Shippers moving cargo from Asia to the East Coast of South America (ECSA) are facing significant peak season disruptions, as container spot rates have nearly doubled in recent weeks. The sharp rise in rates is being driven by port congestion, equipment shortages, blank sailings, and carriers reallocating vessels to the Asia-U.S. trade.
Ports in Brazil – Santos, Itapoa, Rio Grande, and Pecem, along with Buenos Aires in Argentina, are reporting vessel wait times of up to three days. The congestion has absorbed newly deployed capacity and is being worsened by an ongoing Brazilian customs workers’ strike that began in January. Customs officers are now only processing time-sensitive shipments, further slowing down cargo flow.
Carriers are increasingly prioritizing higher-yield Asia–U.S. lanes. As a result, capacity to ECSA has tightened considerably. CMA CGM is planning to introduce a series of peak season surcharges of $1,000 to $2,000 per container between June and July.
Equipment availability is another major issue. Forwarders report container shortages from Zim across all Brazilian ports, while Cosco is facing availability issues in Rio de Janeiro. Some carriers are prioritizing spot market cargo over contract commitments, causing rollovers and forcing forwarders to rebook at higher rates.
Carriers are also tightly managing capacity. In May, 12.6% of the Asia-ECSA capacity was blanked, up from 2.8% in April, according to eeSea. HMM canceled calls to redirect vessels to the Asia-U.S. route, while Hapag-Lloyd and Cosco reduced their Q2 ECSA capacity by 33% and 20%, respectively, based on MDS Transmodal data.
On the West Coast of South America (WCSA), the trend is similar. Spot rates for the North Asia-WCSA route rose 63% in two weeks. Ports like Valparaiso and Buenaventura face minor disruptions while Callao in Peru is heavily affected by local street closures, potentially extending port entry times by 30%.
Source: Journal of Commerce
