BDP Trendwatch: Freight sector navigating ‘uncharted waters’, Container contract system broken – BCOs shy away from short-term deals, Port of Montreal re-opens after legislation forces striking dockers back to work

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Freight sector navigating ‘uncharted waters’

Some air freight charter rates have rebounded to well above US$1 million per flight in recent days as the freight transport sector navigates through “uncharted waters” – unprecedented capacity and congestion issues affecting both air cargo and ocean shipping, according to a leading air charter broker.

Air Partner’s Singapore-based senior vice president for Asia Pacific, Mike Hill, told Lloyd’s Loading List in an interview that there has been little easing in market conditions since the start of the year, characterised by a critical lack of ocean containers and capacity for ex-China exports, together with vessel schedule disruption and congestion at some major ports around the globe – exacerbated by the aftermath of the recent Suez Canal blockage.

Source: Llyod´s Loading List

 

Container contract system broken – BCOs shy away from short-term deals

BCOs will commit 25% less volume to long-term contracts this year, sending almost twice as much via short-term and spot deals.

“This strategy will leave carriers with fewer contracted, forecasted containers and BCOs spending more time and resources renewing and negotiating contracts this year, even as prices for those may increase anyway,” says a report by Freightos Research published today.

Source: The Loadstar

 

Port of Montreal re-opens after legislation forces striking dockers back to work

Operations began gradually returning to normal Saturday at the Port of Montreal after the Canadian federal government rushed through legislation late Friday forcing some 1,150 striking dockers back to work. Non-compliance by either dockers or port employers carried fines of up to C$100,000 a day. The bill also provides for the appointment of a mediator-arbitrator who will have the power to impose a binding new collective agreement within 90 days.

Such government intervention was sought by increasingly anxious business circles across the country and the Ontario and Quebec provincial governments along with Canada’s 2nd largest port serving shippers in a large hinterland that includes the U.S. Midwest.

Source: AJOT

 

Freight rate 'contagion' will bring a two-year 'profit bonanza' for ocean carriers

Shippers are bracing for a further broadside of rate increases in June across multiple trades, as ocean carriers beef up profits ahead of the peak season.

After a period of stability, following hikes of up to 200% in the second half of last year, transpacific carriers are rolling out a raft of new GRIs, effective 1 June.

Source: The Loadstar

 

No relief: Global container shortage likely to last until 2022

The world does not have enough containers in the right places to handle cargo demand. It’s a conundrum that has persisted for so long that the mainstream press is finally covering it. 

The New York Times reported Friday how the box shortfall is contributing to inflation: “Demand … has outstripped the availability of containers,” while the U.S. pandemic situation has eased to the point where retailers can pass along higher transport costs to consumers without being accused of price gouging — and “the cost of just about everything is rising.”

Source: FreightWaves

 

Covid immigration controls heap pressure on Singapore’s shipyards

Immigration restrictions thanks to Covid-19 are heaping pressure on Singapore’s shipyards.

In a trading update yesterday, Sembcorp Marine, one of the republic’s largest shipyard groups, discussed supply chain constraints and a shortage of skilled workers affecting daily operations.

“Foreign workers who left Singapore over the past year could not return due to ongoing border controls in countries such as India and Bangladesh,” Sembcorp Marine stated.

Source: Splash 24/7

 

MSC poised to overtake Maersk as world’s largest container carrier

Taking into account new orders and strong involvement in second-hand vessels, MSC is on track to soon overtake Maersk as the world’s biggest container line, according to maritime analyst Alphaliner.

“Irrespective of past developments and fleet growth, the carriers’ opposing stance on container vessel newbuilding is expected to see MSC overtake its Danish competitor and claim the global top spot some time in 2022,” Alphaliner said.

Source: Maritime Magazine

 

Positive Q1 for optimistic North American railroads as intermodal traffic grows

North American railroads recorded a mostly positive first quarter in intermodal, with CN, CSX and Union Pacific all growing – but at Canadian Pacific, the picture was more muted.

Chief executive of CN JJ Reust, announcing the 14% growth of intermodal revenue, claimed the company was destined to become the “premier railway of the 21st century”.

Source: The Loadstar

 

Protect Australian trade from 'foreign carriers and their overseas masters'

Australia’s freight associations have called for a ‘FMC-style’ federal regulator to oversee foreign-owned shipping lines and their “overseas masters”.

The Freight & Trade Alliance (F&TA) and Australian Peak Shippers Association say serious disruption to international supply chains is jeopardising access to markets for importers and exporters.

Source: The Loadstar

 

Egyptian Judge Rejects Appeal for Release of Ever Given

An Egyptian court upheld a ruling preventing the giant container ship that blocked the Suez Canal from leaving the country, after authorities sought more than $900 million in compensation from the owners.

The decision was announced Tuesday by a court in the canal-side city of Ismailia, following a legal appeal. The 400-meter-long Ever Given is owned by Japan’s Shoei Kisen Kaisha Ltd. and was being chartered by Taiwan’s Evergreen Line when it got stuck in the southern end of the canal for six days in March.

Source: gCaptain, Bloomberg