Navigating the Shifting Tides: August 2022 Freight Market Update

Introduction

As we sail through the turbulent waters of the global freight market, August 2022 brings both challenges and opportunities for shippers and logistics professionals alike. In this comprehensive update, we'll explore the latest trends, market conditions, and strategic insights across ocean, air, and land transportation sectors. We'll also delve into how FreightAmigo's digital logistics solutions can help you navigate these complex market dynamics.

Let's dive into the key highlights from the August 2022 freight market:

• Ocean freight rates continue to decline, particularly in the Asia to North America trade lane
• Air freight demand remains soft across most regions
• Trucking capacity opens up in the US domestic market
• New customs regulations and trade compliance measures take effect
• Factory output and production face challenges in various key manufacturing hubs

Ocean Freight Market: Riding the Waves of Change

Asia to North America (Transpacific Eastbound)

The Transpacific Eastbound (TPEB) trade lane continues to see significant shifts in market dynamics:

• Spot rates are falling as carriers implement more blank sailings
• Schedule reliability remains low among major alliances
• On-street container dwell times are elevated, with inventory reaching maximum capacity at some inland locations
• Rail congestion persists in key hubs like Chicago, Dallas, and Memphis

For shippers navigating these waters, we recommend booking at least two weeks prior to your cargo ready date. This strategy can help you secure available space and take advantage of softer market rates. FreightAmigo's digital platform can assist you in comparing real-time rates and finding the most cost-effective options for your TPEB shipments.

Asia to Europe (Far East Westbound)

The Far East Westbound (FEWB) trade lane is experiencing its own set of challenges:

• Demand is slowing down, with no apparent peak season
• Supply remains tight due to blank sailings, vessel sliding, and port omissions
• Critical congestion levels at European ports, particularly Hamburg and Rotterdam, are causing further delays
• Potential power cuts in Ningbo (Zhejiang province) may affect production output

In this environment, flexibility is key. FreightAmigo's digital logistics platform can help you plan your shipments with greater agility, offering real-time visibility into vessel schedules and port conditions. This allows you to adjust your strategies as needed to minimize disruptions.

Europe to North America (Transatlantic Westbound)

The Transatlantic Westbound (TAWB) trade lane presents a mixed picture:

• August demand is expected to be lower due to European factory closures
• Anticipate a high return of demand beginning in September
• Congestion on the U.S. West Coast has improved, but some U.S. East Coast ports are experiencing worsening conditions
• Rates remain stable at high levels
• Equipment availability remains a significant challenge, especially in the Mediterranean region

To navigate these conditions, we recommend booking at least four weeks prior to your cargo ready date. Consider requesting premium services for higher reliability and no-roll guarantees. FreightAmigo's platform can help you compare different service options and find the best balance between cost and reliability for your TAWB shipments.

Air Freight Market: Clear Skies with Pockets of Turbulence

Asia

The air freight market in Asia is showing signs of softening:

• North China: Sufficient capacity for both Transpacific Eastbound and Far East Westbound lanes, with weak demand leading to rate decreases
• South China: Soft market demand for both TPEB and FEWB lanes, with slight rate decreases
• Taiwan: Soft market conditions with stable rates, despite political tensions
• Korea: Very slack demand with no signs of picking up
• Southeast Asia: Soft demand with rates maintaining similar levels

In this market environment, FreightAmigo's air freight solutions can help you identify cost-saving opportunities while ensuring reliable service. Our platform allows you to compare rates across multiple carriers and routes, enabling you to make informed decisions based on your specific needs and priorities.

Europe

The European air freight market is experiencing a lull:

• Demand continues to trend at lower levels
• Strong transatlantic belly capacity ex-European hubs is helping maintain lower rate levels
• Ground handling operations in major European hubs have improved compared to July
• Delays are expected at UK border crossings due to driver shortages

To optimize your air freight shipments from Europe, consider building pallets below 160cm to increase possibilities of better uplift options and rates on passenger aircraft capacity. FreightAmigo's digital platform can help you plan your shipments more effectively, taking into account these operational constraints and opportunities.

Americas

The air freight market in the Americas remains relatively stable:

• Export demand remains steady from all markets
• US airports are running at a normal pace
• Capacity is opening up further, especially into Europe
• Rates remain stable week over week
• Canadian airports (YYZ and YVR) are experiencing longer than normal dwell times for both import and export cargo due to heavy travel season

In this market, early booking remains crucial to secure the best uplift options and routings. FreightAmigo's platform can help you stay ahead of the curve by providing real-time visibility into capacity and rates across multiple carriers and routes.

Trucking & Intermodal: The Road Ahead

US Import/Export Trucking

The US trucking market continues to face challenges:

• Congestion persists at Montreal and Toronto terminals and inland ramps
• Chassis shortages continue, notably in Chicago, NY/NJ, Memphis, and LA
• East coast and gulf congestion is expected to continue through August
• LA/LB and Oakland ports have seen deteriorating conditions, partly due to AB5 strike action
• Highway diesel fuel prices are dropping but remain well above the start of year levels

FreightAmigo's digital logistics platform can help you navigate these complexities by providing real-time visibility into trucking capacity, rates, and transit times. This allows you to make informed decisions and optimize your inland transportation strategies.

US Domestic Trucking

The US domestic trucking market is showing signs of softening:

• The market has been affected by high inventory/sales ratios, global inflation, high diesel fuel prices, and a sharp drop in container imports
• Tender rejections by carriers have decreased by 67% year-over-year
• Spot rates have bottomed out to a 16-month low, down ~35% year-to-date
• Load-to-Truck ratios are down ~30% year-over-year
• Tender volumes from customers are down 20% year-over-year

In this evolving market, FreightAmigo's digital solutions can help you take advantage of the increased capacity and lower rates. Our platform allows you to compare rates across multiple carriers and find the most cost-effective options for your domestic shipments.

Customs and Compliance: Navigating the Regulatory Landscape

Several important regulatory changes are taking effect:

• CTPAT Trade Compliance program has reopened to new members, with new rules including expanded compliance obligations around forced labor
• The U.S. International Trade Commission (USITC) has announced a new fact-finding investigation on the USMCA automotive rules of origin
• CBP has announced new public-private partnerships to expand services at ports of entry

Staying compliant with these evolving regulations can be challenging. FreightAmigo's digital platform includes features to help you manage customs documentation and compliance requirements more efficiently, reducing the risk of delays or penalties.

Factory Output: Global Production Challenges

Key manufacturing hubs are facing various challenges:

• China: China-Europe freight trains are breaking new records in numbers and volume
• Vietnam: Over 100 Vietnamese international flights affected by China's military drills near Taiwan
• Cambodia: The country's first $300M tire factory highlights growing production capacity
• India: Ford India's manufacturing plant to be sold to Tata Motors
• Bangladesh: Demand for RMGs continues to drop due to inflation
• Pakistan: Maersk and Seed Ventures sign MOU to improve agricultural produce quality and expand export network

These production challenges can have ripple effects throughout the supply chain. FreightAmigo's digital platform can help you stay informed about these developments and adjust your sourcing and shipping strategies accordingly.

Conclusion: Charting Your Course with FreightAmigo

As we navigate through these complex and ever-changing market conditions, having a reliable and agile logistics partner is more crucial than ever. FreightAmigo's digital logistics platform is designed to help you weather these storms and seize opportunities in the freight market.

Our comprehensive suite of digital solutions empowers you to:

• Compare real-time rates across multiple carriers and modes of transport
• Book and manage your shipments with greater efficiency and transparency
• Track your cargo in real-time, from origin to destination
• Manage customs documentation and compliance requirements more effectively
• Gain valuable insights into market trends and optimize your logistics strategies

By leveraging FreightAmigo's digital logistics platform, you can turn these market challenges into opportunities for growth and efficiency. We're here to help you navigate the complexities of global trade and emerge stronger in this dynamic freight market.

Stay informed, stay agile, and let FreightAmigo be your trusted partner in navigating the ever-changing seas of global logistics.