For businesses in Australia that import, sea freight services are a large part of their logistics budget and the variability of the sea freight market can make planning a challenge.

BCR is an international freight forwarder focused on improving results for our customers. Each month we provide an update on the sea freight services market to keep you informed and enable you to prepare for changes that may lie ahead.

Read on for a brief update on the North East Asia, South East Asia, United States and Europe trade lanes and the pending increases in import and export Port and Terminal Handling Charges.

North East Asia to Australia – Import Sea Freight Services

Another month has past where we have continued to experience volatility as carriers desperately try to hang onto market share. Last month we mentioned that a more aggressive approach to cut back supply was taken with 5 blank sailings removing over 60% of lane capacity. However, this did not have the desired impact carriers had hoped to achieve.

Any increases to rates levied post 15 May GRI announcements as a result of the cut backs to space, have again failed to gain traction.

Weak global demand and EOFY traditionally impact freight forwarder cargo volumes in June more so than any time of year. Therefore, we will start to see the emergence of a spot rate market come to the fore as carriers react to the effects of these soft market pressures.

To combat the sliding rate scale sea freight carriers will once again try to restore the minimum rate levels by announcing another GRI or RR to take effect on 1 July. This is seen as a “rate restoration” rather than a “general rate increase”.

In BCR’s opinion, shipping lines will continue to pursue GRIs with little success. BCR is committed to ensure that our valued customers are briefed on any market changes and whilst these announcements are marred with challenges we believe it is important to provide you with current market information to ensure you are kept up to date in this ever-changing price cycle.

We can also report that the SSP will come to an end in Week 29 with no signs of AADA member lines extending this program.  Therefore, market fundamentals will play an important role in future pricing fluctuations. At BCR, our Customer Service Team Members and Account Managers will continue to ensure that a proactive role in communicating these changes will see our customers’ desired goals are met.

South East Asia to Australia - Import Sea Freight Services

This trade continues to be more stable for freight forwarders, 3PL providers and shippers than NEASIA and there are no planned rate increases in the coming month.  We will continue to keep you advised of any changes that are planned via our dedicated team of Customer Service specialists.

United States to Australia - Import Sea Freight Services

In last month’s edition we advised that carriers were confident in gaining traction on another round of GRIs announced to take effect on 15 June 2015.

Despite congestion vastly improving and VSA lines announcing to trade that all Coasts of the USA would see this GRI being pushed through, we now have confirmation that the VSA member lines will postpone the increase for shipments from East Coast and gulf ports to Australia and New Zealand to 1 August 2015.

For shipments from West Coast Ports USA the GRI will still be effective 15 June 2015. Furthermore, we can confirm that the Bunker Adjustment Factor (BAF) and Low Sulphur Surcharge (LSS) are also being reviewed.

The BCR team will continue to keep our customers informed of any changes occurring in this trade lane to ensure that their supply chain and 3PL requirements continue to be met.

Europe to Australia - Import Sea Freight Services

This trade continues to remain stable with no sea freight service increases on the horizon.

Our team of professionals will ensure the right carrier is matched to meet your sea freight needs with either transhipment options or direct services when and where required.

Port Charges May Increase from July

BCR has received notices from various carriers to advise that import and export Port Charges and Terminal Handling Charges will be reviewed effective July 1 2015. These are traditionally increased this time of year as terminal agreements are renewed with the carriers.

To discuss any items included in this sea freight market update, please submit your comments below or contact us for more infromation. We also invite you to sign up for the BCR Newsletter for helpful information daily or weekly directly to your inbox. Click the button below to subscribe.