TAKEAWAYS
With less than half of 2024 remaining, supply chain professionals are looking back at what has already transpired—and what issues are left to contend with before the year draws to a close. Thus far, the supply chain has faced several significant challenges with lasting global implications , including the effects of ongoing geopolitical tensions and the threat of labor strikes in the United States, Canada, and Europe. According to FTI Consulting’s Q2 2024 Transportation & Logistics Industry Update , the transportation and logistics market saw a surge in ocean freight prices and growing demand for air freight due to longer transit times caused by Red Sea shipping disruptions and congestion in Asian ports. However, an increase in capacity and the opening of new sea routes are expected to reduce freight prices in 2025 despite current T&L pricing pressures. TAILORED LOGISTICS SOLUTIONS FREIGHT & CAPACITY FORECAST
Here’s a roundup of the report’s findings from Q2 2024 and some upcoming predictions: Global Freight Market Outlook The global freight market shows steady growth in volume, reflected by an increase in the numnber of M&A deals and rising demand for air freight forwarding services.
- Increased volumes coupled with disruptions in major shipping routes have led to significant increases in demand for air and ocean freight in 2Q24. - Hostile developments in the Red Sea have presented manifold challenges for global trade , ranging from extended transit durations and capacity limitations to elevated expenses and increased uncertainty. - General cargo has shown faster growth than specialized products in 2024, due to increasing demand from ecommerce and disruptions in the container shipping sector. - Air cargo is set for a strong second half , driven by sustained ecommerce growth, increasing ocean shipping costs, and disruptions in the Red Sea. - Entering 2024, shippers expected a buyer’s market for ocean freight, with carriers adding capacity in 2023 and planning to do so again. Instead, global geopolitical events and high demand across trade lanes in 2Q24 have reduced available capacity and increased shipping rates . - Due to the necessity of rerouting via the Cape of Good Hope, new capacity added in 2023 and early 2024 hasn’t been sufficient to meet growing demand .
Source: FTI Consulting
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