Ocean Freight Update January 24: Rates climbing due to Red Sea attacks plus recommended action

January 2024 Ocean Freight Market Update: Navigating the Challenges of Red Sea Attacks and Persistent Shipping Disruptions

Ocean rates continue to climb due to the recent attacks and ongoing disruption in Red Sea, with rates climbing significantly week-on week. Key actions to make sure you don’t get caught out by these increases:
 

• Current contract management is key to understand when current contracts are coming to an end, and when you will need to start engaging the market
   
• Work with Shipping Lines and Freight Forwarders to break down and justify any surcharges and changes to shipping rates,• Review of service types. If you are shipping LCL, explore consolidation into FCL
   
• As the Red Sea issues ease, or are resolved, deciding when to negotiate your rates is going to be key. Keep any immediate increases as a surcharge, as they are easy to remove when the situation eases
   
• If you have to negotiate new rates in the next few months continue to monitor regional logistics news, but also challenge the shipping lines and freight forwarders to put in measures that will reduce/remove costs from agreed prices once normality returns to the shipping routes

These Red Sea issues are adding complexity to the Ocean Freight market and H&Z are helping its clients navigate through this situation and put in place clear transparent agreements that improve on current market pricing and also allow clients to move freight around the world in the most cost effective means, managing risk, price management and transparency.