By Richie Lin     Photo：Tom Fisk，Link：Pexels 

The popularity of e-commerce and QE by major central banks are two engines to boost the economy in 2020 and 2021, also change the minds of logistics industries.

Ocean freight rate reference in week 48:

News said the profit margins of all carriers in third quarter of 2021 surpassed the combined profit margins of technology companies such as Google, Facebook, Tesla. This is an unbelievable phenomenon and broke the stereotypes about logistics business. In the past, carriers, airlines, forwarders are at the bottom of supply chain, so they can only make minimum margins and try to increase bigger volumes to survive. However, covid-19 shattered the balance of supply and demand of ocean freight and airfreight industries. When the Covid-19 began to outbreak in the early 2020, carriers and airlines cut their capacity to reduce cost for economy breakdown. Unlike the situation of SARS in 2003, ecommerce has changed the habits of consumers, people don’t need to really go out to buy products. Even people at home they still can surf online to buy whatever they want and wait at homes to receive products. The popularity of e-commerce and QE by major central banks are two engines to boost the economy in 2020 and 2021, also change the minds of logistics industries.

People can purchase online but products cannot go to customers through internet. Carriers, airlines, forwarders, brokers, truckers are still the irreplaceable last mile from online to offline. When cargo kept flooding into USA for the fulfillment of inventory, port congestions, labor shortage in ports and airports, lack of chassis got worse by worse and became an unsolvable gridlock. This Gridlock made carriers to use blank sailing from time to time to avoid vessels stuck at some ports and the blank sailings pushed up the rate because supply and demand are shattered again. In December 2021, we can foresee carriers will use blank sailings to keep up the rate, and will also use this option to keep rate up after the pandemic goes down in the near future. Carriers have changed their minds and will no longer cut their blood to fight for cargo to fill their loads.

Following rate reference in week 48.

• Asia main ports to USAWC USD 10000~12000 per 40GP; 
• Asia main ports to USAEC USD 14500~16500 per 40GP; 
• Asia main ports for IPI points of USA is USD 18500~22500 per 40GP.

Please note above rate is only for reference, carriers might only give space for higher rate, which will be from USD 15,000~25,000 per 40GP for different destinations.

Airfreight market rate in Week 48:

The airfreight is updated each week to match the market situation. The following market rate for your reference. 

• PVG/SZX/HKG/TPE to LAX USD 20.0/kg, 
• PVG/SZX/HKG/TPE to ORD USD 20.0/kg, 
• PVG/SZX/HKG/TPE to JFK USD 23.0/kg. 

Airfreight rate will keep increasing in December because ocean freight is too late for Christmas products to be put on shelves of stores on time.

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