Higher ocean and air freight volumes are expected on key lanes to and from the Asia-Pacific (APAC) three months from now, particularly for the Asia-Europe trade, while the outlook for intra-Asia trade is also rosy, according to a new index for Asia forwarding markets.
Survey results published late April showed that optimism is high for the Asia-Europe air and ocean lanes after heavy month-on-month volume gains, with respondents expecting eastbound and westbound volume to surge in the coming months.
Moreover, intra-Asia volumes by all modes are expected to further expand in the third quarter.
The survey results are the first step towards the creation of The New APAC Forwarding Index, to be published in the coming months by Mike King & Associates and Logistics Trends & Insights LLC.
APAC ocean forwarding markets
About 60% of survey respondents said ocean freight volumes to and from APAC in April were higher than March, while 54% predicted they would handle higher volumes three months from now.
Rising demand for ocean services from Europe to Asia, a trend that has led to a shortage of capacity and loading delays at European ports, saw 80% of respondents report higher volumes on the trade in April compared to March. About 70% also expect volumes on the lane to be higher three months from now.
“Demand has been higher than we’d anticipated from Europe to Asia, and there has also been some disruption to liner services following blank sailings around Chinese New Year and changes to alliances,” said one respondent. “We expect capacity to be tight well into Q2.”
Some 70% of respondents expect APAC-to-Europe ocean freight volumes to increase three months from now, while 66.7% forecast that volumes will rise from APAC to North America.
However, optimism for the North America-APAC trade was hard to discern, said the report. Only 28.6% of respondents saw higher volumes on the lane in April compared to March, while only 43% expect volumes to increase three months from now.
“Despite uncertainty surrounding liner Alliances leading up to April 1 and the various bedding issues we have seen including terminal congestion in China and a lack of capacity in Europe, optimism is high for the APAC ocean freight market,” said the paper.
“The Europe to APAC trade lane had the highest percentage rate of month-to-month volume gains according to respondents to our first survey. The next most dynamic lanes were APAC to Europe and APAC to North America.”
Meanwhile the North America-to-APAC liner trade reported the lowest percentage of respondents recording volume increases in April compared to March, which could be the strength of the greenback catching up with exporters.
“On most lanes the majority of respondents expect to see higher volumes over the next three months than at present, which bodes well for forwarders and lines,” said the paper.
APAC air markets
About 54% of survey respondents predicted APAC volumes across all air trade lanes will be higher in three months than at present, with 37% expecting them to remain the same and just 9% lower.
Around 52% of respondents reported that volumes in April compared to March were higher while only 11% said they were lower.
As with ocean trades, the most dynamic air cargo lanes in April compared to March were APAC-to-Europe (73% experienced higher volumes month-on-month), Europe-to-APAC (55% higher m-o-m) and APAC-to-North America (63% higher m-o-m).
“Concerns of a possible protectionist import tax on goods entering the US may be holding some shippers back in the North America region,” said the report. “Still, a respectable showing for North America as the economy remains healthy as the first half of the year progresses.”
It noted that emerging markets’ volume appears strongest to APAC for air freight, with more than half of respondents anticipating higher volumes on the lane three months from now. This is likely due to food imports from such locations as Africa, Chile, Argentina and elsewhere, the report said.
Intra-Asia market
Volumes by all modes in the intra-Asia trade rose from March to April, according to over 70% of respondents, while almost 60% of respondents predicted higher volumes on intra-Asia trades by all modes three months from now.
“Higher air freight volumes dominate intra-Asia expectations with a large majority of survey respondents expecting gains from this transport mode,” said the paper.
“More generally, we’ve seen manufacturing activity perk upwards in Asia and we’re seeing a global economy that is performing well, so the demand side is good. All of this is keeping intra-Asia trade humming along by all modes.”
Photo By Ingenieria-logistica
