Logistics Market Trends – August 2023

Highlight: Influence of Economic Trends on CMA CGM’s Q2 2023 Revenue and Logistics Performance

During Q2 2023, CMA CGM reported USD 8.4 billion in shipping revenue, a 47.9% dip YoY. EBITDA reached USD 2.2 billion, down 76%, with an EBITDA margin of 26.2%, a 30.7-point drop. Average TEU revenue stood at USD 1,491, down 10.3%. Robust volumes persisted in North-South routes, while Transpacific and Asia-Europe faced headwinds from reduced consumption and inventory changes. 

Despite a 0.3% dip YoY in Q2 2023, the Group transported 5.60 million TEUs, reflecting an 11.5% rebound from Q1, aligned with business cycles and increased demand. 

In logistics, Q2 revenue reached USD 3.8 billion, with EBITDA at USD 356 million, up 4.7% YoY. The segment’s stability, amidst trade fluctuations, is attributed to enhanced supply chain services from acquisitions like Ingram CLS, Gefco, and Colis Privé. European contract logistics improved, while U.S. e-commerce weakness persisted. Finished vehicle logistics thrived on supply chain disruptions and strong demand. 

Additionally, during Q2 2023, CMA CGM proposed acquiring Bolloré Group’s freight forwarding and logistics, aiming to boost global expertise. 

Ocean Freight Updates – August 2023

Key
++	Strong Increase
+	Moderate Increase
=	No Change
–	Moderate Decline
—	Strong Decline

Outbound

Middle East – North America

The trade route between the Middle East and North America faces a situation of limited space availability in the Gulf region, resulting in heightened rate volatility.  

Capacity — (=) 

Rate — (+) 

Middle East – Asia     

The trade lane connecting the Middle East and Asia has witnessed a consistent downward trajectory in spot rates on a monthly basis, leading to a prevailing trend of stable to diminishing rates. 

Capacity — (=) 

Rate — (=/-) 

Middle East – Europe 

While rates from the Gulf remain unchanged, there is a noticeable ascending pattern in spot rates month after month. The capacity will remain constant, with available space for shipments. 

Capacity — (=) 

Rate — (=) 

Middle East – Latin America

Steadiness characterizes rates from the Gulf in the trade route towards Latin America, with variable weekly space availability. Spot rates are anticipated to maintain a consistent stance. 

Capacity — (=) 

Rate — (=) 

Inbound Updates (H3)   

Asia – Middle East

The trade lane connecting Asia to the Middle East is projected to exhibit capacity and spot rates stability over successive months. The prevailing tight space conditions are expected to contribute to this rate stability. 

Capacity — (=) 

Rate — (=)  

North America – Middle East

Frequent blank sailing is a characteristic of South Atlantic ports, while the Northeast Coast offers more options amidst ongoing tight space conditions. Improvements in capacity are notable from the U.S West and Gulf coasts, albeit with persistently constrained space. 

Capacity — (=) 

Rate — (=) 

Latin America – Middle East

The trade route connecting Latin America to the Middle East demonstrates month-over-month consistency in both capacity and spot rates. Anticipated steady demand post the Eid-ul-Adha holiday is expected to underpin this stability. 

Capacity — (=) 

Rate — (=) 

Europe – Middle East

Steady conditions are projected to prevail in capacity and spot rates along the trade route from Europe to the Middle East. The trade lane overall exhibits stability, characterized by relatively open space availability. 

Capacity — (=) 

Rate — (=) 

Air Freight Updates – August 2023

Demand: The growth in cargo volume remains subdued for the current month. However, a cautious upswing in volume is anticipated during the impending peak season. Elevated inventory levels and a decline in purchasing power collectively contribute to the prevailing low-demand scenario. 

Capacity: Present capacity adequately meets existing volume requirements. Belly capacity experiences a positive trajectory owing to heightened travel demand. Notably, no significant backlogs have been reported, and global capacity has witnessed an appreciable 11% increase compared to the previous year. 

Rates: Certain trade lanes indicate a marginal uptick in rates, yet the market maintains its competitive nature. Over the long term, stability is foreseen in rates during the latter half of 2023. 

The Middle East and Air Carriers

Middle East-based airlines have increased their international capacity by a noteworthy 15.7% year-on-year. Despite the global contraction in Cargo Tonne-Kilometers (CTKs), carriers from the Middle East have managed to narrow down their annual decline from 6.7% in April to a more modest 3.1% in May. 

Asia

The second quarter of 2023 has showcased an upswing in volumes as compared to the preceding quarter. Softened demand attributed to the traditional slack season is projected to persist until an anticipated upturn by the conclusion of the third quarter. Notably, no capacity-related concerns are apparent, with passenger flight capacity being augmented to cater to the demands of the summer travel season. Rates are expected to maintain stability, with improvements on the horizon in August. 

America

Latin America maintains an available capacity for pivotal trade lanes, with aggressive spot rates reflected in diminished demand. Meanwhile, contract rates remain resilient. The region is currently experiencing a low season for perishable volumes. Across North America, air freight demand between the United States and China remains manageable; however, the introduction of additional capacity may potentially influence air rates. It’s pertinent to note that the Felipe Angeles International Airport (AIFA) in Mexico City now facilitates international cargo arrivals alongside domestic flights and is poised to accommodate cargo departures as well. 

Europe

Air freight demand experiences a global reduction, except for instances of peak commercial activity, notably within South China. An increase of 2.1% in rates for shipments to Europe is observed from Hong Kong. Discussions regarding a potential strike among air control managers in mainland Europe introduce an element of uncertainty that could disrupt summer vacation flights. 

Shipping News – United Arab Emirates 

The Government of Dubai has introduced Administrative Decision No. 2 of 2023 within the framework of the Dubai Directive, focusing on enhancing transparency in the assessment of local sea container charges. The primary objective of this initiative is to establish a foundation of transparency, accountability, and competitiveness across Dubai’s maritime sector, ultimately benefiting Beneficial Cargo Owners (BCOs) who rely on these services.  Read More 

OOCL has unveiled the IQAX eBL, a pioneering digital solution designed to facilitate the issuance, transfer, endorsement, and comprehensive management of Ocean Bill of Lading. This digital platform stands as a pivotal answer to the complexities of international trade, transportation, and financial settlements. Learn More 

As of July 18th, 2023, Maersk is reintroducing the ‘Online Payment Remittance’ feature, a strategic move aimed at elevating the overall customer experience. This enhancement is anticipated to expedite the processing of payment receipts, contributing to a more streamlined and efficient customer interaction process. Read More 

A notable update to the UAE GCC Dangerous Goods Certified Entities list was executed on July 20th, 2023. This update serves as a formal notification of the renewal status for Freight Forwarder DG Certification #351 pertaining to Fast Logistics Cargo FZCO, Dubai. Read More  

In response to congestion issues in Mersin, CMA CGM has taken proactive measures by implementing evacuation plans for vessels CC MEKONG and SEASPAN AMAZON. This strategic maneuver is aimed at alleviating the congestion-related challenges in the mentioned port. 

Hapag Lloyd, in a bid to address operational realities, has made adjustments to the congestion surcharge structure. Commencing from July 17th, 2023, a new surcharge will be applicable to reefer and dry containers originating from the Far East, Middle East, and India Subcontinent regions. This update necessitates careful consideration in cargo planning for shipments originating from Mersin, Turkey. Read More 

Overview of Global Factory Output – August 2023

The Drewry’s World Container Index (WCI) has displayed a notable increase of 11.8%, reaching a fresh value of $1,761.33 per 40-ft container during the initial week of August. 

United States of America (USA)

The Purchasing Managers’ Index (PMI) for USA services has been documented at 52.3, marking a decline from the preceding month’s figure of 54.4 in June. Despite this modest decrease, the service sector continues to be a prominent catalyst for growth within the US economy. Notably, business activity exhibited an upward trajectory in July, albeit at a pace that is the slowest since February. It is worth noting that the momentum of expansion has been diminishing further from the peak observed in May, primarily attributed to a significant contraction in new business growth. 

United Kingdom (UK)

The PMI for the United Kingdom has experienced a decrement from 53.7 in June to 51.5 in the month of July 2023. This reduction underscores the potential negative impact of elevated borrowing costs on both consumer spending and business confidence within the UK’s economic landscape. Furthermore, the service sector encountered the feeblest uptick in new work over a span of six months. 

China

China’s PMI demonstrated an augmentation, ascending from 53.9 in June 2023 to 54.1 in the month of July. This figure substantiates the sustained expansion of business activity within China’s service economy, a trend consistently observed for the seventh consecutive month. Notably, the overall upswing in new business during July has significantly contributed to this progression. 

United Arab Emirates (UAE)

The PMI for the United Arab Emirates underwent a modest shift, declining from 56.9 in June to 56.0 in July. This marginal adjustment in value indicates a tempering of the vigor in the UAE’s non-oil economy. The growth pace of new business has moderated subsequent to achieving a four-year high in June, accompanied by a slight contraction in output expansion. However, the value of 56.0 signifies a generally robust sector status, characterized by an improved market outlook. Enterprises have reported resilient growth rates in customer demand and job creation, contributing to the overall health of the sector. 

Global Interesting News – August 2023 

Freight News

Air

Cargo-partner offers Western Europe, Asia consolidation services Read More 

Global airfreight rates rise 2.9% Read More 

DHL Express to invest $192M into CVG expansion Read More 

Digital Pulse: Qatar Cargo offers real-time, personalized e-pricing Read More 

IAG Cargo revenue down 28.5% YoY in H1 Read More 

Maersk opens air cargo hub near ATL Read More 

Avion Express expands fleet to 50 aircraft Read More 

TAAG Angola to increase frequencies to Kinshasa Read More 

Air Astana signs codeshare agreement with Azerbaijan Airlines Read More 

cargo-partner introduces airfreight consols between W Europe and Asia Read More 

Abu Dhabi International Airport welcomes back Air France Read More 

Saudia Cargo expands European services Read More 

Tailored animal transportation: From pets to conservation Read More 

dnata’s flower handling expertise takes flight in Amsterdam Read More 

Qatar Airways Cargo and Airlink play vital role in responding to humanitarian needs Read More 

The Future of Ground Handling: Embracing Digitalisation and Automation for Success Read More 

Qatar Aviation Services Cargo receives IATA’s smart facility operational capacity certification Read More 

Qatar Airways Cargo takes fresh to the next level Read More 

Hong Kong Air Cargo targets expansion Read More 

Los Angeles Airport takes on cargo project Read More 

Hawaiian Airlines receives first Amazon A330 freighter Read More 

Challenge Group remains committed to its Liège hub Read More 

Ocean

Seafrigo acquires PML, expands operations Read More 

Transatlantic carriers must change course and rethink expansion plans Read More 

EU initiative will ‘kick-start’ large-scale production of sustainable maritime fuels’ Read More 

Box terminal operators feel the pain as peak season disappoints Read More 

Carriers blank voyages and look for port call inducements as demand slows Read More 

Box lines slam on the brakes in a charter market feeling the pain Read More 

Maersk’s bottom line saved by fuel savings Read More 

New fuel regulation could cost as much as 12,000 dollars a day per tanker Read More 

Tanker scrapping is expected to increase again from 2024 Read More 

Longshore labor unrest a new daily fact of life for North American shippers Read More 

‘REGLOBALISATION’ Trends Emerge in Port Call Data Read More 

One Hundred Ports: Container shipping bids farewell to the boom times Read More 

Saudi Arabia’s Neom port ‘won’t compete’ with regional box terminals Read More 

Ocean carriers warn FMC against regulating prices Read More 

All-time high: Shares of container company Textainer still rising Read More 

Iranian Oil Remains Stuck Off US Coast Read More 

Russia Blocks Cargo Vessel Transits Through the Kerch Strait Read More 

Tow-away regulations in Rotterdam for incorrectly moored barges Read More 

Valenciaport calls for tenders for the air quality network control service Read More 

CMA CGM enhances FAL 1 service Read More 

Hapag Lloyd increases rates from Asia to US East Coast Read More 

CMA CGM increases FAK rates from Asia to North Europe Read More 

CMA CGM revises overweight surcharge from Asia to East Africa Read More 

CMA CGM implements port congestion surcharge for reefer cargo in Cameroon Read More 

CMA CGM introduces container scanning fee in Congo Read More 

Maersk increases rates from Far East to Med ports Read More 

Adani to boost Mundra port capacity by 800,000 TEUs amid steady volume growth Read More 

COSCO, CMA CGM add La Spezia Container Terminal to MedGulf service Read More 

RTA’s marine transport services between Dubai and Sharjah to resume from August Read More 

Mawani, Antwerp Port sign landmark agreement to strengthen trade relations Read More 

Saudi Spark, Hutchison ink agreement for dryport concession Read More 

King Abdullah Port: Boosting Saudi Arabia’s economic shift Read More 

Mawani: Saudi Ports register 6.79% growth in June container volumes Read More 

Ground

Ukraine conflict prompts rerouting of China-Europe rail freight to bypass Russia Read More 

Nikola surpassess 200 orders for hydrogen fuel cell trucks Read More 

Tenstreet provides smoother connection between drivers, carriers through continued acquisitions Read More 

Railroads reach deals with unions on sick leave, conductor training Read More 

Railroads, car haulers scramble to meet auto delivery demands Read More 

Tracking the speed, dwell and cars of Class I railroads Read More 

Autonomous Trucks – Improving Cost, Speed, And Efficiency for Logistics Companies Read More 

The Average Price of Truck Cranes in Mexico Drops by 24% to $13,510 per Unit Read More 

Cargo-partner launches new trucking solution between China and Europe Read More 

UKEF backs latest deal for high-speed rail in Turkey Read More 

Less-Than-truckload: A True Shipping Advantage Read More 

Rail freight from Canada to U.S. continues to drop after ports strike Read More 

Oman and Etihad Rail Company inks logistics agreement with integrated steel company Jindal Read More 

Development Road: Iraq launches unit to oversee $17 billion rail link with Turkey Read More 

Dubai completes major road development project, slashes journey times Read More 

GCC Railway: New rail network to connect Saudi Arabia, Bahrain, and GCC Read More 

Yellow’s Competitors Likely to Seek Carrier’s LTL Business Read More 

June Truck Tonnage Ticks Down 0.8% on Annual Basis Read More 

Other

DHL Group reports 16.4% revenue drop Read More 

AIT invests in pharma shipping Read More 

Lufthansa Cargo and Kuehne+Nagel partner on paperless lanes Read More 

Overconfidence drives digital forwarder layoffs Read More 

Raft to use $30M in funding for AI solutions Read More 

Optimizing cargo loading with quantum computing Read More 

DHL takes green logistics to the next level Read More 

Hapag-Lloyd completes Americas terminals acquisition Read More 

DHL raises guidance despite weak market Read More 

Canada’s strike is over, but supply chains could take weeks to recover Read More 

CMA CGM Braced for Weaker Profit Before Demand Picks up in 2024 Read More 

Walmart aims for sustainable clothing in its supply chain Read More 

Fashion brands still have work to do on supply chain transparency: report Read More 

Bolloré Logistics in the ranking of the 75 leading Green Supply Chain Partners carried out by Inbound Logistics Read More 

Freight Companies are not Expecting a Robust Peak Shipping Season Come Fall 2023 Read More 

Pallet Prices Are Still Soaring as Shortages Hurt U.S. Producers Read More 

UK Green Subsidies Need Revamp to Meet Net Zero, SSE CEO Says Read More 

C.H. Robinson Profit Tumbles on Weak Freight Market Read More 

DHL Group to acquire MNG Kargo Read More 

Businesses see biggest value in transport visibility Read More 

The ‘peak’ of peak season is here Read More 

Logistics technology market grappling with pandemic period overhiring Read More 

Saudi Arabia climbs eight places in Lloyd’s list 2023 rankings Read More 

Saudi Arabia to establish 59 logistics zones by 2030 Read More 

AD Ports Group, China’s CMEC GROUP ink agreement for global infrastructure development Read More 

Schneider Acquires M&M Transport Read More 

3PL News

Cainiao opens 6-warehouse logistics park in Jakarta Read More 

DHL to acquire Turkish parcel delivery provider MNG Kargo Read More 

Maersk builds new distribution centre in Singapore to support regional logistics Read More 

Warehouse automation expected to pick up after hitting ‘rock bottom’ Read More 

Last-Mile Innovations: Exploring Alternative Delivery Methods Beyond Traditional Couriers Read More 

Efficient Warehouses Fit Sustainable Operations Read More 

DHL Group strengthens its presence in Turkey with parcel delivery firm acquisition Read More 

On the Heels of the Nearshoring Boom, Logistics Startup Nuvocargo Raises $36.5M to Modernize US-Mexico Trade, Expands to all major US-MX border crossings Read More 

Prozo Planning to Add 5M Square Feet of Warehousing Space by 2026 Read More 

Maersk plans SG facility for omnichannel fulfilment Read More 

How Are Companies Engaging With Customers Around Deliveries In 2023? Read More 

Understanding First-Mile vs. Middle-Mile vs. Last-Mile Delivery Read More 

The Vital Role of PPE in Warehousing Operations Read More 

Launch of Robots and Human Co-workers Collaboration Read More 

Viewpoint: Another nail in the consumer spending coffin Read More 

E-fulfillment prepared for hectic? – read the free online magazine Read More 

Retailers struggle with returns, while there is profit to be made with good organization of the process Read More 

The micro-fulfilment revolution Read More 

Maersk inaugurates first cold store facility in UAE, strengthens integrated logistics solutions offering Read More 

Georgia Distribution Center to Team NFI, Bradshaw Home Read More 

DHL Express Opens Atlanta Cargo Facility Read More 

Trade and Customs

Russian drones strike Danube grain export port Read More 

Typhoons and downpours clog China’s logistics flows and port traffic Read More 

US lawmakers look to end sale and import of commercial kangaroo skin products Read More 

Export of U.S. Aircraft Launching Gear Sees Mild Dip to $9.2M in May 2023 Read More 

Trade Management Market Size to Surpass US$ 2 Bn by 2032 Read More 

It is Official – UK Electronic Trade Document Bill becomes Law Read More 

War-Weary Ukraine Farmers Curb Plantings in Blow for Food Supply Read More 

UK export minister kicks off Barclays-ICC UK trade digitisation taskforce Read More 

The Dutch are Europe’s biggest online fashion shoppers Read More 

Weathering Drought in the Panama Canal Read More 

Ecommerce Logistics News

UPS, Teamsters reach tentative labor deal avoiding strike Read More 

BigCommerce Launches Google Cloud Ecommerce Features Read More 

How eCommerce Professionals can Use Supply Chain Visibility to Delight Customers Read More  

E-commerce managers Swinkels: ‘E-fulfilment is spearhead in customer experience’ Read More 

Amazon Fresh Offers Grocery Delivery to Non-Prime Members Read More 

Amazon to Double Number of Same-Day Delivery Facilities Read More 

FedEx Pilots Reject Proposed Multiyear Contract Read More 

Amazon Prime Day Drives All Online Sales Up 6.1% Read More 

Amazon Fleet Electrification Sees 5,000 Rivian Vans on Roads Read More