Shippers’ Concerns? Managing Freight Spend

Freight spend is the top concern for shippers and forwarders due to ongoing supply chain volatility and ocean rate hikes.

Spot rates on major Far East trades initially spiked, dropped, and then escalated in May 24.

A volatile year

Xeneta’s mid-year update reveals that, contrary to earlier predictions of significant losses, carriers will likely turn a profit in 2024 due to a surging spot market. This year’s volatility has exceeded expectations, with spot rates on major Far East trades initially spiking, softening, and then escalating again in May. This rate disruption is thought to have been mainly influenced by the Red Sea crisis.

Poll highlights freight spend

A Xeneta poll indicates that 46% of shippers and forwarders identify managing freight spend as their primary challenge. Rising spot rates have also affected contract rates, with 74% of Xeneta customers experiencing premium surcharges.

46% of shippers and forwarders identify managing freight spend as their primary challenge.

Rates will normalise

Maersk CEO Vincent Clerc attributed temporarily higher freight rates to increased charter costs and assured that these rates would eventually normalise. However, Vespucci Maritime CEO Lars Jensen warned that disruptions might persist into the medium-term future.