Disruptions in global container shipping triggered by the Red Sea crisis and an early peak season have caused ocean spot rates to rise sharply in May and June in many key trades. Consequently, it is affecting long-term rates, particularly for freight forwarders.

Xeneta analyst Emily Stausboll noted a shift in which carriers have prioritized direct contracts with major BCOs over forwarders. Looking at the Far East Exports index for long-term contracts signed in the past three months, Stausboll said forwarders have seen higher long-term rates, while shippers have seen lower rates.

Some forwarders have said their named account allocations were reduced as carriers prioritized higher-paying cargo. This has pressured forwarders to secure capacity through higher rates or pay for premium services to guarantee space.

While the largest BCOs will likely maintain allocations, smaller shippers relying on forwarders will be negatively impacted. Stausboll said that “the spread between the long- and short-term markets presents a more clear and present threat to their [the smaller shipper’s] supply chains”.

Source: The Loadstar