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HomeInformationMarket InsightsDisparity in rates sought and offered could delay TransPacific contracts - Dimerco

Disparity in rates sought and offered could delay TransPacific contracts – Dimerco

“The global economy is in a delicate balancing act, teetering between growth and inflation” – this seems to be the crux of Dimerco’s Asia-Pacific Freight Market Report for April to May 2024.

The findings in this report highlight significant trends and challenges that are shaping the freight market in this critical region.

Inflation and Global Economic Stability

According to the Dimerco report, the Global Manufacturing PMI rose from 50.3 in February to 50.6 in March 2024, indicating a slight uptick in manufacturing activities which is a positive sign. However, it comes with the caveat of rising prices, particularly in the service sector, driving inflation.

In the US, inflation has surged beyond expectations, with headline inflation at 3.5% and core inflation at 3.8% forcing the Federal Reserve to reconsider its plans for interest rate cuts, likely pushing them back to later in the year.

China and India are showing robust growth, with PMI readings above 50, indicating expansion while countries like Taiwan and Japan are facing contraction, with PMIs below 50.

This variance highlights the uneven recovery across the Asia Pacific region, reflecting different levels of economic resilience and challenges.

Waves of change in the ocean sector

Although there was a surge in new container ship deliveries in March with a capacity of 260,000 TEUs delivered, the Dimerco report speaks to a widening rate gap for transpacific shipments. It suggests that the disparity between the rates sought by Beneficial Cargo Owners (BCOs) and those offered by the carriers could potentially delay contract renewals in 2024.

The report suggests that “Situations such as potential disruptions in the Red Sea, a looming strike at US East Coast and Gulf Coast ports by ILA in October & November, and the US presidential election in November are expected to keep FAK floating rates elevated,” making 2024 a challenging year for negotiations.

The Asia-Pacific freight market in April-May 2024, as detailed in Dimerco’s report, showcases the resilience and complexity of global trade. By understanding the current landscape and anticipating future shifts, we can better prepare for the challenges and opportunities that lie ahead.

To receive the full report, please contact

Gitte Willemsens
PR & Brand Communications Director
CHARLIE PESTI
Gitte.w@pesti.io

About Dimerco Express Group

Dimerco Express Group integrates air and ocean freight, trade compliance and contract logistics services to help companies compete and win through superior global logistics. The majority of the company’s logistics projects connect Asia’s logistics and manufacturing hubs with each other, and with North America and Europe.

This focus makes Dimerco the premier global 3PL at connecting Asia with the world. Founded as an air freight forwarder in Taiwan in 1971, Dimerco now serves customers from 150+ Dimerco offices, 80 contract logistics operations, and 200+ strategic partner agents throughout China, India, Asia Pacific, North America, and Europe.

For further information about Dimerco and its initiatives, please visit https://dimerco.com/


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