Continued congestion at US ports
Demand for goods rose by 2.7%
The global economy grew at a moderate but solid pace, keeping overall growth for 2024 in line with previous expectations. Nevertheless, growth remains unevenly distributed across different regions and sectors. The service sector remains the main driver of economic expansion, while the fragile recovery in manufacturing has now stalled.

In terms of regions, the US is still the main driver of global economic expansion. The Federal Reserve cut interest rates by 50 basis points to ease recession fears, and US consumers remain optimistic, helped by a strong labour market and continued wage growth. Goods demand rose 2.7% from last year. Although stable core inflation and a recent drop in consumer confidence are some concerns for US consumption, overall, continued robust economic growth is expected.
Container trade remained strong, with an estimated growth of 4-6% over last year. Much of this growth was driven by exports from China and Southeast Asia. Imports grew above average in Latin America and North America, while imports in Africa declined.
Shipping
The Drewry WCI composite index fell 4% to $3,095 per FEU, which is 70% lower than the peak of $10,377 during the pandemic in September 2021. However, this remains 118% higher than the 2019 (pre-pandemic) average of $1,420. There is still some limited congestion at US East Coast and Gulf ports, caused by the ILA's three-day strike. Although operations have largely recovered, some analysts expect that the strike could still lead to capacity problems and equipment shortages at Asian ports.
Freight
Overland freight in North America declined by 0.3% in volume compared to last year in the months of July and August. However, indications are that the sector has stabilised, with volumes improving in the contract freight segment. The supply of truckload continued to increase, leading to downward pressure on rates. At the same time, limited capacity in the Less Than Truckload (LTL) segment contributed to higher rates.
Air freight
The global air cargo market has shown a mixed picture in recent months. In terms of capacity, growth slowed slightly in September to 5% compared to last year. However, growth is still mainly driven by large long-haul aircraft, which can carry more cargo than smaller aircraft. This type of transport remains the main driver of expansion in international air cargo.
In terms of prices, global freight rates remained relatively stable, although there were significant price differences between different trade routes. One positive development was the fall in jet fuel prices in September, which declined more than the fall in crude oil prices, pushing refining profit margins to $13 per barrel.
Source: AGF