Shipping & Freight Cost Increases, Freight Capacity, and Shipping Container Shortage [2021]

Ocean freight rate increases and delays

With many importers and exporters already shipping holiday inventory, August is likely set a new record for monthly US ocean import volumes. 

In response to rising demand, ocean carriers have increased transpacific container capacity by approximately 22%. But with no way to increase port capacity, those additional ships are contributing to the new record number of vessels waiting for days outside of LA/Long Beach ports.  

Ocean freight rates remain extremely high but stable.

• Asia – US prices went unchanged this week, but are still 5X their level a year ago.
• Asia – US East Coast rates are still more than $20K/FEU. 
• Asia – Europe rates are at record levels – 8X this time last year – but have also remained stable.

Basically, freight is really expensive, but with close to no capacity many importers and exporters are willing to pay premiums in addition to these rates just to keep their goods moving.