Effects of the Coronavirus Outbreak on Global Transport Markets

Triggered by the Coronavirus outbreak, global transport markets are facing challenging times. We would like to support our customers and contacts in these challenges as best we can.

Our strength is our profound market knowledge and our insight into the processes and mechanisms of these markets. We therefore regularly provide the members of our Market Intelligence Initiatives with updates on the situation in the container freight, air freight and land freight markets.

We would also like to share this knowledge, at least in part, with our newsletter readers.

 

Effects on Container Shipping (27.04.2020)

On the container freight market some major trends influence operations.

For long haul services blank sailings are still a matter of concern. Further blank sailings have been announced for the Transpacific trade. The Asia-Europe trade is suffering its second wave of blank sailings.

Announced network restructuring is now also clearly visible. According to our experts these changes might stay with us for quite a while.

In Europe, capacity is currently improving because the market is recovering from the first wave of blank sailings. According to our experts it is likely that the second wave of blank sailings will reach the market in approximately two weeks. This may cause another period of massively restricted capacities lasting between two and four weeks. Our experts hope that the market will return to a new normal after this period, providing 90 to 95% of usual capacity, then.

At the same time European countries are slowly reviving their economies. Our experts predict a moderate recovery for May. If this recovery provokes a demand hike in the coming period of restricted capacity, the container freight market will certainly come under pressure again.

Compared to Europe the USA is still some steps behind in economic recovery. Our experts assume that they will need three to four weeks more to reach the European level.

 

Effects on the Air Freight Market (27.04.2020)

On a global scale, the air cargo rates have been less volatile last week. They seem to stabilize. By contrast the rates for transports from China are further increasing.

Ground handlers and other parties implement additional surcharges to secure their survival in the crisis. On the other hand several airlines reduce their jet fuel surcharges, even though they are making big losses due to hedging of jet fuel.

That means the pricing situation is still unclear for shippers all around the world. Shippers rely on the willingness of service providers to cooperate.

They need reliable partners. This is why long, trusting business relationships are a great advantage in the current situation. According to our experts a regular and transparent exchange and pro-active emergency handling on both sites is indispensable.

A revitalization of passenger travel is still not foreseen, that means lack of belly capacity will persist.

First airlines like Virgin Australia and South African Airways have filed for bankruptcy. Our experts estimate that others will follow. Their survival will rely on their mother states’ support measures.

 

New Webcast Series: Mastering Pandemic Challenges

In the Transporeon webcasts, our MII experts regularly inform about current developments in the global transport markets.

  • Live Webcast Q&As: Mastering Pandemic Challenges
    On Mondays, 11:00 a.m. CET (~30 min)
  • Live Webcast: Update on Road Transportation
    On Wednesdays, 11:00 a.m. CET (~20 min)
  • Live Webcast: Update on Air & Ocean Freight
    On Fridays,  11:00 a.m. CET (~20 min)
Please register here