Commodity market news on March 10, 2022

SMALL INDUSTRY NEWS

WORLD Commodity Highlights DAY 10.03

The world's import-export and logistics businesses are worried that the West's continued introduction of sanctions against Russia may put the global supply chain of goods and services, which has been under heavy pressure after the epidemic. Covid-19 disease, wobbly. First of all, many shipping lines are suffering the consequences of the conflict, typically many countries such as the UK and Canada decided to suspend the operation of ships owned by Russia, and possibly soon other countries in the bloc. EU.

The recovery of the global air transport industry is again facing the risk of capacity loss and escalating rates.

A recent report published by Clive Data Services, since the Russia-Ukraine war officially broke out two weeks ago, the capacity of air freight has been narrowed, especially the The rate of flight routes from Europe and Northeast Asia fell 22% from the previous week. Meanwhile, the impact from the sharp increase in oil prices also caused freight rates to escalate at the beginning of the year although demand did not increase.

Accordingly, the average freight rate from Japan to Europe increased by nearly 15% to US$9.4/kg of cargo, while the freight rate from South Korea increased 13% at US$8.6. Even the routes in the Europe - Asia Pacific region are not yet full, but fares have also seen a 5% increase. In addition, there is currently only one cargo airline, Cargolux (Luxembourg), with an additional war risk surcharge. The situation becomes more complicated when many flight routes connecting Europe to Asia now have to change routes to avoid crossing Ukraine's airspace, making transportation costs even higher.

The global supply chain of goods continues to experience difficulties due to war after a long time fighting the epidemic. The global air freight supply chain is inherently more fragile than that of traditional sea freight; Today with the war situation in Europe and successive sanctions on Russia may turn this industry upside down again at a time when the impact of Covid is better controlled. In addition, another factor that causes freight rates to increase by air is due to travel and tourism activities.
international has been resumed. Many passenger routes have been increased in capacity compared to last year, causing many airlines to start shrinking the cargo space.