• Market continues with constraints in capacity demand and is heighten with the traditional Peak Season leading into the various major events in the market; namely 11:11 eCom sales event; Thanksgiving; Christmas; as well as the early Chinese New Year of 2022 in early Feb 2022
• Rates remain high for Air freight & Ocean freight.
• This has also been exacerbated by new Covid developments; infections outbreaks in Asia resulting in strict measures being implemented at airport/seaport as well as on operating air /ocean crew.
• Ocean port congestion remains; as well as equipment situation continue to be tight across all ports as shortage of empty containers remains an “industry-wide challenge” across Asia.
• Courier mode freight is not spared similarly and has seen constraints as well in particular North Asia (China & Hong Kong) locations experiencing constraints / bottlenecks due to surges in demand.
• Ground / Truck mode is by and large stable, and all channels are flowing; however, with some newly arising constraints/challenges observed at the China/Vietnam border crossing

North Asia: Strong air freight market demand continues as the market remains highly congested due to cumulation of several factors; including peak period increase demand; new Covid infections waves; carriers’ operational activities and continue shifts in transport mode between ocean and air due to supply chain delays and disruptions. 

The capacity situation remains demanding and is heightened due to these additional developments, despite the ongoing challenging landscape from the historical period which has not fully recovered yet in tandem with the additional year end rush and with no extra available capacity in the market for supporting these demand surges. 

Charters resources are extremely limited in order to meet market demand, although some airlines are converting commercial flights to charter. Some airlines are experiencing several Freighter AOG as well, which has disrupted their scheduled operations. 

The Civil Aviation Administration China (CAAC) has also plan to put a limit on PAX Cargo charters from Jan 1, 2022. This new regulation requests China base carriers to resume cabin seats only. This will result to around 1200T/week for long haul and 800T/week for short haul cargo capacity being remove from the market once this regulation is implemented.

PAX flights capacity which provide belly freight capacities historically is still not at pre-Covid levels (at best 40%) with expectation of further capacity reductions and flight schedule changes due to new waives of infections. This will most likely not improve and capacity will remain tight until the rest of the year. 

The market is going into a super peak with rates across Asia at unseen levels and this trend will continue as carriers are also facing crew rotation problems and need to cancel flights emanating from new Covid infection waves plus countries like China has zero tolerance on Covid cases with policies implementing stringent measures for handling/sanitizing/and crew exchanges resulting in severe impacts on the inbound capacity to China.

HKG Government has also announced effective December 2 and 3, to add 12 countries to the Group A (high-risk) list. Under exemption pilots and crews upon return to HKG are required to be quarantined for 3 days (if no exemption, they would have to quarantine for 21 days for serving Group A countries). Since more countries are added to the list, it adds even more pressure on the current crew rotation. While airlines are trying their best to maintain as many flights as they can, these new additions will possibly force them to announce more cancellations in coming days

Additionally, Hong Kong authorities are also demanding airlines to use separate crew for mainland China flights as the Omicron variant prompts tough new measures. The decision to separate China aircrew from those working international routes was made in light of the emerging Omicron variant, sources said, as officials weighed even tougher rules and fewer exemptions for flight personnel. The new measures, which come as Hong Kong rushes to meet Beijing’s requirements for reopening the mainland border, will add yet more cost and operational complexity and constraints to the market.

Terminal operating challenges remains across key hubs including PVG; wherein terminal and ramp service providers are still constrained with manpower issues. The 14 + 7 + 7 government regulation is still applicable and hence the manpower shortage continues.

Oversized shipments have less priority for ground handling agents/airlines and shippers are struggling with booking, experiencing constant rescheduling and cancellations of any odd-sized shipments. Rates are skyrocketing for shipping such cargo with very limited and expensive options available on the market, so machinery/equipment shipments are a real challenge in current from both cost and transit time perspectives.

Overall exports from China / Hong Kong remains tight and rates have increased. Rates are anticipated to remain at high levels through end of the year if there are no improvements to capacity and terminal rules continue to be strict. Exports from Japan, Korea; remain similar to the previous week. Most airlines prefer to accept smaller size shipments. 

South Asia - capacity remains scarce due to the historical heavy reliance on PAX networks. Although several countries announced vaccinated travel lanes (VTL), capacity is still constrained. In addition, intra-Asia competes with long-haul demand which rely on the same first leg capacity. Intra-Asia capacity remains in shortage as new waves of Covid cases has led to flight cancellations and weakened air travel prospects.

Vietnam’s exports have bounced back quickly after months of lockdown, boosting freight rates and shortage of capacities. There is high demand for airfreight ex-Vietnam and planes are fully booked weeks in advance. Rates remain high and are expected to stay at that level until after TET (Vietnam’s Chinese New Year). Charter costs ex VN are now at un-precedented levels.

India Sub-continent - demand remains steady, and capacity is still limited as market rely on historical PAX market/belly freight. There are still flight cancellations and/or reductions due to travel restrictions imposed on travel to/from India.

The ongoing erratic lockdown measures and Covid-related restrictions in China and in Southeast Asia has led to rates going up and down on the spot markets in an un-precedented and volatile way.

These market dynamics are putting pressure on rate levels and stretching transit times, both for the ‘super peak’ period and expected into 2022. The outlook of this current super peak season is expected to last until Chinese New Year at the end of January 2022/early February 2022.

India Sub-continent - demand remains steady, and capacity is still limited as market rely on historical PAX market/belly freight. There are still flight cancellations and/or reductions due to travel restrictions imposed on travel to/from India.

The ongoing erratic lockdown measures and Covid-related restrictions in China and in Southeast Asia has led to rates going up and down on the spot markets in an un-precedented and volatile way.

These market dynamics are putting pressure on rate levels and stretching transit times, both for the ‘super peak’ period and expected into 2022. The outlook of this current super peak season is expected to last until Chinese New Year at the end of January 2022/early February 2022.

Forward Looking

The outlook for any relief in air freight rates early next year is expected to be disappointed due to a host of factors, including the Omicron variant and its likely impact on belly capacity and lockdowns. Capacity seems to be getting tighter, rather than looser, labor remains a major constraint, and while we have all read about the congestion at the seaports, similar congestion is happening on airport cargo ramps as well. All of this paints a convoluted picture for the 2022 market and could see pricing remaining high. These factors would contribute to persistently elevated air freight rates and shippers looking for relief in the seasonal first quarter freight lull may not find it.

The outlook for any relief in air freight rates early next year is expected to be disappointed due to a host of factors, including the Omicron variant and its likely impact on belly capacity and lockdowns. Capacity seems to be getting tighter, rather than looser, labor remains a major constraint, and while we have all read about the congestion at the seaports, similar congestion is happening on airport cargo ramps as well. All of this paints a convoluted picture for the 2022 market and could see pricing remaining high. These factors would contribute to persistently elevated air freight rates and shippers looking for relief in the seasonal first quarter freight lull may not find it.

Global Ocean market demand remains high and continues with imbalanced against supply with no significant injection of new capacities into the market. The market update according to Seabury in October 2021 advises that the East-West long-haul trades sees a year of phenomenal demand and shows a global growth of +13.9% from Jan to Sep 2021 vs Jan to Sep 2020. Global carrier schedule reliability remains at an all-time low of 34.4% with some trade lanes even lower; ASIA – North America West Coast: 10.1% reliability, ASIA – EUROPE: 20.5% reliability. 

The rise of fuel prices on IFO380 (Intermediate Fuel Oil) and VLSFO (Very Low Fuel Sulphur Oil) has seen a bunker adjustment factor also coming into play causing rates to reflect the related increases. According to Ship & Bunker data, the average price (at the top 20 ports) of IFO 380 HSFO burned by ships with scrubbers had risen to $514.50 per metric ton up 51% since the beginning of the year. There are expectations that crude, and therefore marine fuel, could even move higher in the coming weeks as oil markets tighten further.

Global ocean freight remains at high /elevated rate levels and the outlook suggest this will continue into minimally post the Chinese New Year (February 2022) It is also highly doubtful that post the Chinese New Year will bring sufficient relief, as more and more experts say that congestion might last well into the next year. The rising congestion has further driven up rate levels and emergency surcharges all around the globe on all main haul trades.

Global indexes are all rising; different spot rate indexes give different numbers, but they all paint a similar picture of the container shipping market, one featuring little relief from ultrahigh transport costs.

The Drewry World Container Index, a global composite of main routes, rose 2.3% last week, to $9,262 per forty-foot equivalent unit, up 170% year on year. The index has not been this high since the last week of October. Looking specifically at the Asia-U.S. trade, Drewry’s Shanghai-Los Angeles weekly assessment was $10,138 per FEU last week, up 5% week on week. Drewry’s Shanghai-New York assessment rose 4% from the prior week, to $13,118 per FEU.

A different measure, the Shanghai Container Freight Index (SCFI), shows an even more bullish pattern for ocean carriers. After pulling back minimally in October, the SCFI global composite continued its climb and has just reached a new all-time high, rising 1.8% last week and 2.7% the week before that.

The global XSI ® also shows a continued meteoric rise, increasing by a further 16.3% in November to 251.32 points. This represents the largest month-on-month jump since July and takes the benchmark to 121.2% higher than the equivalent period of 2020 and the end of last year.

The Far East Imports / Exports on the XSI ® grew by 14.6% in Nov-21 to 160.22. This is the second-largest increase on record and has ensured the index is 65.5% higher than the same period last year. The benchmark is also up by 66.2% compared to the end of 2020. Far East exports rose by a similar amount, appreciating by 14.5% month-on-month to 333.08 points. In recent months, the pace of growth has increased as the index is up by 163.3% compared to Nov 2020 and 163.7% compared to Dec 2020.

The outlook suggests this landscape will last well into 2022. Shippers should expect that the whole of 2022 may be another peak season. Importers should expect the spot market to remain high for 2022. Major retailers are saying that after Lunar New Year, the outlook is going to see a very strong focus on replenishment of inventory. Inventory-to-sales ratio is the lowest it has been since the pre-recessionary days. The replenishment concept may take us through the second quarter into the summertime. And if it goes a bit longer than that, we may pivot again into peak season next year.

NORTH ASIA – Vessels continues pile up at major ports across CN & HK ports. Other ports are also experiencing on going congestion resulting in constraints and disruptions. Space and equipment continue to be a challenge due to increased demand. Bookings are much as 6 to 8 weeks out as an example on the North Asia to North America lane. Bottlenecks at the ports are not indicating any sign of improvement. The issues in North America are affecting the rest of trades by removing vessels and containers correspondingly. On time performance is down to all time low on all trade lanes. 

China’s quarantine rules for seafarers are also set to cause a big drop in Pearl River Delta feeder capacity in the run-up to Chinese New Year (CNY) in February. The disruption to feeder services could give rise to a number of ripple effects. Cargo to/from the smaller ports might see an earlier surge than usual [prior to CNY]. Some of this might be redirected onto land transport once the feeder capacity declines, which can give rise to a shortage of capacity on the land side, including for shippers only using the large ports in the region.

Indeed, a similar feeder crunch took place last year, with the potential disruption to intra-Asia shipping, the rising costs of truck moves, and the difficulties for much-needed repositioning of empty containers.

Shipping lines were also quick to sound alarm bells, warning it would be difficult to meet both import and export demand from Hong Kong and Shenzhen.

In addition to the South China barge market, shipping stakeholders have also raised red flags over China’s increasingly extreme zero-Covid policy and the ramifications for normal crew changes.; as an example; China has reportedly implemented quarantines of up to several weeks for returning seafarers, while ships with foreign crews need to wait two weeks to enter a port.

SOUTH ASIA - Carriers continue to announce blank sailings out of South Asia. Intra-Asia trade continues to suffer from limited capacity, as carriers shift capacity to more profitable trades. Space remains tight. All trade lanes Equipment availability continues to be a challenge in addition to the congestion in main transshipment hubs. Singapore port remains still congested affecting transshipment cargo lead time throughputs. Other ports including MNL; PKL; remains congested similarly; challenging and un-change with significant roll overs resulting is stretched throughput lead time. 

INTRA ASIA - Port congestion are occurring at most of Asian ports. Rates have been under extreme pressure going up due to shortage of space/equipment and port congestion. Schedule reliability has reached an all-time record low The global cascading effect of port congestion is impacting heavily on the intra-Asia trade lanes, with large amounts of cargo stuck at trans-shipment hubs in south-east Asia ports. It is not a port productivity problem, rather that feeder vessels are discharging cargo at the main trans-shipment ports with no mainline connecting vessels coming in on time to load the containers onwards.

India Sub-Continent - Imports remain strong out of all major ports, and constraints in capacity remain as well as shortages of equipment especially 40’HC containers. The supply of space continues to be very tight. All trade lanes equipment constraints remain.

Both Middle East and ISC rates are seeing increases. Routes relying on trans-shipment via Singapore/Port Kelang continue to face serious capacity constraints as many vessels are also skipping calls, causing backlog and dwell time averaging between 2-3 weeks. Some carriers have temporarily suspended accepting new bookings to clear backlog in Singapore. Equipment shortages remain across most locations especially 40’HC, which most carriers prioritize for long-haul trades. Equipment is still having huge impact in overall availability in Asia. It is expected for 40HQ to remain scarce.

Overall market is expected to remain full and rolling at least until CNY 2022, while the space situation is expected to seriously intensify by mid-December and through January. Singapore and other Southeast Asia hubs are reporting extreme congestions with large amounts of cargo stuck at transshipment hubs. Feeders and mainline vessels are discharging cargo with no mainline connecting vessels coming in on time to load the containers. 

Forward Looking

The Chinese New Year (CNY) will fall between 31 January and 6 February. In any given year, the Chinese New Year impacts the capacity to and from China and the Far East in general: with long transit times and blank sailing. We expect to see an exceptional demand for transportation of goods in a market that is characterized by limited capacity.

Courier / Small parcel mode channels remains flowing; albeit some locations/trade lanes have incurred bottlenecks/disruptions due to high demand constraints.

Capacities are available, despite strong and growing demand and prices remains high with pandemic emergency surcharges still in place as well as a recent increase of emergency surcharges by DHLE on tight trade lanes; namely exports from China & Hong Kong to Americas; Europe & Oceania.

Additionally, DHLE has also place temporary shipment weight restrictions/limitations for all outbound shipments from China & Hong Kong; with a maximum of 300 kgs per customer per day pick up in place since November until further notice  

Forward Looking

DHL Express has added more than 2,000 tons to its weekly airfreight capacity to cater to rising demand for express shipments within Asia and between Asia Pacific and the US.

The express operator will serve the route between Hong Kong and Bangkok six times each week and add 200 tons of capacity on the route using a B737-400SF operated by K-Mile Asia.

Meanwhile, Air Hong Kong has added a sixth flight rotation to the two existing routes powered by the airline’s A300-600: Beijing-Hong Kong-Beijing and Hong Kong-Cebu-Manila-Hong Kong. This will offer 1,200 tons payload each week.

For intercontinental shipments, DHL Express will draft AeroLogic’s B777F jet to fly six times a week to connect the hubs in Hong Kong and Cincinnati in the US. This will add another 610 tons of weekly capacity on this route.

All in all, the company has added over 2,000 tons of capacity in total for the mentioned routes each week.

Ground/Truck freight mode channels remains flowing both domestically and cross border Intra Asia.

However due to recent spikes in pandemic infection rates in several Asian countries, China has tightened security along its southwestern border crossing at PingXiang to try to stop a spillover in Covid cases from Vietnam. This has led to China customs authority implementing strict measures including the following, resulting in high congestions and extended delays:

• All designated drivers are not allowed to get off from vehicle and will be placed with a camera to monitor the driver whereabout during the cross-border crossing queue. All processes will be monitored by border administration.
• Only 10 trucks are allowed to cross the border at any one time. This has slowed down the process significantly which caused serious congestion at the border.
• Those trucks that are cleared / released by PingXiang customs (China export) used to be allowed to cross over to the LOLO (Load Off/Load On) area even after customs working hours. With the new additional requirements, China trucks are restricted on movement until corresponding Vietnamese trucks arrive at ChunJiang (春疆)LOLO area for simultaneous connecting with their Vietnamese counterpart on forwarding truck. In the event a VN truck cannot arrive within customs working time, the China truck needs to return to PingXiang parking area to wait for next day to resume their cross over to the LOLO area.

Air Freight into Europe from Asia is challenging due to quarantine restrictions imposed on air crew flying into China and other Asia countries.

Cargo in aircraft passenger cabins (so-called Preighters or PAX flights) will no longer be accepted by China in the new year – a move expected to keep air freight rates high.

China’s Civil Aviation Administration (CAAC) said “only anti-epidemic-related items are allowed to be loaded in the cabin”.

Even before this added capacity reduction, current prices are high driven by the issues with other modes of transport like ocean and rail, the increased use of airfreight again to bring needed PPE supplies into Europe and the reduction in passenger flights due to the new Omicron variant.

The PPE export surge is mainly of one commodity – Covid rapid testing kits – for which there has been huge demand in Europe. Factory orderbooks are full, so it doesn’t sound like the peak will soften soon.

Mainland China is busier than Hong Kong where the situation is busy but not as critical - rates have risen 10%-15% recently. Rates are at their highest ever rate level similar a to the record of last year.  The ground handling situation in China is critical due to Covid quarantine measures. Major air cargo flights are arriving or departing empty due to stringent Covid regulations impacting the turnaround times of flights.

There are also ongoing issues when freight arrives at European gateways. There are staff shortages in airport handling companies, lack of trucks and drivers to pick goods up from airports and concern over the financial state of Frankfurt Hahn airport where the Chinese owners have filed for insolvency.  This airport was widely used by freighters who have had to find alternative airports where the increased volumes have caused congestion and delays.

September 2021 registered almost 2.1 million tons of air trade globally, which makes it the third-largest month air trade history. Asia inbound to Europe was up 70,000 tons compared with September 2019.

It is also key to take into consideration the challenges for supply chains once the Beijing Winter Olympics begin in early February.

There will be a big impact on Beijing flights. Normally, [when there is an event in China] trucks are limited in their movements – no dangerous goods can be moved, no charters are approved, and flights are reduced to a minimum.

The global XSI ® has continued its meteoric rise, increasing by a further 16.3% in November to 251.32 points. This represents the largest month-on-month jump since July and takes the benchmark to 121.2% higher than the equivalent period of 2020 and the end of 2020.

Global ocean market demand is outperforming the supply much more than expected. Adjusted market outlook for 2021 shows an expected global growth of 6.3% (according to Seabury Consultants) vs supply not expected to exceed 3% with most of the capacity already delivered into the trades. Similar supply is expected for 2022. Growth during Q3/2021 had shown signs of a slowdown however more recently capacity has got tighter, and pricing is rising again. 

European imports on the XSI ® more than reversed November decline, increasing by 9.1% to 267.92 points. At another all-time high, the index is now 143.3% higher than in Nov-20 and has appreciated by 140.8% since the end of 2020. Similarly, exports jumped by 23.7% in November to 210.01. This marks the largest monthly increase on record and ensures the benchmark is now 85.0% higher year-on-year. It is also now up by 82.3% compared to December 2020. 

More sliding sailings (the strategy of delaying advertised sailings) and in consequence missing repositioning of empty equipment in all main trades continues. This impacts the available allocation across all carriers as well as the equipment availability for the remainder of the year.

In most cases ocean freight must be booked weeks in advance and even then, due to the short supply of containers and the constant profit seeking of the ocean lines (up to the last moment they will sell space to the highest bidder) and the unreliability of sailing schedules; even when you have a confirmed booking, it is not guaranteed to depart to original schedule.

Pricing continues to increase and shows no sign of reducing although there is some hope that the situation will improve post Beijing Olympics and Chinese New Year.

DHL Express: temporary weight limit restriction of 300 kg per pick up (customer collection) per day from China and Hong Kong to all destinations will remain in place until further notice.

FedEx: latest weight limitations out of Asia where Southern China is currently limited to 50 kg per shipper per day. For the remaining origins, no changes applicable.

Emergency surcharges are still in place and in the case of DHL Express have increased slightly for shipments from Asia to Europe.

Rail Freight performance has slightly improved in the last month – more route options are open and working which has helped ease some of the backlogs.

One new route bypasses both Poland and Belarus, where the political situation in Belarus and long tailbacks at the Polish border have made transport reliability difficult recently.

Outbound from Europe, the service starts with the transport of goods from the ports of Rotterdam, Hamburg, Duisburg and Gdansk/Gdynia by ship to St. Petersburg. From there, the onward transport takes place by rail to Beijing. Coming back into Europe the route is simply reversed.

Source: Lloyd’s Loading List/Informa PLC

Work is also being carried out in Hungary to improve infrastructure at the Chop/Zahony border between Ukraine and Hungary and it is hoped this work will be completed and the route up to full capacity late 2022/early 2023.

Rail freight pricing reduced in November and now is in line with current ocean freight pricing.

Transit times vary dependent on route from 14 days to 31 days.

European road freight prices have hit historic highs, driven by a mix of robust economic growth, global supply chain bottlenecks, rising costs and scarce capacity.

According to the latest European Road Freight Rate benchmark update from Transport Intelligence (Ti) and digital freight platform Upply – which have been joined by for the first time by the international road transport union IRU in promoting the information – the third quarter (Q3) 2021 European Road Freight Rate benchmark index stood at 107.6, which is 3 percentage points higher than in Q3 2020 and indicates the fifth consecutive quarter of European road freight rate increases.

In addition, Europe has seen widespread cost inflation up to the end of Q3 2021, the report highlighted, including in fuel costs. According to data from Ti and the IRU, diesel prices in Germany are 38.5% higher than Q3 2020, while the UK (+26.6%), Spain (+25.2%), France (+23.5%) and Italy (+20.6%) also saw markedly higher prices.

Key to Market Conditions 

• Q4 2021 was a peak season of all peak seasons. Record volumes and pressure on an already stressed global logistics network. 
• In Q4 we saw several LTL carriers exit the market and close their doors. This added additional strain to an already overwhelmed market. 
• The outlook is this volatility will increase going forward on up to Chinese New Year. 
• The truck stops are full and if driving anywhere on the interstate system, will often see in the late evening and earlier morning hours, stacks of trucks parked on side the interstate in order to get in their rest. 
• The labor shortage continues to have a huge impact on the entire logistics market including all modes and warehousing. 
• Warehouses across the region are at 90% plus capacity on average. 

The Cycle of Logistics Disruptions 

• The Heavy Air carriers and freight forwarders are still applying high Covid surcharges on top of normal peak season surcharges to account for high volumes this time of year tends to bring. The carriers are requesting shorter validity time for their pricing.
• Jet fuel is up 40% YOY. 
• Due to other areas of the supply chain having issues locating parts / goods/ services, the heavy air mode is being utilized to speed up the normally long planned lead times. 
• In Q4, we did see an increase in passenger flights which helped release some pressure on the global network.  

At the airports, the forwarders, airlines, and ground handling crews are trying to work together to solve the lack of resources on the ground to break the freight down and avoid the bottlenecks at the gateways. It has been a struggle for months.

                                

• The Chicago gateway has added 75,000 square feet of space to help with the congestion of air freight. 
• Freight forwarders / airlines are asking its customers to encourage the use of overpack and timely pickup from their facilities. They are also encouraging customers to highlight if a shipment is an express shipment with special markings and to take pictures in case freight gets lost in transit for quick visual recovery. 
• Forecasting has never been more important for the logistics networks and the ability to communicate that demand from shipper to carriers and up and down the network timely when changes occur. Technology integration between partners is key for this speed of change.

 Please refer to the Asia update on Ocean freight. The primary conditions are consistent across regions.

• In addition to the comments in the Asia Market update section in mid-December, the US House of Representatives passed legislation to help regulate the Ocean Shipping Industry (Ocean Shipping Reform Act).   
• The legislation is requiring Ocean Common carrier report tonnage on imports and exports and total loaded and empty 20-foot equivalent per vessel that make port in the US to the Federal Maritime Commission (FMC) each calendar quarter. 
• The FMC also announced innovation teams would be deployed to the New York and New Jersey ports to help improve the process of dual transactions. The goal is to improve the productivity for the truck drivers, terminal and the appointment system.
• The Bill also requires ocean carriers or marine terminal operators to maintain all records regarding invoiced demurrage or detention charges for at least five years and provide such records to the FMC or invoiced party on request.
• The average dwell to berth days are on average 20-30 days depending on the port on the west coast for the 4th quarter. This is a 30% increase in dwell time from Q3.
• The ships anchored out to sea outside of the LAX port hit an all-time high in December at over 100. The port will continue to see the congestion until at least Chinese New Year when it can experience some relief of loaded ships coming its way for processing. Some sources are expecting the backlogs to continue through Q2 of 2022. 
• For US outbound freight, expect the following delays: 
  • East Coast Ports = 7-10 days 
  • West Coast Ports = 20-30 days 
  • Gulf ports = 5-7 days

                            

• The market will continue to see a shortages of chassis which is causing the bottlenecks to continue at the ports across the Americas.  
• Low water levels around Paraguay during December have caused Hamburg Sud to cancel service into the port.
• From a pricing standpoint, shippers are looking at alternative options including block space agreements, moving some volumes to the Heavy air mode and looking at air charter strategy’s long term. 
• Forward looking it seems the demand is expected to exceed any capacity growth in the next quarter which means we will still see a strain on the ports, equipment and availability of containers. 
• Some sources calculate that current delays in the overall global ocean market schedule are removing almost 20% of actual vessel capacity from the market. 
• Carriers have announced rate increases in December 2021 and January 2022 covering all Central America and Caribbean ports which is to be expected since this is the traditional peak season.

• Courier / Small parcel mode channels are moving, and the demand and capacity have increased over Q4. Carriers are adding sorting facilities to handle the increased demand and avoid the bottle necks in their networks.
• Capacities is available; despite strong and growing demand.
• Prices remains high with pandemic emergency surcharges still in place and industry experts see this continuing trend to have COVID surcharges in place for the next quarter.

• The flooding in November and December in British Columbia Canada effect several modes of ground transport which the clean-up effort will affect the transportation network there into Q1'22. 
• We expect to continue to see a driver shortage while volumes and demand soar in the first quarter of 2022.
• The rail yards saw a lot of relief in Q4'21 at key intermodal hubs such as Kansas City, Dallas, Chicago, and Memphis. There continues to be a Chassis shortage which is limiting throughput at the hubs. 
• Ground/Truck freight mode channels are flowing but capacity is tight in some regions like the southwest and northeast. In Q4, the US saw a decrease in load to truck ratio from 5 to 4. The load to truck ratio is still at a 6-year high. 
• The US market is seeing a large problem with driver retention for ground freight. Freight brokers are continuing to price gauge for truck capacity. 
• The rail yards for all major companies are heavily congested and some are adding additional overflow yards to store containers until they can be processed or moved when there is an available chassis.