Why the recent surge in sea freight?
The reasons for the recent surge in sea freight mainly include the following:
- Insufficient transport capacity : Due to a variety of factors, including the detour effect caused by the situation in the Red Sea, the capacity gap caused by container ships' detour, etc., resulting in insufficient transport capacity, which has pushed up sea freight rates.
- Supply and demand imbalance : On the one hand, there is a shortage of capacity supply, and on the other hand, there is a recovery in market demand, especially in emerging markets such as South America and Bohong routes.
- Rising operating costs : Additional costs, including new carbon charges and vessel rerouting, are also driving up sea freight rates.
- Geopolitical factors: Tensions in the Red Sea have forced ships to circumnavigate the Cape of Good Hope in Africa, which not only increases the distance and time of the voyage, but also raises the cost of transportation.
- Changes in foreign trade demand : Increased demand in some emerging markets such as South America and Bohong routes has pushed up the overall freight rate. For example, freight rates from the Far East to South America continue to soar, becoming a key force driving up overall freight rates.
- Increased demand for restocking : Turmoil around the world has led buyers to prefer to maintain inventories at high levels to cope with possible risks and challenges. This shift from the destocking trend of the past two years to a short-term increase in trade demand.
To sum up, the background of the surge in sea freight is the result of a combination of factors, including insufficient transportation capacity, supply-demand imbalance, rising operating costs, geopolitical factors, changes in foreign trade demand, and rising demand for restocking.
