One day early last week, as Brexit-era regulations first roared through, a Northern Irish hauler dispatched almost 300 goods-laden trucks to Britain. Normally, there would be an immediate turnaround, with trucks carrying goods destined to Northern Ireland, or onto Ireland. After two days, however, only 100 made it back fully loaded. The rest were stuck waiting for cargo, as British shippers and their agents unsuccessfully grappled with new paperwork and other customs-related issues. The truck operator ended up recalling his empty trucks, eating about $33,000 in the process.
The irony is that Northern Ireland is part of the United Kingdom. However, under the new UK-European Union pact, the border between Ireland and Northern Ireland remains free and unimpaired. Northern Ireland continues to be governed by EU standards. Goods moving into the territory from Britain must be EU certified and cleared.
There are signs that spot rates from Asia to Europe might be beginning to cool at last.
Today’s Shanghai Containerized Freight Index (SCFI) comprehensive index inched up just half a percentage point this week to 2,885, which is 190% higher than a year ago.
The North Europe component eased back slightly, by $39, to $4,413 per teu, after putting on $650 in the previous two weeks.
Source: The Loadstar
Ocean Insights’ cargo delay statistics show how the bull run is wreaking havoc on the market, with surging rollover rates across major ports during December and most major carriers seeing increases in delays.
Industry analysts are calling it, “one of the strongest bull-markets for container carriers seen in the last few decades.” Triggered by a 30% collapse in demand for container shipments in Europe and the US at the outset of the pandemic, a subsequent 30% increase in demand has created unprecedented negative market conditions. Data released today by Ocean Insights highlights just how extensive delays have been, which ports and carriers are experiencing under capacity and a timeline of market volatility.
The world’s biggest shipping company demanded a more effective military response to surging pirate attacks and record kidnappings off the coast of West Africa.
The number of attacks on vessels globally jumped 20% last year to 195, with 135 crew kidnapped, the International Maritime Bureau’s Piracy Reporting Centre said in a Jan. 13 report. The Gulf of Guinea accounted for 95% of hostages taken in 22 separate instances, and all three of the hijackings that occurred, the agency said.
The attacks have pushed up insurance and other costs for shippers operating off West Africa, with some resorting to hiring escort vessels manned by armed navy personnel. A.P. Moller-Maersk A/S, which transports about 15% of the globe’s seaborne freight, said decisive action needs to be taken.
Source: Bloomberg, Supply Chain Brain
Air France-KLM-Martinair Cargo has confirmed to The Loadstar that it will not be passing on the cost of Brexit-related security changes on to its customers.
Last week, Lufthansa informed customers that, with EU law no longer recognising trucked cargo from the UK as secure, shipments departing the UK via road feeder services (RFS) for onward flights would be subject to charges of £0.15/kg ($0.20), or a minimum of £17.25.
Source: The Loadstar
China’s economy exceeded its pre-pandemic growth rates in the fourth quarter, enabling it to expand faster than expected over the whole year as major peers contracted.
Gross domestic product climbed 6.5% in the final quarter from a year earlier, fueled by industrial output and propelling growth to 2.3% for the full year, the statistics bureau said Monday. Economists surveyed by Bloomberg had predicted 6.2% expansion for the quarter and 2.1% for the whole of 2020.
“China has more than returned to trend growth,” said Raymond Yeung, chief economist for Greater China at Australia and New Zealand Banking Group. The strong rebound means authorities can “prioritize structural reforms rather than economic reflation” in 2021, he said.
Source: Bloomberg, AJOT
Full-year traffic figures from several airports last week reflect an upside down year dominated by the coronavirus pandemic in 2020. Passenger business slowed to a trickle with airlines closing most of their networks in the face of government lockdowns and other health measures, while cargo picked up the slack in some cases.
Hong Kong, the world’s largest cargo airport, experienced a 7% decline in cargo to 4.5 million tons, and served 87% fewer passengers. The airport handled 68,660 cargo flights during the year, an 18.3% surge compared to 2019. The damage to Hong Kong came in the loss of passenger traffic because so much cargo is transshipped from regional flights to long-haul passenger and freighter flights.
Source: Freight Waves, American Shipper
As the air freight market reheats after a fortnight’s lull, Lufthansa Cargo has blamed a high volume of cargo for its decision to “pause” its capacity guarantee.
It told customers that, “due to tense capacity availability, we are forced to pause the capacity guarantee of all speed options for continental flights out of Frankfurt, Munich, Vienna and Brussels”.
Source: The Loadstar
The Port of Long Beach, California ended 2020 with a string of records despite the challenges of a year impacted by the global pandemic. The port not only recouped the declines from the beginning of the year, but ended 2020 with the busiest month in its history, the most active quarter, and a record container volume for the full year.
“This record demonstrates the effort of our dockworkers and the port’s determination to collaborate with our partners to overcome the devastating economic challenges presented by COVID-19 and the trade war with China,” said Long Beach Harbor Commission President Frank Colonna.
Source: The Maritime Executive
Singapore is looking to enhance intermodal connectivity following a slight dip in container volumes last year.
Terminal operator PSA International reported 36.6m teu throughput at the port, down 0.9% year on year, but in comparison, the group’s international volumes rose 3.7%, to 50m teu.
Tan Chong Meng, PSA group CEO, said: “2021 continues to give us the opportunity to reset and reform, as a business and as individuals. The way companies and consumers engage, transact and collaborate has evolved at lightning speed.
Source: The Loadstar
A critical lack of ocean containers and capacity for ex-China exports, together with vessel schedule disruption, are continuing to drive modal shift to air that is adding to a squeeze on air freight capacity already stretched by buoyant demand generated by COVID vaccine transport, PPE and the B2C e-commerce boom, according to a leading air charter broker.
“Currently, we are seeing that the problems in ocean freight are putting a lot of pressure on air capacity. We are booking big charter series in all directions at the moment, some of this with commodities, for example, raw materials, which are not traditional charter commodities,” Air Partner’s Singapore-based director for freight and VP for Asia Pacific, Mike Hill, told Lloyd’s Loading List in an interview.
Source: Lloyd´s Loading List