Trans-Pacific spot rates surpass contract rates
Annual trans-Pacific contract rates reset to sharply lower levels in May. Even so, multiple ocean carrier execs insisted on conference calls that they did not sign annual contracts at levels that locked in a year’s worth of losses.
Now, according to data from Xeneta, average trans-Pacific spot rates have just edged above average contract rates. If carrier execs are telling the truth about not signing loss-making contracts, and if spot rates are at or above contract levels, it implies a more sustainable market for shipping lines.
Yellow Corp.’s shutdown may lead to LTL costs
Yellow Corp.’s shutdown has left shippers without a major player in the less-than-truckload space — a development that means higher costs are likely in store, according to trucking industry analysts.
“There’s probably going to be an increase in the pricing charged to the shipper,” said Craig Decker, who leads investment banking activities across supply chain, logistics and transportation areas at Brown Gibbons Lang & Co.
The price difference could be a 20% to 25% price per pound increase depending on the circumstances, DAT Chief of Analytics Ken Adamo suggested on a weekly market update show. All together, he said the price increases could be 7% to 10% higher.
Global grain prices increasse following attack on Unkraine’s Port of Izmail
Global grain prices increased after Russia attacked Ukraine’s Port of Izmail across the Danube River from Romania August 2.
The attacks destroyed multiple buildings and stopped ships from docking in the port, preventing Ukrainian grain being shipped down the Danube River and out through the Black Sea. Ukrainian Deputy Prime Minister Oleksandr Kubrakov said the drone strikes damaged roughly 40,000 tons of grain that were destined for China, Africa and Israel — approximately one shipload. The disruption to shipping, however, is significant.
Chicago wheat prices grew by almost 5% on the morning of August 2 due to supply concerns following the attack, according to Reuters.