Freight rates are up across the board as the war with Iran continues. Fuel and bunker costs are rising, and carriers are implementing increases on every transportation mode. Carriers are also sounding the alarm over bunker fuel supply overall; supplies are running low, including at major hubs like Singapore.
Asia-US spot rates are up and holding at higher levels. Carriers are reviewing rates frequently, offering week-long spot rate validities, so increases are possible more often. There will likely be another increase as of April 7.
The Federal Maritime Commission (FMC) has rejected requests from ocean carriers to suspend the required 30-day notice of rate increase. Carriers had cited extreme bunker fuel increases. So far, the FMC is holding firm on the existing framework and advising carriers they must maintain the required notice.
The outlook remains very uncertain. Most analysts agree that fuel costs will remain elevated for a while, past the duration of the war itself. Planning ahead, while challenging during these times of disruption, is as critical as ever.
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Rachel Shames
VP, Pricing & Procurement
CV International, Inc.