Freight & Logistics Update - 1 November 2023

Freight & Logistics Update – 1 November 2023

Good Afternoon, Clients, and Partners,

Below is the latest Freight & Logistics Update for this week. If you have any questions or queries please don’t hesitate to get in touch.

SOUTH AFRICA

South African ports continue to experience increasing congestion and delays. The port congestion is also negatively impacting the shipping lines ability to maintain schedule integrity, which then has the knock on effects of:

Schedule interruptions & blank sailings
Reduction in capacity (Due to schedule interruptions and blank sailings mentioned above)
Increase in freight rates and or surcharges relating to reduced capacity.

Onto the ZA port updates:

DURBAN

Port berthing delays continue to be experienced due to high levels of congestion. Key causes of the continued congestion include Strong winds, Crane & equipment breakdowns & Equipment maintenance down time.

Pier 1 : 10 days
Pier 2 : 14-16 days
Durban Point : 12 days

Important notes:

The total delays experienced by some vessels may be as much as 21 days.
Strong winds have been forecast for Friday 3^rd November & Monday 6^th November – this will likely hit port productivity also.

CAPE TOWN

Port berthing delays continue to be experienced. The port has reported strong winds during the week.

CTCT : 10-14 days – Will start a dredging campaign until the end of November reducing the terminal to 2-berth operations.
MPT : 4 days

Important note: Strong winds have been forecast for Friday 3^rd November which may impact port operations.

PORT ELIZABETH

Port berthing delays continue to be experienced and has increased from week 42. The port has reported strong winds during the week.

PECT : 4 days
NCT : 8 days

Important note: Intermittent strong winds have been forecast for the remainder of the week and will likely impact operations.

AFRICA & INDIAN OCEAN ISLANDS

Port congestion in West African ports continues to be experienced leading to increased delays and affecting overall transit times.

MAURITIUS

Berthing delays of 5 days experienced at Port Louis.

ANGOLA

Berthing delays of 3 days experienced at Luanda port.

GHANA

Berthing delay of 1 day experienced at Tema port.

NIGERIA

Berthing delays of 2 days experienced at Apapa port.

TANZANIA

No berthing delays experienced at Dar es Salaam port.

KENYA

Berthing delay of 1 day experienced at Mombasa port.

MOZAMBIQUE

Berthing delay of 1 day experienced at Maputo port.0

NAMIBIA

Berthing delays of 7 days experienced at Walvis Bay port.

NORTH AMERICA

USA

Terminals Updates:

New York/New Jersey – Vessel waiting time is up to 1 day.
Norfolk – Vessel waiting time is up to 2 days.
Savannah – Vessel waiting time is up to 5 days. Two new cranes are currently being commissioned on berth 2, while four of the oldest cranes on the same berth are being demolished. As a result, berth 2’s capacity to handle vessels will be limited for several months.
Charleston – Vessel waiting time is up to 2 days.
Miami/Port Everglades – Vessel waiting time is up to 3 days.
Houston – Vessel waiting time is up to 1 day. Due to vessel bunching the yard is facing congestion impacting the discharge productivity and extending port stays
Los Angeles/ Long Beach – Vessel waiting time is up to 4 days.
Seattle – Vessel waiting time is up to 4 days. Terminal 18 will be closed Fridays through October 2023 and on November 3, 2023
Oakland – Vessel waiting time is up to 3 days.

Rail Updates:

BNSF – Rail ramp is currently experiencing congestion in Chicago, Columbus, and Los Angeles. There are delays in picking-up and delivering containers at these locations.
UP/LAX/LGB – Rail ramp is currently experiencing congestion in Los Angeles. There are delays in picking-up and delivering containers at this location.

Equipment Availability:

Due to persistent congestion nationwide, chassis shortages continue to be observed resulting in potential delays for pick-up and delivery.

CANADA

Vancouver

Berthing delays of 7 days experienced at this port.

Montreal

Berthing delays of 3 days experienced at this port. Bad weather has begun on the North Atlantic Sea and this is impacting vessel schedules. Ships are currently arriving in Montreal with minimal delays, but this is expected to change as fall and winter intensify.

LATIN AMERICA

BRAZIL

Berthing delays of 2 days experienced at Santos port.

PANAMA

Important update regarding the status of national strikes and protest in Panama. Demonstrations and protests are taking place in different areas of the country. This is causing road blockages and closures in key points that are disrupting the pickup or delivery of shipments. Please expect delays during this time.

NORTH WEST CONTINENT, UNITED KINGDOM, MEDITERRANEAN

Vessel schedule delays continue to impact the region. Amended port rotations and port omissions on the carrier services, as well as vessel changes, cascading / rolled schedules and blank sailings may result in amended LCL cargo loading schedules.

BELGIUM

Berthing delay of 1 day experienced at Antwerp port. Civil works at PSA 869 resulting in ~400 meters reduction of berth started and is allowing one large vessel alongside at times but focus of cranes on one vessel is boosting productivity. No negative impact to operations. 913 with ongoing bollard works, completion delayed to December.
AGW Terminal received 3 additional gantries which are fully operational.

GERMANY

Berthing delay of 1 day experienced at both Hamburg and Bremerhaven ports.
Container Terminal Burchardkai (CTB): Berth 1+2 still closed for operations due to construction site for AGV operations, berth only usable as layby. Construction will continue until December.

UNITED KINGDOM

Berthing delay of 1 day experienced at London Gateway port. Terminal worked quickly through the delays from last weekend’s Pilot Station outage. All vessels resumed berth on arrival quickly.

SPAIN

Berthing delay of 1 day experienced at Barcelona port.

ITALY

Berthing delays of 3 days experienced at La Spezia port and 2 days at Genova port.

NETHERLANDS

No berthing delays experienced at Rotterdam port.
ECT and RGW terminals had to stop operations for a few hours beginning of the week due to dense fog.

FRANCE

Berthing delays of 2 days experienced at both Le Havre and Fos-sur-Mer ports.

TURKEY

No berthing delays experienced at Istanbul port.

INDIAN SUB-CONTINENT & MIDDLE EAST

INDIA

Berthing delay of 1 day experienced at Nhava Sheva, Mundra and Chennai ports.

ISRAEL

Eldan Cargo have provided an update related to the situation in Israel on 27th October 2023. All ports are running and operating. Their offices, warehouses, and all relevant services such as trucking are operating. ZIM will keep operating their vessels to Israel. If Ashdod will be closed, vessels will be diverted to Haifa port. Other shipping lines are now calling only Haifa.

SRI LANKA

Berthing delay of 1 day experienced at Colombo port.

UNITED ARAB EMIRATES

Berthing delay of 1 day experienced at Jebel Ali port.

ASIA PACIFIC (Including Oceania)

Hazardous commodity acceptance out of China remains a challenge as approval for loading remains subject to carriers’ stringent acceptance protocols. Capacity constraints are currently being experienced with carriers out of Asia. We have also seen an increased number of carriers changing routings and introducing additional ports calls and transhipments on their vessel schedules.

HONG KONG

Berthing delays of 1 day experienced at this port.

TAIWAN

Berthing delay of 1 day experienced at Kaohsiung port.

NANSHA

Berthing delay of 1 day experienced at this port.

SHANGHAI / NINGBO

Berthing delay of 1 day experienced at Shanghai and Ningbo ports.

QINGDAO

Berthing delay of 1 day experienced at this port.

XIAMEN

Berthing delay of 1 day experienced at this port.

SHEKOU / YANTIAN

Berthing delay of 1 day experienced at Shekou port and 2 days at Yantian port.

XINGANG

No berthing delays experienced at this port.

KOREA

Berthing delay of 1 day experienced at Busan port.

VIETNAM

Berthing delay of 1 day experienced at Ho Chi Minh and Hai Phong ports.

MALAYSIA

Berthing delay of 1 day experienced at Port Kelang.

THAILAND

Berthing delay of 1 day experienced at Bangkok port.

SINGAPORE

Berthing delay of 1 day being experienced.
No delays experienced for transshipment cargo, only vessel scheduling delays experienced. Delays are expected FCL containers transshipping in Singapore. Expected delays are between 2-3 weeks.

NEWS ARTICLES

Port of Durban in a state of mismanaged chaos

Date: 26th October 2023

The Port of Durban is facing massive backlogs on the land and waterside with more than a dozen vessels queuing outside the port at any given time, and trucks battling to get appointments as equipment failures and inclement weather hampers operations.

However, Transnet’s Durban Terminals managing executive Earle Peters has assured port users that the crisis is receiving management’s attention at the highest level through President Cyril Ramaphosa.

Freight industry stakeholders, who asked to remain anonymous, said berthing delays have run into weeks, while trucks have been struggling to get appointments to load and offload cargo. They said the port’s management had called an urgent meeting with major shipping lines on Thursday last week and another on Monday night to deal with the crisis that has been ongoing for the past six weeks.

“Berthing delays are running into two weeks,” one port user said. “Last Thursday there were 14 ships sitting outside. It has not got this bad before. The equipment is breaking down in the stacks and we don’t have equipment to service the trucks so they can’t get appointments.” “There isn’t enough equipment even though they are cannibalising parts from one machine to another. This is resulting in truck congestion, delays inside the terminal up to 10 hours, no booking slots are released as well as vessel berthing delays.” The source said there’s a real fear that the terminal will soon come to a grinding halt. [1]

Transnet warns of strike action

Date: 27th October 2023

Transnet has warned of plans by the SA Transport Workers’ Union to down tools on November 3.

In a statement released to stakeholders, the transport utility has said that it regards the planned action as unprotected because the union has not complied with compulsory prerequisites for a lawful protest, which include a structured process conducted by Nedlac.

Satawu has warned that should the strike go ahead, the ‘no-work-no-pay’ principle will apply and disciplinary action against participating employees may be taken. [2]

DP World takes control of Port of Dar es Salaam

Date: 23rd October 2023

Emirati logistics multinational DP World has officially announced what had already been finalised on paper but had been held back by dissenters resisting privatisation of Tanzania’s biggest port – a 30- year concession agreement worth at least $250 million in the agreement’s infancy.

The deal heralds a jewel in the UAE ports company’s logistics crown, especially from an East African perspective. Although it may seem like a far-fetched comparison to make, overstating the Port of Dar es Salaam’s appeal, there can be no mistake that a certain kind of sparkle will be added to a port that has been hobbled by congestion and corruption for longer than anyone cares to remember.

The deal, which could grow to $1 billion in investment over the concession’s lifespan and could include infrastructural hinterland upgrades, was previously mired in controversy that even saw the involvement of Human Rights Watch.

A company statement, released following an official signing ceremony yesterday, said: “The concession to operate and modernise the Dar es Salaam Port was awarded to DP World with the primary objective of optimising the port’s operations to improve transport and logistics services throughout Tanzania and its hinterland. [3]

Port of Rotterdam throughput figures down for 2023

Date: 24th October 2023

General cargo throughput at the Netherlands’ Port of Rotterdam – one of the world’s busiest ports – dropped 13.7% in the first nine months of 2023 compared to the equivalent period in 2022.

Boudewijn Siemons, interim chief executive officer and chief operations officer of the Port of Rotterdam Authority, said the results were due to reduced consumer spending, large stocks and lower investments. However, decreased volume figures had been expected, he said. “Most of the throughput in the first nine months was lower than last year but is in line with our Prognoses. The economy has not yet recovered and continues to impact throughput figures. In spite of less throughput, we are committed to investing in a vital and climate-neutral port going forward.”

General cargo throughput stood at five million tons during the period under review. This compares to 5.8 million tons in the first nine months of 2022. In addition, roll-on/roll-off traffic reached 19.8 million metric tons, 3.8% down on the volumes reported in the January-September period last year. [4]

MSC edges closer to control of Hamburg’s container terminals

Date: 24th October 2023

Swiss-owned container line Mediterranean Shipping Company is forging ahead with its 49.9% ownership deal of the Port of Hamburg after publishing a share-buy offer of 16.75 euros per share.

MSC’s ambitions to increase the struggling port’s box capacity by up to one million TEU’s has received the green light from Germany’s Federal Financial Supervisory Authority, (BaFin). It now seems a mere formality for shareholders to approve MSC’s ‘take over’ bid of Hamburger Hafen und Logistik (HHLA), the logistics entity responsible for container operations at the port.

News of MSC moving into a controlling position of Hamburg bodes well for a port that has recently slipped from a commanding position down Europe’s capacity rankings. In the first half of 2023, Hamburg’s container throughput fell 11.7% to 3.5 million TEU after last year’s

figures of 8.3 million TEU per annum. [5]

More delays at Australian ports as more strikes are announced

Date: 27th October 2023

Labour strife is set to persist in Australia’s ports. The Maritime Union of Australia (MUA) notified terminal operator DP World it would continue a series of protected industrial actions at its four facilities through to the end of the third week of November.

At the heart of the dispute is a proposal from DP World Australia’s management for a flexible roster system, which it claimed would be “better suited to the needs of its customers”. The MUA contends that the new roster would mean a dramatic increase in the number of weekend hours its members would work and effectively represent a 32% pay cut. [6]

MSC and Maersk ‘decouple’ their fleets, ready to go their separate ways

Date: 25th October 2023

Ahead of the demise of the 2M Alliance at the end of next year, MSC and Maersk have already ‘decoupled’ their fleets, deploying their vessels on individual service loops.

This has fuelled speculation that the carriers will agree to end their east-west vessel-sharing alliance early. Alphaliner said: “Services previously operated with a mix of MSC and Maersk ships have gradually been altered to leave one ship operator per loop.”

On the Asia-North Europe tradelane, for example, eeSea data confirms that Maersk as the sole vessel provider for the AE5/Albatross, AE10/Silk and AE7/Condor loops, with MSC as the vessel operator on the AE55/Griffin and AE6/Lion strings, along with its standalone Swan service.

MSC, with a current fleet of 5.5m teu and a huge orderbook of some 1.5m teu, has already taken delivery of two newbuild 24,000 teu ultra-large vessels this month and would be able to operate independently at short notice, if required.

Meanwhile, Maersk’s methanol-powered newbuilds will start to arrive next year, and Alphaliner suggests the carrier, with its ‘green loops’ USP, will be unlikely to want to vessel-share them, and it will be able to underpin its standalone east-west network. [7]

Gloomy outlook for container shipping – and not just for 2024

Date: 24th October 2023

“The outlook for the global container shipping trades continues to darken, according to Drewry’s latest container forecaster, which is predicting an industry-wide $15bn loss for next year.

Drewry’s senior manager container research, Simon Heaney, today presented a “pessimistic” outlook for the liner industry, predicting a 60% reduction this year in global freight rates – spot and contract combined – followed by a drop of 33% in 2024. And he added: “It is not just a challenge for 2024, but will be repeated in corresponding years.”

Carriers will face “a relentless challenge to keep rates above cost”, said Mr Heaney. “The more extreme the cash drain, the more extreme the carrier response will be, so we expect an impact there.”

The low freight rates reflect the extreme disconnect between supply and demand – Drewry’s global supply:demand index is set to reach an all-time low, with a predicted 6.4% growth in supply versus a 2% growth in demand next year.

It concluded that the unnatural 2020-2021 demand surge caused a subsequent pinch on consumer spending, leaving a deep void in the container market that will last a long time, even while the global economy pushes forward, revealing once more how the relationship between GDP and container volumes has vanished.” [8]

SOURCES AND REFERENCES

SACO CFR

[1] https://www.freightnews.co.za/article/port-durban-state-mismanaged-chaos

[2] https://www.freightnews.co.za/article/transnet-warns-strike-action

[3] https://www.freightnews.co.za/article/dp-world-takes-control-port-dar-es-salaam

[4] https://www.freightnews.co.za/article/port-rotterdam-throughput-figures-down-2023

[5] https://www.freightnews.co.za/article/msc-edges-closer-control-hamburgs-container-terminals

[6] https://theloadstar.com/more-delays-at-australian-ports-as-more-strikes-are-announced/

[7] https://theloadstar.com/msc-and-maersk-decouple-their-fleets-ready-to-go-their-separate-ways/

[8] https://theloadstar.com/gloomy-outlook-for-container-shipping-and-not-just-for-2024/

Best Regards

Inter-Sped Team