Market Intelligence [March 2024] Logistics Market Intelligence Report

Leading index of the US has been constantly recovering at 99.70 hitting the bottom of 98.8 in February 2023.
OECD expected step-by-step stabilization of inflation (3.8% in '23 → 2.7% in '24).

※ An economic cycle is largely divided into four stages. Expansion phase : If it is in an upward trend with more than 100 / Downward phase : If it is in a downward trend with more than 100 / Contraction phase : if it is in a downward trend with less than 100 / Recovery phase : if it is in an upward trend with less than 100

In Feb, entered an expansion phase with a PMI of 51.5 in the U.S. manufacturing industry, the highest level in 10 months of production due to a significant increase in new orders.
The signs of slow spreading of "stock reduction policies" led to increased production.

※ A leading indicator of the economic situation as a result of a monthly survey of more than 400 corporate purchasing/supply managers

76.7상승(3.0)

Due to geopolitical instability, OPEC+’s voluntary production cuts and strong Chinese crude oil demand, the avg. WTI price in February was $76.7 per barrel (up 4.2% MoM).
OPEC+'s extension of production cuts until the 2Q ‘24 and geopolitical instability in the Middle East are expected to exert short-term upward pressure.

2,165상승(35)

SCFI continues to decline to 1,979 on 1st Mar after hitting 2,218 in the first week of Feb due to seasonally weak demand after the Chinese New Year.
Average freight rates in North Europe fell 11.5% to $2,626 in Feb (MoM) due to weaker demand compared to North America and increased competition among carriers after the Chinese New Year.

Downward pressure on freight rates continues due to a slowdown in demand recovery on main routes after the Chinese New Year.
The composite Index is forecasted at 1,519-1,715 points for 2Q 2024.

Red Sea diversions are easing supply pressures temporarily, but full-scale oversupply is expected to develop once operations return to normal.
Fleet growth for 2024 and 2025 up 0.5%p from January forecast, but demand unchanged, widening supply-demand imbalance.

[Asia] UAE, India forge trans-continental trade corridor agreement
- UAE and India signed agreement to establish transcontinental trade corridor connecting Europe and India.
- The Corridor runs from India through the Arabian Sea to the UAE and extends through Saudi Arabia, Jordan, and Israel to Europe and it will strengthen economic cooperation between the both.

[Americas] No change in Panama Canal restrictions before April
- The deputy administrator of the Panama Canal Authority (ACP) says he does not expect any changes to the current vessel transit restrictions until at least April. ACP will assess water levels after the end of the dry season to make a decision.
- The Red Sea crisis has increased the demand for transit through the Panama Canal, but water levels must return to normal before ships can transit unrestricted as before.

[Europe] Spain begins supply chain disruptions due to Red Sea crisis
- Supply lead times are increasing and orders are falling due to the Red Sea crisis. Key indicators of Spanish industry contracted again in January, although production, new orders, employment and inventory levels declined less than in the previous month.
- The Jan 2024 PMI closed at 49.2 points, slightly higher than Dec's 46.2 points, with a slight decline in production and orders, particularly for monthly export orders.

HKG-EUR 4.18상승(0.1) HKG-US 4.52하락(0.5)

Average air freight rates from Asia rose from mid-Jan to early Feb (W07), but turned downward in W08.
Hong Kong-Europe is changed to W10 $3.83 from W07 $4.44 and Hong Kong-US is changed to W10 $4.27 from W07 $5.06.

Hong Kong-U.S. $3.9 to $4.5 in Q1 , $4.7 to $5.0 in Q2, and $4.3 to $4.5 in Q3
Hong Kong-EU $4.0 to $4.1 in Q1 , $3.8 to $ 4.1 in Q2 and $3.6 to $3.7 in Q3

After the peak season in Dec ‘23, international cargo demand fell -7.6% in Jan ‘24 compared to the previous month.
The demand for international airfreight increased 19.8% from Jan 2023, 4% increased from before COVID-19 (Jan 2019).
The supply of international airfreight increased by 18.1% from Jan 2023, 5.2% increased from before COVID-19 (Jan 2019).

[Asia] Asia-Europe maritime and air hubs, freight traffic surge
- During the seven weeks of 2024, cargo traffic to Europe at major Asia-Europe Sea & Air hubs such as Dubai, Colombo, and Bangkok increased by more than 50% year-on-year.
- Shippers are also choosing sea-to-air transport to replenish their European inventory, and the trend of increased freight traffic is expected to continue over the next few weeks.

[Europe] DtoC Fulfillment is a top priority for EU commerce and supply chain companies
- 84% of vendors and supplier leaders say Direct-to-Consumer has become the top initiative.
- As customer interest increases, companies are reportedly significantly increasing DTC sales and investing in fulfillment technology.

[Americas] Red Sea crisis & Lunar New Year drive January air cargo volumes
- Global air freight volumes up 10% year-on-year in Jan ‘24 due to earlier-than-usual Chinese New Year and Red Sea crisis.
- Despite rising demand, air freight rate fell 12% month-on-month and 21% year-on-year to $2.27/kg. Analysts say that freight rates have normalized in January as expectations for rising rates have already been reflected in advance in December.