In the past two years, cargo airlines suffered immensely due to coronavirus-related restrictions. Worldwide, passenger numbers plummeted by about four-fifths, which also reduced transport capacities in the belly of the planes accordingly. In the meantime, things are looking up again: due to the easing of Covid-related restrictions, global air freight improved its performance in May 2022. As a report by the International Air Transport Association (IATA) shows, global cargo volumes in May were 8.3% below the previous year’s level. In April, however, this figure stood at a minus of 9.1%.

Let’s take a look at the high seas: shipping companies are taking increasingly rigid action against false declarations regarding the gross mass to be transported. Anyone who declares a container to weigh less that than it actually weighs has to pay a fine. US shipping company, Ocean Network Express, has shown how it works. The amount of this “weight discrepancy fee” depends on the carrier. If the tolerance limit of plus or minus 3 t/20-foot container (TEU) is breached, the fine starts at USD 2,000 (EUR 1,993). Freight giant Maersk is once again dreaming big and wants to add USD 5,000 per booking for incorrect (or deliberately incorrect) declarations, “plus all costs arising from the implementation of corrective measures”.

German railways Deutsche Bahn has shown how it’s done, and the Americans are following the Germans’ example: in the US, rail freight transport is in total chaos. Just how bad it is can be seen from a customer letter from LyondellBasell, according to which, two of the railway companies operating in the US have restricted traffic on their networks due to high demand and operational and staffing problems. The result: significant congestion and delays in the transport of goods and commodities of all kinds. The fact that the US regulatory authority has also imposed an emergency service order, according to which the transport of grain to some farms in the Northwest enjoys absolute priority and can preferentially use the railways, does not make things any better.

There is, however, a piece of good news: Romanian border station Galati can be used more intensively for grain exports from Ukraine to Africa after the major effort of repairing tracks and renewing switches was finished in the past few weeks. Until now, most of the grain had been transported in river freighters to the Black Sea port of Constantia. Thanks to the rehabilitated train connection to Galati, some time can now be saved.

The situation is different on Germany’s Rhine River. The country’s most important waterway is causing increasing difficulties for the chemical industry and the energy sector. Due to the persistent drought, water levels are falling, and the Rhine threatens to degenerate into a trickle. This leads to further problems with the already-tight possibilities of inland logistics, because ships can no longer be fully loaded. And the real heat wave is yet to come...

Finally, let’s take a look at the shipping rates: prices for the transport of a 40-foot container (FEU) dropped in the week from 11 to 17 July, compared to the previous week on almost all routes. For example, from China to the US West Coast it cost USD 8,000, 5.9% less than the week before.

The route from China to the US East Coast also fell in price by 4.7%, landing at USD 10,000. From China to Northern Europe, FEU prices fell only slightly (-1.8%) to USD 10,800. The drop on the return leg was much more pronounced at -14.3% to USD 600. The route from China to Southern Europe cost USD 12,500, down 3.8% on the previous week. The return leg cost USD 1,200, around 4% less than the previous week. The price drop for the FEU from the US East Coast to Northern Europe was drastic, USD 700, representing a drop of 16.7%, while the route from Northern Europe to the US East Coast remained expensive at USD 8,500.