Supply Chain Strategist Cover (1140 x 616 px)(1)
Air cargo rates hit a near record high; Materials prices retreat; Asian nations continue to build bilateral trade deals

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Lian Aug2021

For those who still haven’t learned the importance of creating an adaptable supply chain, Omicron has shown up to teach that lesson. 

LOGISTICS

Freight Rates Dec

New concerns over the impact of the Omicron variant making shippers cautious about the stability of the supply chain.  Right now the biggest fear is that of workers being infected or of strict social distancing measures at ports that could add more delays.

Shanghai-US rates climbed 15-20% in November, and are less than 5% below the record high set during the 2020 PPE rush, according to Freightos.

Trans-Pacific carriers are slowing their vessels en route to Los Angeles–Long Beach, however cargo volumes remain high at ports, according to the JOC.

About 15% of capacity in December may be considered effectively unavailable due to congestion-related delays and other issues, said Flexport.

Asia to Europe rates remain at a record high level, although they have been relatively stable through October and November. Some slight increases are expected for December in the lead up to the Chinese New Year period, according to Flexport.

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TRADE AGREEMENTS

China and Pakistan are leveraging strong bilateral cooperation – from cotton fiber to finished garments – with the end market increasingly being China’s domestic consumer market.

A China-Cambodia free trade agreement (CCFTA) is set to be effective as of January 2022.

MATERIALS

Materials Prices Dec
  • Raw materials prices retreated on weaker demand as the market moved into the off peak season.
  • Oil prices dropped as nations collaborated to release reserve supplies into the market specifically to drive down prices ahead of the winter season.

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