Transpacific shippers preparing to begin annual contract negotiations with container shipping lines have been warned that the market for contract rates could be around 15% overpriced.
According to new analysis from SeaIntelligence Consulting, the normal correlation between the transpacific spot rate market, as measured by the Shanghai Containerised Freight Index (SCFI), and contract rate market, as measured by the China Containerised Freight Index (CCFI), has diverged in recent months.
Source: The Loadstar
Two commissioners at the Federal Maritime Commission, Carl Bentzel and Daniel Maffei, wrote a letter to President Joe Biden last week calling on the administration to prioritize coronavirus vaccines for maritime workers.
The letter notes that the International Longshoremen’s Association has reported 784 positive tests between March 2020 to Jan. 25, 2021, and the International Longshore and Warehouse Union and the Pacific Maritime Association have reported 1,034 COVID-19 cases among maritime workers in California, Washington and Oregon during the same period.
Source: Supply Chain Dive
Ship congestion around the ports of Los Angeles and Long Beach hit an unprecedented level, worsening the bottleneck at the busiest gateway for U.S. imports.
A record 38 container ships are awaiting berth space—36 at anchor and two more that were directed to wait in designated areas at sea until anchorages are available, the Marine Exchange of Southern California said in a note late Thursday. It’s the first time since 2004 that so-called drift zones have been used to manage traffic into the neighboring ports.
“This is a problem which does not have a short-term fix,” said Lars Jensen, chief executive officer of SeaIntelligence Consulting in Copenhagen.
Source: AJOT, Bloomberg
More ships are being held at departure ports in Asia for a week or more, as carriers wrestle with the recovery of their shattered schedules.
They have drawn a blank in their attempts to secure additional capacity to mitigate the impact of port congestion, and are warning shippers to expect more sailings to be delayed.
Hapag-Lloyd CEO Rolf Habben Jansen told customers today the carrier’s fleet was “fully deployed and stretched beyond capacity”.
Source: The Loadstar
Complex customs paperwork and red tape is proving a major hindrance to UK-EU trade, according to Make UK, which represents engineering and manufacturing companies.
A major survey it conducted revealed that some 61% of businesses are “enduring supply chain disruption – either importing or exporting to and from the EU – and 32% are having their supply chains impacted in both directions”.
Make UK said that companies are also struggling to prove the UK origin of their goods in order to qualify for zero-tariff access.
Source: Lloyd´s Loading List
A new Covid-driven bottleneck has hit the supply chain out of China: a severe shortage of truck drivers and air routes disrupted by crew restrictions.
Quarantine laws mean that yesterday was the last day to work and be out of quarantine by the Chinese New Year’s Eve on 11 February.
The result is that truck drivers are now self-isolating, and not working, before going to be with their families.
Source: The Loadstar
Cargo claims specialist WK Webster has details of yet another box spill in the north Pacific – the fifth reported lost overboard incident in less than two months.
Unlike other recent accidents, the latest box spill happened as the 14,300 teu MSC Aries made its way back from the US to China.
The Portuguese-flagged ship is reported to have lost 41 boxes last week while en route to Ningbo from Long Beach. Vessel tracking from MarineTraffic (see below) shows the likely moment where the accident happened, the vessel suddenly bearing north three quarters of the way through its journey.
Source: Splash 247
As competition for Mediterranean container traffic heats up, CMA CGM is set to operate a new container terminal at Egypt’s port of Alexandria.
The French shipping group will manage the multipurpose, 1.5m teu capacity facility, Pier 55, with operations commencing next year.
It is the second major box terminal deal for Egypt in six months and follows Hutchison’s August deal to develop a $730m terminal at Abu Qir, just 20km away, with the first phase of the 2m teu capacity facility also opening next year.
Source: The Loadstar
Long-term Asia-Europe ocean freight contract rates have seen a record rise this month, according to new figures from Xeneta.
Import prices to Europe on the digital rates specialist’s European XSI index increased by 19.3% in January compared with December 2020 to 132.67 points, with Xeneta noting that “this represents the largest monthly increase since the inception of the index, reflecting the unprecedented situation facing key trade lanes. As a result of this month-on-month rise, the benchmark is up 12.5% compared to the same period of 2020.”
Source: Lloyd´s Loading List
Some observers have compared IMO2020- the restrictions on sulfur in marine fuels which took effect on Jan 1, 2020 -with the Y2K drama of two decades back.
During the Y2K runup, there was much consternation and fears that all computers would stop running, shutting down commerce and everything else. Fast forward to the end of 2019, with great concerns that vessels could not source compliant fuel, or worse- that various blends would gum up cylinders in vessel engines.
Source: gCaptain
Singapore’s financially troubled container line, Pacific International Lines, received approval from the last of its creditor groups for a restructuring and recapitalization plan that the company had called its last hope to save the operations. With today’s vote, the privately held company plans to complete the restructuring this quarter.
The 50-plus-year-old container line had spent most of 2020 seeking to come up with an agreement on a rescue plan for its operations. In May 2020, they reached a standstill agreement designed to give the company time to negotiate the restructuring, but in November they went into technical default on $60 million in bonds when the company said it was unable to proceed with repayment on the notes that came due.
Source: The Maritime Executive
Charter broker Air Partner has reported a 50% increase in demand as a result of ocean freight supply chain issues.
Over the last few months the container shipping sector has experienced major supply chain issues due to a box shortage in Asia, a surge in demand and port congestion.
Air Partner chief executive Mark Briffa said: “As a result of issues affecting global shipping at the moment, transporting cargo via sea transportation is proving extremely challenging for businesses and supply chains, so we are experiencing a growing number of enquiries for air charter.
Source: Air Cargo News
