Market Status: Elevated

Capacity: Tight | Space Availability: Limited | Schedule Reliability: Moderate | Outlook: Strong demand expected through July.

As we enter July, the China–Australia ocean freight market remains highly dynamic, with strong demand continuing across all major trade lanes.

While additional vessel capacity has been introduced and further services are scheduled to commence towards the end of July, this will only partially offset the capacity withdrawn during May and June through blank sailings and service changes.

Vessel space remains tight, with booking demand continuing to exceed available capacity across many services. As a result, carriers are still experiencing cargo rollovers, particularly on peak sailings and premium service offerings.

The majority of shipping lines servicing Australia allocate a significant proportion of their vessel space to direct contract customers. We are hearing from multiple carriers that many of these customers are currently importing between 10% and 20% above their original forecasts and are paying FAK market rates for this additional volume, further contributing to ongoing capacity constraints.

Key factors influencing current market conditions include:

• • Continued strong export demand from China.
  • Capacity constraints resulting from blank sailings and service changes implemented during May and June.
  • Ongoing disruption to global vessel deployment following events in the Middle East.
  • Carriers reallocating vessel capacity to other high-demand global trade lanes.

The introduction of additional extra-loader vessels throughout July, together with new scheduled services later this month, should gradually improve capacity and assist in reducing current backlogs. While this is a positive development, it will only replace a portion of the capacity removed over recent months. Accordingly, we expect demand to remain elevated throughout July and into the traditional peak shipping season.

DEAN Insight

Whilst additional capacity entering the market is a welcome development, our view is that it is unlikely to materially change market conditions in the short term. Based on current booking levels and discussions with multiple shipping lines, the additional space is expected to be absorbed quickly by existing backlogs and continued demand. We therefore anticipate tight capacity and elevated market conditions to remain throughout July.

What this means for importers

Clients should continue to expect:

• • Tight vessel space across most China–Australia services.
  • Longer booking lead times than normal, lead times of two to four weeks are becoming increasingly common.
  • The potential for shipment rollovers on selected sailings.
  • Ongoing carrier schedule changes and service adjustments.

Although additional capacity is entering the market, we do not expect conditions to normalise immediately. Flexibility around cargo-ready dates and sailing schedules will remain important over the coming weeks.

Our recommendation

To minimise disruption to your supply chain, we recommend:

• • Confirming purchase orders and bookings as early as possible.
  • Providing cargo-ready dates well in advance wherever possible.
  • Discussing any time-critical, seasonal or promotional shipments with your DEAN World Cargo representative as early as possible so the most appropriate routing and capacity options can be secured.

Our teams continue to monitor market developments daily and remain in regular contact with shipping lines to secure the best possible outcomes for our clients.

We will continue to provide updates as market conditions evolve.

Should you have any questions regarding your upcoming shipments, please contact your DEAN World Cargo representative.