Freight Market Update

01 December 2023
by Sam Cullen

Table of contents

By Sam Cullen
Published: 01/12/23
Last Edited: 01/12/23

Topic of the week:

As the Panama Canal drought continues to worsen, vessels opt to divert to Suez Canal routes, while other ocean carriers are looking for growth opportunities in north-south trade routes.

The usual East-west trade routes have become oversupplied in recent times, pushing some carrier to explore other alternatives in north-south routes. Growth has been seen along African, Latin American and Indian trade routes over the last year. Indian exports grew 15% to $453 billion from last year according to the World Trade Organisation, whilst Latin American trade experienced growth of 17.5% over the last year. Latin American capacity increased by 562,000 teu. Finally, the highest growth increase was seen by African trade services which increased capacity by 354,000 teu, a 21.1% increase as of November 1st compared to last years figures.

Carriers such as Zim and ONE have already started taking advantage of this growth. Zim has launched two new services connecting China and South Korea to the South American West Coast, as well as the East Coast of South America to the USA. ONE has also been influenced, and have recently announced that they will be introducing a new service between India and the USA East Coast, consisting of a fleet of nine vessels that is specifically designed to combat the increased exports demand for consumer goods.

Meanwhile, the restrictions that have been placed to conserve the dwindling water levels along the Panama Canal continue to tighten forcing more carriers to impose a Panama Canal surcharge, Hapag-Lloyd and Cosco being the most recent to join the trend. The maximum draught along the Panama Canal has once again been reduced from 14.9 metres to 13.4 metres. Daily transits have also been reduced to 22 with further plans to reduce to 18 by February 2024. Destine Ozuygur, operations and forecasting analyst at eeSea, stated that congestion is building daily with around 30 vessels awaiting passage at various anchor points and surrounding ports.

Ms Ozuygur stated, “The more outwardly dramatic, but less popular, measure for some eastbound vessels has been to reroute entirely and skip the Panama Canal in favour of a longer route back to Asia through the Suez Canal.”


  • Over the last two weeks China/East Asia to North America West Coast spot rates have fallen by 5.7% from $1,711 /FEU to $1,613 /FEU according to Freightos data.
  • China/East Asia to North America East Coast spot rates have slightly risen over the last two weeks, increasing by 6.7% to $2,362/FEU.
  • Global container spot prices have fallen over the last two weeks, and are now sitting at $1,155/FEU, a 5% decrease over the last two weeks, and a 59% decrease from spot rates this time in 2022 according to the Freightos Baltic Index (FBX)
  • X-Press Feeder has announced that its new 14 methanol-fuelled newbuild vessels will be used across European trade routes. The vessels are currently being constructed and will have a total 22,774 teu. “Feeder ships travel to small ports and we need assurance that they will fit with existing infrastructure. Small ships have smaller deadweight and don’t have the ability to sacrifice space. Based on those reasons, we felt that methanol was the safest,” said Alex Hartnoll, Head of Sustainability at X-Press.


  • Global Air Freight spot rates currently sit at $2.48, as rates continue to fluctuate according to the Freightos Air Freight Index (FAX)
  • Europe to Northern America spot rates currently sit at $2.10 (100-3000kg), says FAX, increasing by 16%
  • Europe to Central Asia spot rates have increased by 0.45% currently sitting at $2.19 (100-3000kg), says FAX
  • Europe to Asia, Greater China spot rates currently sit at $1.41 (100-3000kg), says FAX
  • It seems that even though demand for air freight is low, rates have increased with the help of poor weather conditions and peak season eCommerce demand. Major east-west trade routes have seen rates rise for example Hong Kong to North America which are now at their highest of the year. Rates from Hong Kong to Europe have also increased. North American rate increases mean that they are now just 0.6% below what they were a year ago.

That’s all for this week’s update…

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