel prices. New contracts penalize shippers that default on minimum-load commitments, Sun noted, yet without steady volumes, even penalties may not keep vessels running. The Trump administration warns higher tariffs will return unless Beijing concedes more ground. A China Shipping cargo container sits stacked at the Port of Long Beach in Long Beach, Calif., on April 10, 2025. Patrick T. Fallon/AFP via Getty Images For now, ships race the calendar. 'The pause-and-rebound cycle is likely here to stay,' Wong said. Sun echoed the view: every truce triggers a rush to ship, a spike in rates, and a fresh round of hedging. Businesses on both shores are behaving as if the era of predictable low tariffs is over, Wong added. They are padding inventories, rewriting contracts, and uprooting supply chains, not for a one-off crisis but for a future in which trade peace lasts only as long as the next 90-day clock. Gu Xiaohua and Reuters contributed to this report.
Yahoo
7 days ago
- Business
- Yahoo
Shipping Bottlenecks in Europe Send a Warning to US, Asia
(Bloomberg) -- Supply Lines is a daily newsletter that tracks global trade. Sign up here. NY Private School Pleads for Donors to Stay Open After Declaring Bankruptcy UAE's AI University Aims to Become Stanford of the Gulf NYC's War on Trash Gets a Glam Squad Pacific Coast Highway to Reopen Near Malibu After January Fires Port congestion is worsening at key gateways in northern Europe and other hubs, according to a new report which suggests trade wars could spread maritime disruptions to Asia and the US and push up shipping rates. Waiting times for berth space jumped 77% in Bremerhaven, Germany, between late March and mid-May, according to the report Friday from Drewry, a maritime consultancy in London. The delays rose 37% in Antwerp and 49% in Hamburg over the same stretch, with Rotterdam and the UK's Felixstowe also showing longer waits. Labor shortages and low water levels on the Rhine River are the main culprits, hindering barge traffic to and from inland locations. Compounding the constraints is US President Donald Trump's temporary rollback on 145% tariffs on Chinese imports, which has pulled forward shipping demand between the world's largest economies. 'Port delays are stretching transit times, disrupting inventory planning and pushing shippers to carry extra stock,' Drewry said. 'Adding to the pressure, the transpacific eastbound trade is showing signs of an early peak season, fueled by a 90-day pause in US–China tariffs, set to expire on Aug. 14.' Similar patterns are emerging in Shenzhen, China, as well as Los Angeles and New York, 'where the number of container ships awaiting berth has been increasing since' late-April, it said. Rolf Habben Jansen, chief executive officer of Hamburg-based Hapag-Lloyd AG, said on a webinar last week that, although he's seen recent signs of improvement at European ports, he expects it will take 'another six to eight weeks before we have that under control.' Still, Torsten Slok, Apollo Management's chief economist, pointed out in a note on Sunday that the US-China tariff truce reached almost two weeks ago hasn't yet unleashed a surge in ships across the Pacific. 'This raises the question: Are 30% tariffs on China still too high? Or are US companies simply waiting to see if tariffs will drop further before ramping up shipments?' Slok wrote. EU-US Dispute US tariffs – combined with sudden threats and truces – make it difficult for importers and exporters to calibrate their orders, causing unseasonal swings in demand. For shipping lines, those translate into delays and higher costs requiring freight rate hikes. The latest blow to visibility came Friday, when Trump threatened to hit the European Union with a 50% tariff on June 1. He reversed course over the weekend, agreeing to extend that deadline to July 9 after a phone call with European Commission President Ursula von der Leyen. With just over six weeks until higher tariffs potentially kick in, transatlantic cargo volumes should get a boost because 'shippers have an even higher incentive to move whatever they can to the US before it hits,' said Emily Stausbøll, a senior shipping analyst at Xeneta, a digital freight platform based in Oslo. The added policy uncertainty 'will be a deadweight cost to global activity by adding risks to decisions on expenditures,' Oxford Economics said in a research note on Saturday. Germany, Ireland, Italy, Belgium and the Netherlands are the most vulnerable given their ratios of US exports to GDP, it said. Bloomberg Economics said in a research note Friday that 'additional tariffs of 50% would likely reduce EU exports to the US for all products facing reciprocal duties to near zero — cutting total EU exports to the US by more than half.' GLOBAL REACT: What Trump's 50% Duty Threat Means for 'Nasty' EU Mounting uncertainty about whether Trump would follow through on such a big trade threat or postpone it like he did with China is adding to shipping pressures. Carriers including MSC Mediterranean Shipping Co., the world's largest container line, had already announced general rate increases and peak season surcharges, starting in June, for cargo from Asia. In the weeks ahead, those are likely to boost spot rates for seaborne freight, the cost of which is still underpinned by geopolitical turmoil. Cargo ships are still largely avoiding the Red Sea, where Yemen-based Houthis started attacking vessels in late 2023, and sailing around southern Africa to ferry goods on routes that connect Asia, Europe and the US. Avoiding 'Massive Congestion' On the webinar, Habben Jansen said it's still not safe to traverse the Red Sea and indicated that any eventual restoration of regular journeys through the Suez Canal would have to be gradual, perhaps taking several months, to avoid flooding ports with vessel traffic. 'If we would from one day to another shift those ships back through Suez, we would create massive congestion in many of the ports,' Habben Jansen said. 'So our approach would be that if we can do it, that we do it over a longer period of time so that the ports do not collapse, because that's in nobody's interest.' --With assistance from Richard Bravo. (Adds comments on transatlantic cargo in 11th paragraph) Why Apple Still Hasn't Cracked AI How Coach Handbags Became a Gen Z Status Symbol AI Is Helping Executives Tackle the Dreaded Post-Vacation Inbox Inside the First Stargate AI Data Center Anthropic Is Trying to Win the AI Race Without Losing Its Soul ©2025 Bloomberg L.P. 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First Post
7 days ago
- Business
- First Post
Trump tariffs to Houthi attacks, world has a new trade headache: The long wait for ships to dock
European port congestion is surging (Bremerhaven up 77%), driven by labour shortages, Rhine low water and a US-China tariff truce. Global supply chains face rising costs, Red Sea diversions and new US tariff threats. read more Port congestion at major European hubs is intensifying, with ripple effects threatening global supply chains and shipping costs. According to a recent report by maritime consultancy Drewry, waiting times for berth space surged significantly between late March and mid-May: Bremerhaven experienced a 77% increase, Antwerp 37%, and Hamburg 49%. Rotterdam and the UK's Felixstowe also reported extended delays. These disruptions are primarily attributed to labour shortages and low water levels on the Rhine River, which have hampered barge traffic to and from inland locations. STORY CONTINUES BELOW THIS AD Compounding these challenges, the temporary rollback of 145% tariffs on Chinese imports by US President Donald Trump has accelerated shipping demand between the world's largest economies. This surge is evident in the transpacific eastbound trade, which is showing signs of an early peak season, fuelled by a 90-day pause in US–China tariffs set to expire on August 14. Similar congestion patterns are emerging in Shenzhen, China, as well as Los Angeles and New York, where the number of container ships awaiting berth has been increasing since late April. Rolf Habben Jansen, CEO of Hamburg-based Hapag-Lloyd AG was quoted by Bloomberg as saying that while there are recent signs of improvement at European ports, it may take another six to eight weeks before the situation is under control. He emphasised the need for a gradual restoration of regular journeys through the Suez Canal to avoid overwhelming ports with vessel traffic, suggesting that a sudden shift could create massive congestion. In the United States, the tariff truce with China has not yet led to a significant increase in trans-Pacific shipping. Torsten Slok, chief economist at Apollo Management, questioned whether existing 30% tariffs on China remain too high or if U.S. companies are waiting to see if tariffs will drop further before ramping up shipments. Meanwhile, the trade landscape remains volatile. President Trump recently threatened to impose a 50% tariff on European Union goods starting June 1, a move that could severely impact transatlantic trade. However, following a conversation with European Commission President Ursula von der Leyen, Trump agreed to delay the implementation until July 9 to allow for further negotiations. This announcement provided temporary relief to markets, with European shares and US futures experiencing gains. STORY CONTINUES BELOW THIS AD Despite this delay, the threat of increased tariffs continues to create uncertainty for importers and exporters, making it difficult to plan orders and causing unseasonal swings in demand. Shipping lines are facing delays and higher costs, leading to freight rate hikes. Carriers, including MSC Mediterranean Shipping Co., have already announced general rate increases and peak season surcharges starting in June for cargo from Asia. Adding to the complexity, cargo ships are still largely avoiding the Red Sea due to ongoing attacks by Yemen-based Houthis, opting instead to sail around southern Africa. This longer route affects goods transported between Asia, Europe, and the US, further straining global shipping networks. As the situation evolves, stakeholders throughout the supply chain are closely monitoring developments, aware that the interaction of port congestion, labour shortages, and geopolitical tensions could have lasting impacts on global trade dynamics.
