Name: European Freight Market Update 10 March 2026
Uploaded: 2026-03-11T07:49:09.096Z
Duration: 38 min 11 s
Description: European Freight Market Update 10 March 2026

Transcript for "European Freight Market Update 10 March 2026": Hello, everyone, and thank you for attending today's European freight market update. My name is Jannik, and I'm the senior manager ocean freight for the German speaking region at Flexport. Before I introduce you to our first speaker, we'll go over a few quick housekeeping notes to help everyone get oriented. On your screen, you will see a sidebar to the right of the main stage where you can submit questions. At the end of the presentation, we will host a q and a and answer a few audience questions. So be sure you get your question in early. In the same sidebar, you will see a tab labeled docs. This is where you can download a copy of today's slide. Okay. Now a brief legal note. Please keep in mind that all information provided in this session is based on the situation at this current time and may not be customized to your specific business requirements. We always recommend reaching out to a Flexport expert to discuss your particular situation. Here is today's agenda. We are going to share the latest updates of European's air and ocean markets, review key customs developments, and provide recommendations to keep your freight moving. Now let's hand it over to air freight. Arno, what are the latest news here? Hello, everyone. My name is Arnaud. I'm the head of airfreight for the German speaking markets at Flexport. I'm very happy that we have a big list of participants in this FMU today. And I now walk you through the latest news about mainly the Middle East crisis, which I think is top of mind of everyone. And I think there's no more important topic when it comes to air freight at this moment. So again, a quick recap what happened since February 28. Still, most air spaces remain closed in The Middle East, which is, of course, due to safety reasons and the ongoing military activity in the region. We have The UAE as well as Qatar, who reopened partially the airspace, and there are some flight operations already going on. But it's very it's still on limited scope. So we have Emirates, which are based on the data which we received from our friends from FlightRider24. Emirates back at 50% of their flights and Qatar and Etihad Airways, with a still very limited amount of flights they are operating. In general, this is like 13% of the global airfreight capacity, which has been grounded on the February 28. So it's still a big hit that we have to digest in terms of available capacity. And I come to the separate markets and the impact on these markets in a later slide. On the airport operations, same here. It's restricted operations, and Dubai is here the most active airport despite the news we had over the weekend. But all airports are able to handle freight. They can handle imports as well as exports. There had been corridors opened from The UAE to Oman as well as to Saudi Arabia for freight that needs to move in and out of The UAE as as well as out of Qatar to get supplies into these countries. But this is mainly used for asset supply that or demand into these markets or out of the commodities markets. It's very rarely used for transit cargo. Of course, there are some recoveries happening where cargo that is stuck in Doha, Dubai or Abu Dhabi that's getting trucked over the border, but it's like a seven to eight days transit that you need to consider including all the customs formalities because it's a cross border move into Saudi Arabia. On the carrier side, aside from the Middle Eastern carriers, we have all European and U. S. Carriers as well as Asian carriers who completely stopped the operations into the Middle Eastern region. This hasn't changed, and we will clearly closely monitor here the situation. There are some carriers who have made some exceptions. So we saw some flights from Virgin operating from London into Dubai. But since it's a point to point carrier, it's not having much impact for cargo that is moving in transit via The Middle East from Asia or from Europe into Asia. What is also the case and we all see it when we go to the gas station, the operating costs because of increasing oil prices are also increasing tremendously for the airlines. Few kerosene prices are going up. We had like when you can see publicly available sources like the jet fuel price in Singapore, you see a big spike in the prices for the jet fuel and this results now into the first increases in the fuel surcharge. Lufthansa the Lufthansa Group announced a fuel surcharge increase already of, what was it, EUR0.35 or EUR0.40 for some markets. We have Air France KLM who implement a war risk surcharge starting March 26, where the numbers are not yet confirmed. And there it goes, not only because of increasing jet fuel prices, it's also because of, in general, increased cost for the operations, less payload because you have to move like the South or the North Coast corridor, which then requires the airplanes to carry more fuel and then limits the payload of the airplanes. When we go to the next slide, we see that is what we have today as today's capacity heat map. We clearly see two sections with which are deep red. So we have Vietnam, Cambodia. Vietnam was already in the last FMUs and also in the last month, a very hot market because of strong demand of the secondary sourcing aside from China and like growing production in these areas, same as Cambodia. And these markets are, in particular, served also with a big share from Middle Eastern carriers. So here, you have a capacity cut, which is significant and therefore also capacity access is very, very critical. It's like basically prebooking time needs to be at the moment nearly seven seven to eight days to get the booking placed with an airline if you're not booking via an express or premium product. And some carriers already stated that they are not accepting bookings or they're not able to accommodate any new bookings until March. So here, it's a very, very fragile situation. And now every every cargo needs to find its way through secondary hubs like Incheon, Hong Kong, Singapore and also making these hubs now more congested. And this is mainly also still on the European corridor. So five westbound from Asia into Europe, where we see this dramatic development on The U. When it comes to the Transpacific, it's also elevating but not as critical as we see into Europe. So there, the capacity is still manageable aside from Vietnam, India and Bangladesh. Coming to the subcontinent and Bangladesh, here is also the exposure to Middle Eastern carriers is massive. So that's why the impact here is also much, much stronger than for other markets that we have here on the map. When we go to the next slide, an overview of what has happened and where are we now. So this is the first was, we call it the Middle East Blackout, where we lost 13% of global capacity from the Middle Eastern carriers, which was overall 20% capacity cut. We had like rates going up from the ICs, so Indian Subcontinent countries and Southeast Asia lanes by 50100%. Demand was still relatively soft, which was why the rates have not going up more than this 100%. So it was still like kind of softer demand after Lunar New Year. But overall, the situation elevated very, very quickly as you all notice when you move cargo on this trade. The next where we are now or where we are basically ending now is the Frasier reopening. Let me go quickly next. And it's also this red box moves. Reopening of airspace in The Middle East, where we see that it's new freight new flights are getting installed, freight is operating, charters operating to reduce the backlog. That's where we're now. We're still not at a level where we could say the situation capacity wise is moving in a normal phase because it's still too much of capacity that it's out. But we see that the rates stabilize out of the Southeast Asian markets and are not increasing that much anymore as we have seen from the first week of this crisis. What we all but what we see is on the demand side, we see the traditional quarter and fiscal year end, which is kicking in now. So we have a lot of bigger corporate companies having their fiscal year end, March. And traditionally, it's already like a peak season after Chinese New Year, and that starts now to build up. And then we come to the next level, which is the post Lunar New Year recovery. Here, we have basically that additional demand from fiscal year end or quarter end. We have ecom, which is now again increasing in volumes after Lunar New Year, and that is now coming together with these bypassing congested hubs where cargo is getting moved now into North Asia. And so we see another spike, and we expect another spike North Asia within the coming days where we then will see also here rates increasing to a very substantial amount. When it comes to what you should focus on now, if you not already have done it, it's you need to secure capacity access at least for the next three weeks. Nobody knows how long this crisis will go. We have now a lot of pressure due to the high oil price globally. But we will not we it's impossible to forecast really how long this will impact the airspace closures and also the activities of these airlines and the oil price. But you need to make sure that you have capacity secured for your steady flows with giving commitments to forwarders to airlines for premium service that you also your pre bookings are not getting bumped with express bookings. That's really what's what is crucial now. On the rate side, you need to be prepared for more volatility. We have PSSs that are getting announced. We have war risk surcharges, fuel surcharges getting announced, and they will increase the pricing. So be prepared for spikes that you need to most probably absorb due to the increasing demand and to secure capacity access if you have not secured capacity yet. So that's a bit what we expect on the rate side. And from demand, ensure that you are having a good rolling forecast for the next few weeks that you already know with your procurement teams or with the forwarders that you can share with them how much capacity do you need, how much capacity does the forwarder needs to procure for you to secure within the BSA or as an additional capacity as an overflow if you need to have if you expect more demand to quarter end as transparent be as transparent as you can while sharing it because it's crucial to have the right amount of freight the right amount of capacity available for your freight. If you overbook your allocations or you prebook a shipment with one ton and you hand over to the forward two tons, they will have massive problems to get this absorbed because airlines are very restricted in increasing bookings for the price they have agreed before. General crisis management recommendations. It's always, especially in corporates and big corporate companies, the decision making process. So it takes a few days to make a decision to move a freight on Express or to upgrade your service level. So make sure that you have a very transparent discussion with your service provider and preauthorize maybe thresholds where you say, okay, if the rate goes up 30, please keep the cargo moving. I need it. I need it because of fiscal year end. I need it because the production is waiting on the other end so that you don't lose time, space and also maybe a good schedule because of the internal decision making process. When you share rolling forecasts, enable your forwarder to secure capacity with you also when also with a commitment and make sure you understand what is the cancellation period for that committed capacity you gave to the forwarder. So you prebook three tons four times a week, seventy hours seventy two hours before the the gate in at the airport. You are still able to to cancel the booking. Make sure that you understand that and that you also know what are the conditions of this capacity agreement that you have with your forwarders that you're not getting surprised with, I canceled twenty four hours because production was late or I had to change some paperwork and then you're getting hit with a full invoice of that freight that you have to pay and which is very costly at this moment. For all the participants in this FMU who are running RFQs now, check really if you can postpone the RFQ. The RFQ timing in this crisis is is super difficult to price for any forwarder. One forwarder is hedging a bit, the other forwarder is buffering in a bit. So it's you most probably will get a very big spread of rates, which none of them will be very close to where the market really will be in the next three weeks. So either you allow PSS and you in your RFQ or you try to postpone it or you shorten the validity of the RFQ just to be sure that the rates you procure are also rates where you can ship and can move move your freight. Good. That was air freight, and I hand it over now to Jannik for an ocean freight update. Thanks a lot, Anu. Let's kick it off for Ocean. No surprise that we also start with with update in in regards to The Middle East. And you will also hear a couple of topics that that might overlap a bit with the colleagues from the ocean from the f rate. Whilst there have been only a few transits through Strait Of Hormuz, all container vessel transits have stopped since the March on the 1,700 TEU vessel, Saffin Prestige. The attack that luckily caused no injuries forced the crew to leave the vessel where it is still at anchor roughly a week after the incident. The closure of one of the busiest ocean ocean passages early last week potentially trapped 200,000 TEU in capacity and impacted an even higher number as carrier were forced to take immediate action, such as suspension of new big bookings to and from The Middle East, implementing war risk surcharges that easily reached four digit US dollar amounts, and lately encouraged the ocean carrier to use their terms and conditions of the bill of loadings and terminate existing vessel voyages with immediate effect. Especially in this last measure, can be extremely painful for clients as container might be transferred to the next safe port, which is neither the port of loading nor the final destination it was booked to. As such, you will have container be sitting at ports where they're basically not needed. On the right hand side, you can see a snip of Flexport new release tool Atlas. Atlas is a real time assisting system showing vessel movement, different routes, and also port data. So you will have the link in the presentation and can can test it out. If you test it, you can press d on your keyboard, and it would directly you will directly see an over overview of several points of interests, such as such as the Suez Canal or the Strait Of Hormuz. It might become very interesting and and user friendly also over the next couple of days and weeks as we expect congestion in a couple of ports to to basically increase simply due to the fact that we have departures of vessels into the direction Middle East that basically need to find a different port or place to anchor as the passage to to the Middle East is not safe and is not used at the moment. Let's jump to the next slide and have a closer look on the impact of last week's and also this week's news. Last Friday's SCFI saw a moderate increase and is sitting at 1,452 US dollar per TEU. That's far east to to North Europe. What started last week and also continues this week, if we if we check on the phase westbound, are revised FAK rates from Asia to all response rates. So not only North Europe, but also the Mediterranean and also Africa. Validities here need to be checked individually and, of course, also the amounts on on different services and carrier. What can be said is that the increases are significant and already passed the 4,000 US dollar mark within March. So means be a date or departures within March. This week's SCFI, which is going to be published on Friday, should react based on those announced rate levels. The second topic that most of us that are commute commuting by car already learned the hard way is the historical increase of the oil prices. I mean, Arno just just just touched based on it. The Strait Of Hormuz is known for a huge amount of oil and gas being shipped through. And as such, the amount per barrel oil increased to more than 100 US dollar yesterday morning based on the on the closure. The immediate increase forced truck companies, but also ocean carrier to react with emergency fuel or bunker surcharges that come into effect also in the March onwards. The exact start date and also here percentage of the additional fuel or the amount that becomes applicable needs to be checked individually as there are slight differences between the carriers. Overall, and that's one of the slight differences between air, I think, it needs to be said that operations from Asia to especially North And South Europe are running normal after Lunar New Year and after the blank sailings, after the holidays. The trade itself is geographically not attached to the Middle East, and the majority of container vessels was transiting around Africa anyway. So even the the changed routings again around Africa will not face major major disruptions at least service wise until now. It's still the case that the idle fleet is very low. So that means that the vast majority of of container vessels are in service and accommodate global global demand. Let's switch the topic and go to the next slide as we wanted to to give everyone a brief summary after one year of of reshuffled alliances. Pretty much twelve months ago, the the Gemini Gemini Corporation was was built by the Danish Maersk and German carrier, Hapag Lloyd, with a clear plan to become best in class and the most reliable carrier perform performing with a hub and spoke system. After those twelve months in service, we can confirm that they have been successful in terms of becoming the best. So with the reliability above 75% on certain trains, they outperformed their competition here, but did not reach the overall goal of more than 90% reliability. With the latest move of HAPAC to acquire the Israeli ocean carrier SIM, the Gemini Corporation will also add more capacity into their network once those once this merger has been completed. Both Ocean Alliance and Premier Alliance announced network changes starting from April 2026 to improve reliability and transit time as they lag behind. Standalone carrier MSC remains by far the biggest in terms of capacity, and that will not change in 2026. Let's move to the last ocean satellite and give a quick rundown on our recommendations. With the latest news, the market will most likely change fast. As such, we encourage you to be agile and to stay transparent with your partner. That does also mean to diversify your rate strategy. In case we see front loading in Asia paired with those high FAK rates, there's a chance that SDFI will increase quite significantly during the next weeks. Depending also on the situation in The Middle East, the fuel and bunker might change fast, which leads me to the next recommendation. Make sure you talk in frequent timelines with your partner and get as many as much visibility as possible and also as many information as possible. Last, and also, Arno mentioned it, there are contracts in Ocean running out March. Make sure you have a grace period in case there's no direct extension in place based on the current market conditions and the development. Let's switch to customs. William, please give us the latest information about the customs. Alright. Thank you, Jannik, and thank you everyone for for joining us today on the FMU. I'm Will Mahle, business development manager for customs and trade advisory, which was, like, a long winded way of saying I'm the guy that focuses on all things customs here in The US, helping importers understand, you know, the crazy situation we've gone through over the past year. This slide does a a great job of kind of highlighting what we've all gone through importing into The US. And I'll preface that that we're gonna be talking largely based on on US customs here. So if you do have any questions, we'd be happy to set up time to talk through anything more specific to the markets you imported to. But for today, we really wanna focus on the changing environment. Right? So you can see here, over the past year, we've we've had 52 executive orders. That's almost one per week, and that's impacting the overall trade tariff schedule. And when you look at, you know, other administrations, that number is is almost, you know, a little bit less than half of that. So you can just see how much the the environment has changed, how how much more complexity has been added into the market, and how that's resulted in all these other stats. So you can see the amount of tariffs collected, the average tariff rate. So it's added a lot of complexity, and it's understanding, you know, given the supreme court ruling, what you can do as importers to to try and get some of it back. So when you look at what the the state is today, and we can go to the next slide, the supreme court ruled that AIPA is is not illegal. So the the president wasn't within his rights to charge tariffs based on AIPA. And so now we're all kind of in a a limbo status understanding what's next. Right? So how do we position yourselves to get these refunds? You know, there's been a closed door meeting between the CIT and CBP last week that really talked through what that might look like. The CBP essentially asked for a pause for forty five days to come up with solution, and that's what we're we're currently pending on right now. So we're we're in a little bit of a limbo before we get that final say on how the CBP is gonna go forward with these refunds. But when we look at what we can do from an importer perspective, you know, we can talk through some recommendations that we have as Flexport. So if we go to the next slide. These are our recommendations. So as an importer, the the main things you really wanna do is get set up with your ACE account, which stands for automated commercial environment. That's really the the data repository for for customs. It's also how brokers and customs communicate. It's also where, you know, you can find all the information you need to understand your your tariff refunds, what that looks like from a size perspective. And then the flip side of that is to also be set up with ECH. So if you're importing through US entities, make sure that they're set up with ECH and customs. If you're a federal foreign importer of record, make sure you're you're you're nominating a notified party to receive those on your behalf so that customs has a place to to send those refunds to. The other thing we we're we're recommending is just do a a quick gut check of what that refund amount looks like. So we have two tools that we've launched recently that are great ways to to show you impact on the the refund perspective, but also ways for you to audit the work your your brokers are doing because that is a necessary step as we get to these potential refunds is making sure there's nothing else wrong from an entry level, whether that's how the tariffs were applied, how the HTS classification, if that's correct or not. So just doing audits on your entries, making sure, you know, there's nothing else that's gonna put you in jeopardy to to not take advantage of those refunds. And then lastly, one thing that you can do is file protests. You know, the the the language from the CP seems like it might be more of a a blanket refund, but, filing protests is a way to essentially keep those those entries open, or live so that, you know, if there ever is a change in terms of the potential mechanism for these refunds, you're you're still eligible for those refunds as well. So, we'd be happy to talk through any of these, you know, more tailored conversations with any importers, so feel free to reach out whether that's on US or EU customs. We'd be happy to talk. And with that, I'll turn it back to Yoni. Thanks a lot, William. Let's let's move on to the q and a. I have everyone on stage, and we have a question for Airfreight. So I know someone from the audience is asking how you would recommend to negotiate fixed pricing contracts right now. Okay. Difficult one. No. So what we would recommend is that if you have a pricing agreement that ends now with the first quarter and it's basically a classic winter schedule agreement and you are approaching now the summer schedule, we recommend to try to extend existing winter schedule rates or have an open discussion with the forwarder who's handling this service because it will be very difficult to implement new volumes for a new assigned forwarder in this current market conditions because everything is congested. We are very open and expect that then a PSS surcharge will apply. And that's for the contracts which are now transitioning from Q1 to Q2 or from winter to summer schedule contracts. So basically, work with two different approaches, keep the new partner in play with basically having them also or enabling them also to offer like a PSS to the contract rates and the same extent existing rates within PSS to ensure your freight keeps moving and your cargo keeps moving. In general, it's very important that if you want to have like one baseline to compare prices that you allow for us to offer a PSS for the certain period of time, which is not clearly defined, but basically ask for a base rate. And then with all the developments in the market that they can add a peak season surcharge or war risk surcharge or fuel surcharge. How you name it is, in that sense, a bit irrelevant. But you need to basically enable forwarders to have like more flexibility on the pricing to keep the cargo moving, to have no cut off your supply chain. Thanks, Good. Arno. We we received basically the the same question also for Ocean. So how to how to negotiate fixed pricing right now. And it it get it goes a little bit into into the similar direction. Right? There are basically different options. One option is you price the the long term rate itself based on on current market conditions from from, like, two to three weeks ago with clearly stating that it that it will have an emergency food surcharge and and possibly also emergency surcharge on on on the freight levels. But it depends on on volume, multivolitity, and also the type of rate you are looking for. In terms of floating agreements, of course, there's a little bit more flexibility when it comes to to finding a solution on the rate levels. We got a question on cost customs William. The question is, do I understand correctly that the tariffs charged by The United States over the full past year can retroactively be claimed back? Yes. So it's a little bit of a nuanced question, but the anything that's, was charged under I IEPA, so I e p a, and that's the fentanyl and then all your country specific tariffs, That was deemed illegal by the supreme court, so it's no longer being collected. Those tariffs have shifted to what's now section one twenty two. But right now, what we're waiting for is the mechanism for those refunds. So that's still up in the air. But to answer your question at a a very high level, yes, there are plans for refunds. We just don't know what that's gonna look like yet. Awesome. Thanks. We're a bit overtime, but we would continue with at least two more questions as they are coming in. Anu, we have another one on air. How do you see the current issues affecting China to United Kingdom air freight in the next few weeks in terms of lead time and also price? Good question. It's really depending here. The U. K. Is also one of the destinations, which is affected a lot by Middle Eastern carriers and the cancellations of flight operations there. We have Manchester and we have Stensted. We're having like 20% share of Middle Eastern capacity, and this is now off the market. So we expect that for The U. K, the available capacity will be still limited, in particular, the North, into Manchester. And that there will be also like the price will give you capacity. So you would need to it's expected in the next few weeks, urgent cargo, you need to upgrade it to express levels, that it's also getting like priority on the flights into The U. K. Lead time wise, we have there are options also to go via European carriers to with Cargolux via Luxembourg, Lufthansa, KLM and so on. But here, you also have like a trucking leg, which then adds one to two days of transit time, and that's something that your product needs to be able to absorb. And we have another one for Air. This time on on fuel surcharges. The question is, what's your suggestion to manage only the fuel as there are different percentages that are being become applicable? My personal view on fuel surcharge is that since the carrier base is so fragmented and also how they apply increasing costs is very different. I would prefer or would suggest to work more on a like a general surcharge, a PSS, peak season surcharge, which is then covering like an all in rate because you have a lot of carriers, especially in Asia, who even if they have a published fuel surcharge, they still quote you in an all in rate. And that makes it then very hard to compare. And then one carrier is like blending in more into the all in rate. The other one has like a smaller fuel surcharge or worse surcharge. So it will be very hard to compare carriers there. I would always look at all in price, and forwarders should be also able to give you a base all in rate with like a PSS, which then reflects what is the rate for access to capacity. Because at the end, it's the access to capacity that you need to be able to procure and not just displaying the oil market. Okay. William, we got another one on customs. Is there any indication regarding refunds for goods that have entered The United States via postal clearance. Not yet. We're still waiting for more information there. We should know more by the end of this forty five day period, but right now, we just we don't have the insight into the postal clearances just yet. Awesome. Thanks. There's one on Ocean that I would basically still want to answer. Anything else that you are asking, are happy to take it also offline. There was a question that based on on the presentation, there seems to be a higher risk impact on on air freight. What about sea freight? What expectations on on container availability and port congestions and ports from Asia to to Rotterdam? So based on on ocean carriers suspending the the bookings to Middle East and also ending voyages, there are some significant amount of of container that need to basically that need to be redirected. So there is a chance that that ports en route from Asia to to The Middle East, such as Tanjung Pilipas, also Singapore, or Indian ports would see some increase in congestion simply because they see more container unloadings and more vessel calls. So there is a there is a chance. What I wanted to state in the in the ocean presentation is that the overall trade from from Asia to to India and also to North And South Europe is not directly impacted as geographically and in terms of services from the ocean carrier, The Middle East services are not directly linked to the other services. Alright. Thanks everyone for your for your time and the and the participation. We would conclude it, and we you will receive a link to the recording and also to the slides. Thanks again for attending. Have a great day, and dial in for the for the next freight market update. Thank you.