Executive Briefings

Ocean Transportation Rates May Drop in Fourth Quarter, DHL Exec Says

Lines could see the freight rate gains of this year on major trades wiped out in the fourth quarter when more vessels enter the market and volumes contract post-peak season, according to a third-partly logistics executive.

David Goldberg, senior vice president for ocean freight Asia Pacific at DHL Global Forwarding, said there was a strong risk of rates coming down later in the year after as peak season demand subsided.

While rates should remain relatively stable during the peak shipping season, current levels might prove "unsustainable" during the fourth quarter when volumes usually dip and new ships are due to be delivered.

On the Asia-Europe trade Goldberg predicted a traditional June-August peak and said that so far volumes had remained mostly unaffected by the Euro crisis. "It seems more of a sovereign debt issue," he added. "It's not really rolling into the corporate and private sector."

On the trans-Pacific trade he said there would be a cargo build-up in the next three to four months with "a more normal peak season of restocking pre-Christmas" than witnessed in 2010 or 2011.

"But," he added, "I wonder about the fourth quarter."

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David Goldberg, senior vice president for ocean freight Asia Pacific at DHL Global Forwarding, said there was a strong risk of rates coming down later in the year after as peak season demand subsided.

While rates should remain relatively stable during the peak shipping season, current levels might prove "unsustainable" during the fourth quarter when volumes usually dip and new ships are due to be delivered.

On the Asia-Europe trade Goldberg predicted a traditional June-August peak and said that so far volumes had remained mostly unaffected by the Euro crisis. "It seems more of a sovereign debt issue," he added. "It's not really rolling into the corporate and private sector."

On the trans-Pacific trade he said there would be a cargo build-up in the next three to four months with "a more normal peak season of restocking pre-Christmas" than witnessed in 2010 or 2011.

"But," he added, "I wonder about the fourth quarter."

Read Full Article