In June, intra-Asia shipping rates experienced a notable surge, fueled by robust cargo demand from China to Southeast Asia and other long-haul regional routes. Rates are rising even though ocean carriers have added substantial capacity. Industry executives remain optimistic that the increased demand could continue into the second half of this year.

Rates from China to Southeast Asia have reached their highest levels since December and the pricing surge has been attributed to a combination of factors, including the pause on U.S. tariffs and continued economic growth in the region. One logistics executive highlighted that the stable growth across Southeast Asian economies, along with increased investment and expansion from Chinese companies, have bolstered outbound shipments.  

According to Peter Sand, chief analyst at Xenata, cargo demand in the intra-Asia region increased by 6.6% during the first four months of the year, and exports from China to other Far East countries rose by 15% compared to the previous year. However, with China’s Golden Week holiday taking place from October 1-7, industry observers are monitoring for possible impacts and disruption. The effects on intra-Asia flows could appear later than those on long-haul routes, due to shorter transit times.

On the longer-haul routes, rates to India reached their highest point in six months while shipping rates from China to Dubai have surged by 35% since January. Sand has linked this increase to higher operating costs associated with the ongoing conflict in the Middle East.

Despite a 9% increase in deployed capacity on regional services since February, carriers are grappling with equipment shortages in key export ports. Reports indicate equipment shortages at the Vietnamese ports of Ho Chi Minh City and Haiphong. There is also a lack of containers at major Chinese ports including Shanghai, Ningbo, and Shenzhen, in addition to shortages at Taiwanese ports such as Kaohsiung.

Source: Journal of Commerce