Global shipping logjam decreases New Zealand's export volume

PostTime:2022-08-16 10:32:39 View:9

GLOBAL shipping disruption is continuing, with two out of every three ships caught in what some call a "traffic jam", reports New Zealand's Rural News Group. Kotahi Logistics CEO David Ross says the shipping sector remains "very much in the middle of global disruption". Speaking at the NZ Primary Industries Conference in Auckland last month, Ross pointed out that some NZ trade lanes had lost 30 per cent of capacity due to ships being caught in this traffic jam. One of the key measures of global shipping is schedule integrity - how many containerships are arriving and departing on time against their published schedule. Normally, shipping schedule integrity is around 80 per cent, meaning four out of every five ships call in at the right time. However, disruptions over the past three years have seen it drop below 30 per cent, said Mr Ross.  

EU calls for views on block exemption for liner shipping

PostTime:2022-08-16 10:28:51 View:9

THE European Commission has launched a call for evidence inviting feedback on the performance of the EU legal framework which exempts liner shipping consortia from EU antitrust rules, reports Athens-based Safety4Sea. The commission has also sent targeted questionnaires to interested parties in the maritime liner shipping supply chain on the impact of consortia between liner shipping companies, as well as of the Consortia Block Exemption Regulation (CBER) on their operations since 2020. Interested parties can provide comments until October 3. EU antitrust rules generally ban agreements between companies that restrict competition. However, the CBER allows, under certain conditions, shipping lines with a combined market share of below 30 per cent to enter into cooperation agreements to provide joint cargo transport services, also known as 'consortia'. The CBER is due to expire on April 25, 2024. The Commission therefore needs to carry out an evaluation of the CBER on how it has functioned since 2020.  

Sri Lanka gives the nod for China survey ship to dock in its port

PostTime:2022-08-16 10:05:12 View:9

SRI Lanka announced last Saturday it has agreed that the Chinese survey vessel Yuan Wang 5 can dock at its southernmost port, the Chinese-run Hambantota today (August 16), despite security concerns raised by neighbouring India and the United States. Foreign security analysts describe the Yuan Wang 5 as one of China's latest generation space-tracking ships, used to monitor satellite, rocket and intercontinental ballistic missile launches, reports Reuters. Both China and India have tried to expand their influence in Sri Lanka, which is facing its worst economic crisis in its post-independence history. India has provided more help to Sri Lanka this year than any other nation. But it fears its bigger and more powerful rival China will use the Hambantota port near the main Asia-Europe shipping route as a military base. Sri Lanka formally handed over commercial activities at the port to a Chinese company in 2017 on a 99-year lease after struggling to repay its debt. The Pentagon says Yuan Wang ships are operated by the Strategic Support Force of the People's Liberation Army. Last Friday, India rejected claims that it has put pressure on Sri Lanka to turn the vessel away. "We reject categorically the 'insinuation' and such statement about India. Sri Lanka is a sovereign country and makes its own independent decisions," Arindam Bagchi, a foreign ministry spokesman, said.  

PSA International remains king in terminal operator rankings

PostTime:2022-08-16 10:04:02 View:9

SINGAPORE's PSA International has been crowned again as the leading container throughput terminal operator according to Drewry's latest Global Container Terminal Operators Annual Review and Forecast report. Processing 63.4 million TEU last year, PSA International was tailed by APM Terminals (which saw a massive 10.3 per cent increase in box throughput) and Cosco Shipping, processing 50.4 million TEU and 49 million TEU respectively, according to London's Port Technology. Global container port capacity is projected to increase by an average annual rate of 2.4 per cent to reach 1.38 billion TEU by 2026, according to senior analyst Eleanor Hadland. However, the worsening economic and geopolitical situation has led to a downgrading of the cargo demand outlook, and as a result container port utilisation is now projected to moderate to 70 per cent in 2025 compared to Drewry's 2021 projection of 75 per cent. While the majority (70 per cent) of terminal operator investment plans remain focussed on existing assets, there has been a "notable increase in the number of greenfield projects," Ms Hadland notes - with CMA Terminals, Hutchison and TIL all expected to add 4 million TEU or additional greenfield capacity by 2026. Ms Hadland commented: "The renewed appetite for greenfield projects shows improved confidence in the market outlook. However, the ability of CMA Terminals and TIL to secure volume guarantees from CMA CGM and MSC gives these companies an advantage over non-carrier affiliated operators." Global supply chain disruption resulted in increased cargo dwell times in 2021 which generated additional storage charges, lifting terminal operators' revenue growth above that which could be justified on the basis of volume recovery alone. Port congestion does not appear to have adversely impacted financial performance, despite the widespread decline in productivity levels. The revenue raising mechanisms (ie, paid-for overtime, storage charges) have so far proven to be sufficient to offset the additional congestion-related operating costs, Ms Hadland writes. Operators also cite the continuing cost control measures implemented in response to Covid as having a positive impact on margins. "Once global supply chain disruption eases, which is now expected in H1 2023, there is heightened risk that revenue gains will retreat as dwell times return to pre-pandemic levels," she added. Capital expenditure bounced back in 2021, rising 31 per cent year on year. In general, favourable terminal operator financial performance has translated into robust balance sheets. With the exception of Cosco Ports and ICTSI, net debt fell, leading to a reduction in net gearing by 8.5 percentage points to 54.7 per cent.  

Hapag-Lloyd H1 profit triples, but uncertainties abound

PostTime:2022-08-16 09:59:05 View:6

GERMAN shipping line Hapag-Lloyd reported a bumper first half of the year but echoed its peers in saying that its outlook for container shipping remained highly uncertain. Hapag-Lloyd concluded the first half of 2022 with an EBITDA of US$10.9 billion, while EBIT rose to $9.9 billion. Group profit nearly tripled to $9.5 billion compared to last year, reports Ventura, California's gCaptain. "We have benefitted from significantly improved freight rates and look back on an extraordinarily strong business performance on the whole in the first half year. At the same time, a steep rise in all cost categories is putting increased pressure on our unit costs," said Rolf Habben Jansen, CEO of Hapag-Lloyd AG. Revenues increased in the first half year of 2022 to $18.6 billion on the back of higher average freight rates, which hit $2,855/TEU compared to an average of $1,612/ TEU in H1 2021, and a stronger US dollar. Global supply chains remain under significant pressure due to persistent capacity bottlenecks in ports and congested hinterland infrastructures, leading to longer turnaround times for ships and containers, Hapag-Lloyd said. Overall, transport volumes in the first half of 2022 were on a par with last year, at approximately 6 million TEU. Hapag-Lloyd's result would have been even better if not for significantly higher expenses for container handling and charter ships, as well as by a 67 per cent increase in the average bunker price, which rose to $703 per tonne compared to $421 per tonne in H1 2021. Looking ahead, Hapag-Lloyd has raised its full-year forecast by as much as 30 per cent from previous estimates, as announced July 28. EBITDA in 2022 is now expected to be in the range of $19.5 billion to $21.5 billion, up from $14.5 billion to $16.5 billion previously, and EBIT in the range of $17.5 billion to $19.5 billion, up from $12.5 billion to $14.5 billion. For comparison, Hapag-Lloyd posted "extraordinarily strong" operating results in 2021, with EBITDA of $12.8 billion, up from $9.6 billion in 2020, and EBIT of $11.1 billion. The July 28 guidance noted "significant uncertainty" in the market, namely from the war in Ukraine, continuing disruptions in global supply chains, and the effects of the Covid-19 pandemic. Recent guidance from Maersk and HMM included similar caution, while ONE is holding off on providing guidance altogether. "We are currently seeing the first signs in some trade lanes that spot rates are easing in the market. Nevertheless, we are expecting a strong second half of the year," Mr Jansen added. "The currently still strained situation in the global supply chains should improve after this year's peak season. Our customers can continue to rely on us to do everything in our power to transport their goods to their destination as smoothly as possible. At the same time, we will continue to focus on our quality and sustainability goals as well as on further implementing our Strategy 2023." Further out, a wave of newbuilds set for delivery in 2023 is likely to outstrip shipping demand. Global containership capacity growth is expected to be 7 per cent in 2023, compared to demand growth of 3 per cent. "Over the upcoming 24 months, we clearly see that supply growth will outpace demand growth," said Mr Jansen in his earnings call with analysts. Overall for the industry, analyst John McCown of Blue Alpha Capital believes container shipping profits will come in at $256 billion, $36 billion more than his prior estimate in April and significantly higher than 2021's record profits of $148 billion.  

Rhine's low water levels mean German shipping ships less

PostTime:2022-08-15 10:42:47 View:11

LOW water levels on the Rhine River are causing problems for German industry, which is hindered by high energy costs, disrupting supply chains, and inflationary prices, reports Radio Deutsche Welle. The water levels are dropping due to hot temperatures and lack of rainfall in the region. Ships could not move through the key waterway fully loaded, with transport minister Volker Wissing calling for the river to be dredged. Long term, Mr Wissing declared it was necessary "to shift more traffic from road to rail and waterways". Mr Wissing stated that the planned dredging of the Rhine was the project from a recent German government study into long-term travel strategy. "We need to eliminate bottlenecks on the Rhine at certain points. We need the waterway," said Mr Wissing said. The investment would cost US$183 million, while 40 per cent would be for accompanying ecological measures. Mr Wissing already campaigned for the deepening of the Rhine between St Goar and Mainz. It would allow ships to carry 200 tons more cargo. Said Kiel Institute for the World Economy (IfW) economic expert Jils Jannsen: "In 2018, when navigation on the Rhine was last hampered by low water for an extended period, industrial production decreased by about 1.5 per cent at its peak," "It could be an additional burden that shipping is a relatively important means of transporting energy commodities."  

Shipping lines face pressure as freight volume falls

PostTime:2022-08-15 10:41:38 View:10

GE Shipping's CFO G Shivakumar declared rates are falling as congestion in Chinese ports eased while cargo demand dropped, reports New Delhi's Financial Express.   The Baltic Dry index declined 23 per cent in one month and 53 per cent in a year. The index provides a benchmark for sea freight, moving primary raw materials, with it recently standing at 1,560 points. "The moderation in rates in recent times has been due to factors like slowdown in global iron ore and agriculture trades and subdued demand from China. The Russia-Ukraine conflict has also impacted the trade as grain transportation from Ukraine has been impacted," said Icra vice president Sai Krishna.  

Port of Savannah's container boom accelerates, up 18pc in July

PostTime:2022-08-15 10:37:53 View:10

THE Port of Savannah's container business increased 18 per cent year on year in July as the port worked overtime to cope with the extra volume, reports Fort Lauderdale's Maritime Executive. Last year was the port's best ever for container volume, and it has exceeded its record-breaking 2021 performance increasing by seven percent 2021's year-to-date figures. Import volume has more than doubled since before the pandemic, according to Georgia Ports Authority executive director Griff Lynch. "The Port of Savannah has clearly become a preferred east coast gateway for shippers globally, including cargo diverted from the US west coast," said Mr Lynch. To accommodate the extra traffic, GPA accelerated the construction of a US$34 million container yard earlier this year. Last week, it extended gate hours to 0400 to 2100, adding two extra hours on to the early-morning shift. This has been popular with truckers, the port says, and the new time slot drew in 3,000 gate transactions over the course of the first week. For context, the port's gate operations averaged 15,000 truck moves per weekday in July, including both import and export transactions. GPA is also investing heavily in expanding capacity. It has eight new ship-to-shore cranes on order, and a new berth at Garden City Terminal is on track for completion by July 2023. The improved berth will add 1.4 million TEU of berth capacity, and the nearby Garden City Terminal West project will add another one million TEU of yard capacity in 2023-24. While GPA is planning for long term growth, Mr Lynch told the Wall Street Journal that the port also expects a slowdown towards the end of 2022, driven by the impact of inflation on consumer spending.

Port of Rotterdam 'provides insight' into ship waiting times

PostTime:2022-08-15 10:36:50 View:9

THE shipping community can now get data on containership waiting time on the Port Performance website page opened by the Port of Rotterdam Authority, the port authority announced. This shows the waiting times for containerships in Rotterdam, Hamburg, Bremerhaven and Antwerp. The graphs are based on AIS data from eeSea and are updated every Monday. "Logistics chains change continuously. Chain partners are expected to anticipate deviations at acceptable costs. Reliability is the key word. By providing insight into port performance indicators, smarter choices can be made, existing capacity better utilised and the performance of the chain improved," said the port authority. The plan is to provide insight into the efficiency of container handling in the port by drawing up, measuring and publishing performance indicators. To be able to provide insight into this, data sharing between all chain parties is necessary. "The data on ship waiting times is already available. This is therefore the first step towards providing insight into port performance. In time, additional indicators will be added," said the website. In addition to the insight into the performance of the port of Rotterdam, insight is also provided into the performance of the three surrounding ports in northwest Europe. These ports have the same sailing schedules and this has an impact on performance," it said.  

Long Beach tops July volume record by 0.13pc to 785,843 TEU

PostTime:2022-08-15 10:33:14 View:9

THE Port of Long Beach had its busiest July on record having lifted 785,843 TEU, just topping the July record set last year by 0.13 per cent. Imports declined 1.8 per cent to 376,175 TEU while exports were down 0.5 per cent to 109,411 TEU. Empties were up 2.8 per cent to 300,257 TEU. "We are continuing to seek solutions to improve efficiency as a record-breaking number of containers have been moved," said Port of Long Beach executive director Mario Cordero. "We hope to relieve some of the stress points by continuing to support a transition of the entire supply chain to 24/7 operations and ensuring our industry partners can track containers with our new Supply Chain Information Highway data solution," he said. Said Long Beach Harbour Commission president Sharon Weissman: "Our waterfront workforce continues to ensure trade moved through the port at a record-setting pace. We continued to strengthen our partnerships with labour and industry to ensure our spot as a leader in transpacific trade." With the July result, the Port of Long Beach has broken monthly records in six out of the last seven months. The port has moved 5,793,621 TEU during the first seven months of 2022, up 4.6 per cent from the same period last year.  

Container shortage raises rates to Brazil, say fruit producers

PostTime:2022-08-12 10:19:54 View:27

 A CONTAINER shortage is one of the main reasons for the increase in import freight costs in Brazil, according to the Brazilian Association of Exporting Producers of Fruits and Derivatives (Abrafrutas), reports Fresh Plaza news portal of the Netherlands. The price rises began shortly before the pandemic, in March 2020, worsening with the lockdown, which caused the closure of borders and shops. According to recent data, the median freight from Asia, one of the main importers in Brazil, was US$ 1,900 , in January 2020, for US$ $9,800 in the same month of 2022, an increase of 416 per cent . The difference between the prices of global freight and freight from Asia is explained by the modal used to transport the cargo, which can be used by land, between countries in South America, and sea and air, between more distant countries. Despite global shipping seeing a 24 per cent decrease in June 2020, when it reached $1,200, prices continued to rise. In 2022, it reached the mark of $2,700, an increase of 122 per cent compared to the same period.

Carriers urged to keep to schedule as North Europe volumes fall

PostTime:2022-08-12 10:18:18 View:20

THE two largest north EU hub ports, Rotterdam and Antwerp-Bruges, handled fewer containers in the first half of 2022 than in the same period the year before, reports London's Loadstar. Extended dwell times caused yard density and terminal congestion, increasing both significantly. Ocean carriers initially dealt with chronic congestion by skipping calls and overlanding containers at smaller ports. There are suggestions for more night shifts and weekend work to overcome supply chain disruptions. Rotterdam saw 6.2 per cent less throughput across its box terminals in the first six months, at 7.3 million TEU, while neighboring Antwerp-Bruges saw a 4.4 per cent decrease to 6.8 million TEU. Rotterdam attributed the volume decline to a loss of traffic to and from Russia. It declared container vessels were "no longer able to comply with their sailing schedules." The port handled 5.5 per cent fewer calls in the first half of this year compared with the previous year, while those vessels saw a 6.1 per cent increase in their container exchanges. "This results in peaks of activity at the terminals, which are already very busy, since containers are left for longer periods because ship arrival times are more unreliable," said the port.