Agriculture Shippers Expect Tighter Capacity

Most shippers of agricultural products are securing the vessel space and equipment they need right now, but they expect space to tighten and freight rates to rise over the next three months, according to an industry survey.

U.S. agriculture has been at the forefront of the country’s push to increase exports, but shippers are concerned the slashing of trans-Pacific capacity, due to weak imports, will limit outbound space.

More than 85 percent of the agriculture shippers that responded said they could get the space they needed as long as they booked ahead about three weeks, according to a survey of its members taken by the Agriculture Transportation Coalition. And about 83 percent said they usually or always get sufficient containers to carry their shipments.

However, the mood changed dramatically when the shippers looked ahead to the winter months, the peak season for exports. About 81 percent said they see vessel space and equipment availability tightening over the next three months.

Freight rates this year have been favorable, but 52 percent said they expect rates to go up “a little” over the next three months and 10 percent believe rates will go up “a lot.” A third of the respondents said they expect freight rates to remain flat and only 5 percent said they expect rates to go down “a little.”

-- Contact Bill Mongelluzzo at bmongelluzzo@joc.com. Follow him on Twitter @billmongelluzzo.