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In its current report Global Freight Forwarding 2012, Transport Intelligence reports uncertainty in 2011 resulted in a “particularly volatile and difficult year for the freight forwarding industry.”
Ocean forwarders are being squeezed by higher rates and lower volumes on some key routes, Transport Intelligence reports.
Air freight forwarders face competition from ocean as shipments are shifted from air to water. This is on top of lower economic activity.
According to the report, the industry saw strong recovery in 2010, followed by reasonable growth in early 2011 and then significant weakness in the second half of 2011 and into 2012.
“Our research shows very clearly the negative correlation between rates and forwarders’ profitability,” said John Manners-Bell, CEO of Transport Intelligence. “The significant rise in sea freight rates at the beginning of the year, and a further rate increase in the last few weeks, will see forwarders come under pressure as they struggle to pass these rates on to their customers. At the same time, weaker volumes will hit their revenues,” he added.
Manners-Bell concluded saying freight forwarders are “remarkably resilient.”