BDP Trendwatch: No sympathy for carriers from shippers who must foot the bill for bunker hikes, LATAM announces the conversion of up to eight Boeing 767-300ERs into freighters, Higher contract rates ahead as shippers seek security

Port at Night with lights reflecting off water

No sympathy for carriers from shippers who must foot the bill for bunker hikes

Higher fuel costs are triggering increases in ocean carrier bunker surcharges, adding more misery for shippers already struggling with record high freight rates and additional fees.

Today’s price for low-sulphur fuel oil (LSFO) at Rotterdam is just under $500 per ton, which is up 25% since the beginning of the year and some 60% higher than in November.

And carriers are busy resetting their fuel increase recovery mechanisms, effective today or from 1 April, to reflect the higher bunker costs.

Source: The Loadstar

 

LATAM announces the conversion of up to eight Boeing 767-300ERs into freighters

The conversion plan will be implemented in two stages and could boost the cargo operators’ s joint capacity by up to 80%. The first phase features four confirmed aircraft to be received after conversion between 2021 and 2022. The second phase consists of four additional conversion options for delivery between 2022 and 2023.

The addition of these aircraft would consolidate LATAM Group as the leading group of cargo operators in South America. It will allow the cargo affiliates to reinforce their operations from North America and Europe into South America, as well as expand operations in the flower markets of Ecuador and Colombia.

Source: AJOT

 

Higher contract rates ahead as shippers seek security

Contract freight rates have risen sharply and could well remain high for the remainder of 2021 and beyond, as shippers that had successfully played the spot market in the past have been hit hard by the recent ocean supply constraints and now seek longer-term commitments.

“We see that the contracts that we have closed for 2021 are generally up compared with the previous year, fairly significantly,” said Hapag-Lloyd chief executive Rolf Habben Jansen. “But if you look at them by historical standards and go back a bit more than just the last few years then they are still at a reasonable level.”

Demand for contract cargo over spot cargo has increased following the log jams that had seen shippers increasingly struggle to find space on board ships for their containerised freight.

Source: Lloyd´s Loading List

 

The Panama Canal releases January CO2 emissions data

The Panama Canal released the January data from the CO2 Emissions Dashboard, which calculates the carbon dioxide (CO2) emissions saved by vessels that choose to transit the Panama Canal over the most likely alternative route.

The figures confirmed that customers already saved a million tons of CO2 emissions in the first month of 2021, equivalent to the emissions produced by roughly 215,000 passenger vehicles driven for a year. This translates to each transit saving an average of 1,206 tons of CO2 emissions, roughly the amount a car would produce driving the length of the circumference of Earth 100 times.

Source: AJOT

 

Rotterdam Expansion Will Increase Container Capacity by a Quarter

The Port of Rotterdam Authority awarded contracts for the expansion of its harbor facilities with the potential to increase by more than a quarter the annual container throughput as well as provide additional space for inland shipping and future expansion. The first sections of the new dock wall are expected to be completed in late 2022 as the port works to increase capacity to deal with the expected continuing growth in container volumes.

“Particularly because of e-commerce, container volumes are increasing sharply,” explains Boudewijn Siemons, chief operating officer of the Port of Rotterdam Authority. “That will continue for the time being. To further strengthen our leading position as Europe's largest container port, we are now responding to this development by investing in the further expansion of the Princess Amalia Harbour. This is an investment that will boost the competitive position of our customers and Rotterdam.”

Source: The Maritime Executive

 

Hong Kong shippers' fears ease as 100% air cargo screening looms

The final phase of Hong Kong’s air cargo security screening programme began today with x-raying of all ‘unknown’ consignee cargo set for 30 June.

However, while local shippers welcomed a delay in the rule set by the International Civil Aviation Organization (ICAO), citing increased lead times and costs, current market conditions mean its impact could be muted.

The delayed phase-in began in January last year with 25% screening, and Simon Wong, CEO of Hong Kong-based U-Freight said: “The final phase demands that all consignors of air cargo must be approved by the appropriate authority as a validated known Consignor (KC).

Source: The Loadstar

 

Euro-area factory costs rising at fastest pace in a decade

Euro-area manufacturers are reporting the steepest increases in their input costs in almost a decade as the coronavirus disrupts supplies, and are passing at least some of that burden onto customers.

Rising demand for goods is running into virus restrictions that are causing delivery delays and pushing up prices for raw materials and components, according to an IHS Markit survey.

Source: AJOT

 

More blank sailings 'a harbinger' of soaring rates on the transatlantic

Container spot rates on the transatlantic headhaul North Europe to North America east coast tradelane have recovered to pre-pandemic levels, but have so far not seen the hyper-inflation impacting other routes.

According to Friday’s Freightos Baltic Index (FBX) reading, the price for a 40ft container on the route stood at $2,026, which is on par with the rate in April last year and compares with a low of $1,622 in September.

But the lull could end soon, according to one leading analyst, as carriers focus on maximising returns from relatively underperforming parts of their networks.

Source: The Loadstar

 

UK fresh produce imports ‘face chaos’

Imports of fresh produce to the UK from the EU face serious disruption next month when new border controls are introduced, according to a senior executive at the International Transport Union (IRU), reflecting concerns expressed by others in the freight sector.

Matthias Maedge, director of Advocacy at the Geneva-based road haulage industry body, told the BBC’s Newsnight programme last week that there could be chaos when new changes to import procedures come into effect on 1 April 2021 as a result of the UK government failing to properly warn and advise EU hauliers and businesses about the new checks and paperwork which will be required to bring goods from the EU into the UK.

Source: Lloyd´s Loading List

 

IATA: Air cargo demand beats 2019 levels in January

Air cargo volumes returned to pre-Covid levels in January with demand even increasing compared with 2019 levels for the month.

The latest statistics from IATA show that air cargo volumes in cargo tonne km terms were in January up by 1.1% compared with 2019 levels and 6.1% year on year.

Meanwhile, capacity for the month was down by 19.5% compared with 2019 and 19.3% on last year.

As a result, cargo load factors stood at 58.9%, which is a 12 percentage point improvement on 2019 and 14.1% increase on last year.

Source: AirCargo News

 

Cargo remains the bright spot for Turkish Airlines in 2020

A strong rise in cargo revenues helped Turkish Airlines end 2020 with a profitable final quarter at an operating level, though the Star Alliance carrier still posted a net loss of $836m for the full-year.

While the carrier’s passenger revenues slumped by two-thirds for the three months ended December 2020, to $876m, Turkish Airlines increased its cargo revenues almost four-fifths to reach $841m.

This helped the carrier post an operating profit of $61m for the fourth quarter, though it slipped to a net loss of $50m for the same period.

Source: AirCargo News