MARKET UPDATE

UK & International

2nd 2024 Report

Market Summary update

Q1 2024 Report

Welcome to the 2nd 2024 report by KUKLA Beverage Logistics, which overviews key developments and challenges in the logistics sector, focusing on road, sea, rail freight and market trends across various regions.

Snapshot of Regional Market Trends

In 2024, Europe’s freight industry finds itself in a dynamic environment marked by labour shortages, regulatory advancements, and geopolitical tensions across road, rail, and sea freight sectors. The landscape is shaped by contrasting shifts: road freight continues to grapple with driver shortages and fluctuating spot and contract rates; rail freight is evolving with regulatory reforms aimed at improving capacity and efficiency; and sea freight faces record container volumes amid operational pressures and alliance restructurings. The following report dives deeper into the challenges and strategies that are defining each sector, reflecting a period of adaptation and resilience across global logistics.

OVERVIEW

Road Freight
The Ti, Upply & IRU European Road Freight Rate Development Benchmark Q4 2023 key data highlights:
Rail Freight
The unanimous adoption of the European Parliament’s TRAN (Transport and Tourism Committee) proposals on railway capacity marks a significant step forward for rail freight in the Single European Railway Area.
The proposed Regulation aims to enhance railway capacity and reliability by establishing an international, digital, and flexible system for managing and allocating railway capacity….
Sea Freight
New tolls on top of the high-cost base will keep upward pressure on rates, likely to sustain contract rates and limit further falls in spot rate growth. A shipping alliance, often called an ocean alliance, is a group of ocean carriers that create a cooperative agreement. This agreement covers several trade routes through collaboration among its members globally.
These groups of carriers commit to vessel-sharing agreements to help cover as much of the shipping market as possible. This means they gain access to vessels owned by other carriers. Often, carriers also agree to move containers on behalf of one another…

ROAD FREIGHT GLOBAL MARKET OVERVIEW

ROAd freight summary
The Ti, Upply & IRU European Road Freight Rate Development Benchmark Q4 2023 key data highlights:

Overview

Labour constraints remain a critical concern, as IRU’s preliminary data suggests nearly half of European logistics companies foresee difficulty in recruiting drivers for 2024, posing risks to both operational resilience and cost stability.

Digitalisation initiatives, such as Hungary’s implementation of e-CMR and Italy’s ratification of this digital consignment protocol, are part of the ongoing shift towards streamlining logistics through technology. These innovations are expected to reduce some operational inefficiencies, though labour shortages continue to strain overall supply chain continuity.

Three countries have announced changes to their toll fees which are not related to the Eurovignette Directive. Toll fees for heavy-duty vehicles have increased by 6.8% in Slovenia since mid-July 2024. Fees have also increased in Belgium since July. Hungary will implement a similar correction in January 2025.

SEA FREIGHT GLOBAL MARKET OVERVIEW

sea freight RELIABILITY
Schedule Reliability Graph

Sea Freight: Record Volumes and Strategic Alliances Amidst Disruptions

Ocean freight in 2024 has seen growth alongside challenges, with record container volumes and evolving alliances reshaping the sector. Global container demand rose 7% year-on-year, but operational strains persist due to costly detours, which reduce capacity and raise fuel costs, while labour unrest adds potential delays. Key alliance changes, including the Maersk-MSC split and Gemini Cooperation’s debut, will further alter East-West trade routes, promising diversified options in 2025.

Ocean freight has been both a growth area and a source of challenge in 2024, as record-breaking container volumes and alliance restructurings define the sector. From May to July, global container demand surged, reflecting a 7% year-on-year rise for the first half of the year.

According to Sea Intelligence, in August 2024, global schedule reliability improved to 52.8% and up to now, in 2024, it has stabilised within the 50-55% range.

However, operational pressures persist, notably due to the diversion of 360 ships (around 4.7 million TEU) via the Cape of Good Hope, a costly adjustment aimed at avoiding Houthi threats in the Red Sea. This diversion has reduced global containership capacity by approximately 7%, raising transit times and fuel costs while exacerbating port congestion.

Labour unrest further complicates ocean freight. The potential strikes in US East and Gulf Coast ports are not happening for now, while Germany also faces labour-related risks. Such disruptions threaten to redirect cargo, with the risk of widespread schedule delays.

Meanwhile, strategic shifts in key trade lane alliances are underway: the Maersk-MSC split in January 2025 and the Gemini Cooperation’s launch with Hapag-Lloyd will reconfigure East-West routes, offering diversified service options. (See Q1 report for details of the new shipping alliances q1-2024-report)

RAIL FREIGHT GLOBAL MARKET OVERVIEW

Rail freight summary

The European rail freight sector is undergoing substantial regulatory and infrastructural developments aimed at bolstering intermodal capacity and efficiency. The TRAN (Transport and Tourism Committee) proposals from the European Parliament seek to create a digital and international system for managing rail capacity across the Single European Railway Area. Although well-received, the reform proposals have been flagged for limited user consultation and oversight, underlining the need for robust stakeholder engagement.

Infrastructure investments are also driving expansion across key logistics hubs. Romania’s Port of Constanta, supported by a 750-million-lei rail connection project, and Spain’s 730-million-euro development at the Port of Barcelona are examples of Europe’s commitment to enhancing rail connectivity. In the UK, Southampton’s Solent Rail Terminal has made significant strides with its recent container handling success.

DP World’s new midweek service between London Gateway and Southampton demonstrates a growing focus on reducing road congestion through increased rail capacity. Collectively, these efforts highlight rail’s potential to provide sustainable, efficient freight alternatives within an integrated logistics network.

Sea Freight

Trade Lanes Overview
North America

Reefers

In the reefer market, seasonal demand and increased exports—primarily driven by a 13% rise in Brazilian beef exports—are intensifying pressure on already limited container availability. As these challenges impact equipment access and transit reliability, shippers are urged to anticipate potential delays and proactively manage supply chain continuity.

South America

South America is experiencing equipment shortages that are impacting freight schedules. The increased export demand, particularly in Brazil, is further straining container availability, requiring shippers to prepare for delays and potential disruption in service.

South Africa

Weather-induced delays at South Africa’s Durban Port, compounded by ongoing port congestion and equipment issues, continue to affect schedule reliability. Extended transit times due to unpredictable weather and port congestion underscore the need for shippers to plan ahead as equipment shortages are projected to persist into 2025.