Why do air freight and sea freight prices fluctuate frequently

While spot ocean freight rates from the Far East to the East Coast of South America are heading in the right direction, short-term air freight rates for intra-Asia and long-haul trade have failed to take off.
 

Of course, in terms of ocean freight prices, the long-term market tends to catch up with the spot market, with a delay of around three months. So, for example, in trading from the Far East to South America, the drop in spot rates that we started to see in January was reflected in April and the following months.
 

In the case of Far East Air Cargo, the situation appears to be heading in the opposite direction, with short-term freight rates falling despite rising volumes and capacity. Dynamic load factors at the key hub in Shanghai have also climbed since the last COVID-19 lockdown ended, with its contribution to all exports rising from 69% in April to 93% in June.
 

While all routes were hit by lower spot prices, long-haul trade was the hardest hit, according to Xeneta data. Prices from Shanghai to the U.S. have plunged 32% since the start of the year, bringing rates to $8.50 a kilo, the lowest since August 2021.
 

Short-haul rates haven't fallen as much and are basically back where they were at the start of the year. Prices from Shanghai to Hong Kong dropped to $2.32 per kilogram from $3.50 in early May 2022.
 

This is an ever-changing market, with COVID-19, fears of increased cases and future lockdowns waiting to affect future rates. It is difficult to predict how events will unfold, so it is crucial to gain understanding and value in any rate negotiation with the latest rate data.
 

If you have a need to ship goods from China to the United States, please contact Orglinklog Logistics for a quote plan!