Customer circular – SIS Seafreight

Dear Ladies and Gentlemen,

Please find below our latest market update on the most important developments in the ocean freight sector.

The international ocean freight markets are currently characterized by high operational volatility and, in some cases, significant capacity constraints. In addition to the strained situation at Asian export ports, persistently low water levels on the Rhine, in particular, are having an increasing impact on European hinterland transport.
Below, we provide an overview of the key developments and their impact on the supply chain.

Europe | Low Water Levels on the Rhine Disrupt Inland Transportation

The persistently low water levels on the Rhine are currently causing significant disruptions to inland waterway shipping. Available transport capacity is currently severely limited and, in some cases, unavailable due to technical and operational constraints, forcing container shipments to increasingly shift to alternative modes of transport.

Rail and truck capacities, in particular, are thus under additional pressure. The already high utilization rates in rail freight transport are being exacerbated by the shift of additional volumes.
At the same time, the short-term availability of truck capacity is limited, which is partly reflected in longer lead times and increased transportation costs.

Operational processes at the western ports are also affected by this. The shift from barge to truck transport
means less capacity is available for necessary terminal transfers. At the same time, backlogs at individual
terminals and limited slot availability are leading to additional wait times. This can have a particular impact on
terminal transfers, train loadings, and adherence to cargo closing times.

India | Capacity Remains Tight and Rates Continue to Rise

Ocean freight traffic to and from India also remains tight at present. A combination of high export demand from India, limited vessel capacity, port congestion, and, in some cases, restricted equipment availability is leading to a market situation that remains volatile. Backlogs are occurring at major Indian gateways due to high utilization rates and delayed vessel handling. At the same time, capacity controls by shipping lines and
additional surcharges are influencing current rate trends.

The current market situation is leading to increased price and capacity risk. Rising ocean freight rates, limited equipment availability, and short-term capacity bottlenecks may result in shipments being postponed or rolled over to later departures.

China & Asia | High Port Utilization and Weather-Related Disruptions

Operational constraints and delays continue at several Chinese export ports. In addition to high utilization rates, several weather-related disruptions have further impacted operations. Significant vessel and terminal backlogs have recently been reported in Shanghai and Ningbo. For certain areas of the Port of Shanghai, waiting times ranging from several days to around twelve days have been reported.

The effects are now extending to shipping lines’ schedules. Port skips, rollovers, and last-minute schedule adjustments can cause delays from the ports of departure to spill over into subsequent connections and transshipment ports.

Impact on the Global Supply Chain

Current developments show that individual challenges along the supply chain are increasingly reinforcing one another. Port congestion in Asia can lead to ship delays and rescheduling. At the same time, low water levels in Europe are making it difficult to reliably transport containers to the hinterland. As a result, early and proactive transportation planning is becoming even more important.

We therefore currently recommend the following in particular:
– Place bookings early
– Try to secure equipment in a timely manner
– Allow for sufficient time buffers for transit times
– For time-sensitive shipments, explore alternative routing and transportation options

Our SCM Online Tracking Portal is available to you at any time to provide greater transparency and better control over your shipments. This allows you to view the current status of your shipments online at any time and track important transport milestones as well as estimated departure and arrival times. Especially in a dynamic market environment, this gives you the opportunity to identify changes early on and adjust your subsequent logistics processes accordingly.

Please contact us if you have any general questions about SCM or using the portal—our team is alwayshappy to assist you.

Best regards,