On the wires…

·       Deputy Minister Sibiya’s wife linked to R2bn KZN feeding scheme tender scandal.

·       Trump pushes ahead with 30% tariffs on SA.

·       30 killed in food queue by Israeli fire – Gaza civil defence.

·       Germany to respond to any unilateral Israeli moves on Palestinian territories, minister warns.

·       Maharaj, Bavuma take top honours at CSA Awards.

·       Piastri accepts F1 title chase looks like a two-horse race.

Hilarious quote of the day

“Be like a postage stamp. Stick to a thing till you get there.” — Josh Billings

The indicators…

Currency crackdown…

FXOne would like to thank Peter Schmidt- Loeffler from Leschaco for his valued insight into freight developments this morning.

Tariff Shock Disrupts Trade
A 31% tariff imposed by the U.S. on South African goods in April 2025 triggered sharp increases in shipping costs: Asia–SA container rates rose approximately 30% for 20′ and 45% for 40′ containers between April and June. Combined with Red Sea rerouting and a depreciating rand, this created one of the worst freight disruptions in recent history.

Steep Decline in Spot Rates: According to Xeneta, average ocean freight spot rates from China to the U.S. West Coast have dropped ~59% and ~43% to the U.S. East Coast since June 1, 2025—driven by oversupply and weak demand despite new trade deal hopes. Ships continue avoiding the Red Sea, using the Cape of Good Hope route—adding 10–12 days to voyages and causing a 19% year-on-year rise in emissions, significantly undermining global sustainability efforts

Trade Volatility & Geopolitical Pressures: The FT reports that U.S. reciprocal tariffs, Red Sea attacks, and instability in the Middle East are disrupting supply chains and driving rate swings. Prospective tariff extensions—on China, August 1 and U.S.–EU goods—could spur another surge in freight pricing and front-loading shipments.

Persistent Capacity Imbalances: Global ocean capacity growth continues to outpace demand, especially on Transpacific routes, leading to blank sailings and rate corrections. Rising concerns about fleet oversupply emerge as ship orders remain high and scrapping remains low.

Shipping Alliances & Market Control: The launch of the Gemini Alliance (Maersk & Hapag Lloyd) consolidation is showing increasing control over slot scheduling and pricing across major global lanes.

Strategic Trade Shifts: Reliable trade lanes are shifting away from U.S.–China routes toward intra-Asia and North–South corridors considering tariff uncertainty and geopolitical friction.

Cargo through OR Tambo airport has risen ~13% year-on-year (exports up 5%, imports up 14%), indicating strong growth in air cargo that has bypassed congested seaports.

Rates Cooling Off: Xeneta reports the first annual decline in airfreight spot rates since 2024—falling ~4% to USD 2.44/kg in May—as sentiment softens and jet fuel prices drop 20% year-over-year.

Rate Volatility Near Tariff Deadlines: The build-up toward new U.S. tariffs (effective August 1) is prompting pre-deadline air shipments across Asia-Pacific, tightening space and pushing rates upward.

On the radar…

Did you know?