Freight & Logistics Update - 18th October 2023

Freight & Logistics Update – 18th October 2023

Good Morning 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

Durban

Durban, Pier 2 is currently experiencing +/- 9 to 11 days waiting time. Terminal is currently experiencing equipment challenges and crane outages. A weather warning sent for very strong winds and rain from Friday to Saturday 13/14 October 2023. The adverse weather conditions will result in terminal stoppages over this period.

Pier 1 : 7 days

Pier 1 on standby since yesterday afternoon (16 Oct, 15:20) after wind gusts measured 75mph. [attachment 1]

Pier 2 : 12 days

Pier 2 also on standby since yesterday afternoon (16 Oct, 17:10) after wind gusts measured 75mph. [attachment 2]

Durban Point : upto 10 days

Cape Town

Port berthing delays continues to be experienced. The port has reported strong winds during the week. High volumes of cargo and traffic experienced at Cape Town terminals

CTCT : 7-14 days
MPT : 2 days

Port Elizabeth

Port berthing delays are still being experienced. The port has reported windy weather during the week.

PECT : 2 days

NCT : 7 days

AFRICA & INDIAN OCEAN ISLANDS

MAURITIUS

Berthing delays of 2 days experienced at Port Louis.

ANGOLA

Berthing delays of 4 days experienced at Luanda port. Congestion experienced at the port.

GHANA

Berthing delay of 1 day experienced at Tema port.

NIGERIA

Berthing delays of 2 days experienced at Apapa port.

TANZANIA

Berthing delays of 9 days experienced at Dar es Salaam port due to congestion. Slightly reduced draft at berths 8-11 (10m)

KENYA

No berthing delays experienced at Mombasa port.

MOZAMBIQUE

Berthing delays of 4 days experienced at Maputo port.
Pre-Inspection Certificates are mandatory for specified products being imported into Mozambique.

NAMIBIA

Berthing delays of 2 days experienced at Walvis Bay port.

NORTH AMERICA

USA

Terminals Updates:

New York/New Jersey – Vessel waiting time is up to 1 day. The scheduled maintenance for Crane 6, originally set to start on October 1, 2023, has been postponed indefinitely to reduce congestion.
Norfolk – Vessel waiting time is up to 1 day.
Savannah – Vessel waiting time is up to 4 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 down to 1 day.
Miami/Port Everglades – Vessel waiting time is up to 2 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 3 days.
Oakland – Vessel waiting time is at 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 3 days experienced at this port. All marine terminals in Vancouver are currently operational. However, there is an issue with berth congestion as the terminal continues to recover from the previous strike action.

Montreal

Berthing delay of 1 day being experienced at this port.

LATIN AMERICA

BRAZIL

No berthing delays experienced at Santos port.

NORTH WEST CONTINENT, UNITED KINGDOM, MEDITERRANEAN

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.

GERMANY

Berthing delay of 1 day experienced at Bremerhaven port and 2 days at Hamburg port.
Container Terminal Burchardkai (CTB) started extensive berth renovations on berth 1+2. Construction will last for at least 10 weeks. Berth 1+2 will be closed for operations during the construction but can be utilized as a layby pier.

UNITED KINGDOM

Berthing delay of 1 day experienced at London Gateway port. Due to the ongoing expansion construction LGP with 20m less pier length minimal impact to operations.

SPAIN

Berthing delay of 1 day experienced at Barcelona port.

ITALY

Berthing delays of 2 days experienced at La Spezia port and 1 day at Genova port.

NETHERLANDS

Berthing delay of 1 day experienced at Rotterdam port.

FRANCE

Berthing delays of 2 days experienced at Le Havre port and 1 day experienced at Fos-sur-Mer port.

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

Our partners have confirmed that they currently remain operational amidst the on-going conflict. Some delays are expected in communication and movement of cargo.

SRI LANKA

No berthing delays experienced at Colombo port.

UNITED ARAB EMIRATES

Berthing delay of 1 day experienced at Jebel Ali port.

ASIA PACIFIC

As the Far East moves into typhoon season, most of the main ports are expected to be affected by severe weather conditions.

There are weekly blank sailings, currently week 42 and 43 will be badly affected by it. This will also affect LCL cargo.

LCL Hazardous commodity acceptance out of China remains a challenge as approval for loading remains subject to carriers’ stringent acceptance protocol. [attachment 3]

As mentioned in last month’s update, typhoons hitting the Asian continent in August have caused a ripple effect on service delays for sailings from Asia into Europe, mostly on the AE6 service. While delays coming into Europe could not be avoided, our teams have worked on a recovery plan for sailings out of Europe and expect no delay on the voyage back to Asia. [1]

Carrier scheduling out of China has been erratic following the Golden Week holiday period with an increased number of blank sailings being seen until the end of October.

HONG KONG

Berthing delays of 2 days experienced at this port.

TAIWAN

Berthing delays of 2 days experienced at Kaohsiung port.

NANSHA

No berthing delays experienced at this port.

SHANGHAI / NINGBO

Berthing delay of 1 day experienced at Shanghai port and 2 days at Ningbo port. Shanghai dredging activities from Mid Sept – Mid Oct, estimated 400m of wharves length will be closed during dredging.

QINGDAO

Berthing delay of 1 day experienced at this port.

XIAMEN

Berthing delays of 4 days experienced at this port.

SHEKOU / YANTIAN

Berthing delays of 2 days experienced at Shekou port and 3 days experienced 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 port and 2 days at Hai Phong Port.

MALAYSIA

Berthing delay of 1 day experienced at Port Kelang.

THAILAND

Berthing delays of 2 days experienced at Bangkok port.

SINGAPORE

Singapore 3-4 weeks delays due to blank sailings.

NEWS ARTICLES

Transnet employees lack tools of trade

Date: 4th September 2023 (Week 36)

The declining availability of straddle carriers at Transnet’s Durban Container Terminal (DCT) Pier 2 is proving to be a challenge for the parastatal.

The entity’s DCT manager, Lulamile Mtetweni, on Monday said operations continued at the DCT Pier 2 despite the declining availability of straddle carriers over the past three weeks. Mtetweni said the current challenges were due mainly to the unavailability of critical spares.

As an interim measure, while awaiting the new fleet, TPT is exploring leasing from original equipment manufacturers (OEMs), even if the equipment is second-hand.

With the open tender due to close in September 2023, the awarding is planned for October 2023, and DCT Pier 2 is one of the beneficiaries. Bidders are expected to submit proposals stipulating among others, demand and supply timelines on spares for the existing fleet across all the company’s 16 sea-cargo terminals”. [2]

Africa emerges as container bright spot

Date: 9th October 2023

A bright spot for container shipping in a challenging year has been Africa, something experts believe will be spurred on in the coming years by the creation of the African Continental Free Trade Area (AfCFTA), the world’s largest free trade area.

Containerised imports into Africa in the first seven months of this year grew by 10.1% in comparison to the same period in 2019 and by 6.7% compared to the historically high 2022, according to Maersk Broker.

The main driver of this increase has been the trade from Asia into the African west coast. The trade volume on this tradelande has grown by 20.9% compared to last year. Volumes from the Middle East and South America into West Africa have also contributed to the increase. Such growth trends are also visible in the deployment on the Asia – West Africa trade, where the deployed tonnage in October this year has grown by 22.3% in teu terms compared to the same period of 2022, according to data from Maersk Broker.

According to data from Container Trade Statistics, the Asia-Africa market is the strongest growing exAsia market in 2023, having seen August 2023 year-to-date, year-on-year volume growth of 19.6%, far better than the global contraction of -3.3%.

However, the Asia-Africa trade only accounts for 3.2% of the global deepsea volumes in 2023 year-todate, compared to the 17.9% market share of Asia-North America or 14.7% of Asia-Europe. “Since most parts of Africa are experiencing rapid urbanisation, we expect the demand for building materials, electronics, furniture and other containerised goods to continue increasing,” stated the latest weekly container report from Maersk Broker.

Of all the trade lanes tracked by UK consultancy Maritime Strategies International (MSI) it is the Asia to Africa route that has experienced the strongest growth this year. [3]

SA and Namibia to strengthen trade ties

Date: 12th October 2023

Namibia and South Africa’s business executives explore opportunities to increase trade and investment flows between the two countries at the Namibia-South African Business Forum and Exhibition on Friday.

The Business Forum and Exhibition, which will be held at the Windhoek Country Club, will focus on strategic priority sectors agreed to by both countries, namely, agriculture and agro-processing, automotive, clothing and textile, and green hydrogen, including exploring opportunities to strengthen cross-border value chains and the integration of infrastructure and logistics supply chains.[4]

EU ports roll out new bunker metering system

Date: 12th October 2023

Port authorities at Rotterdam and Antwerp-Bruges are clamping down on bunkering market cheating and the shorting of deliveries in operations.

Both ports have announced that they plan to go ahead with new rules to deal with these issues by making make mass flow meters mandatory by 2026.

This comes after the two port authorities reported at the end of 2022 that they were working on addressing these long-standing challenges to come in line with other ports around the world that have already introduced technology to prevent cheating and shorting. They said independent research had revealed that there are currently quality challenges in the bunkering markets at Rotterdam, Antwerp, and Zeebrugge.

According to the new rules operators in the ports will have to produce certified bunker measurement systems on board fuel barges and bunker vessels. The system will reflect the exact volumes of fuel that is being delivered to each seagoing vessel bunkering in the ports, in order to improve transparency, efficiency, and reliability. [5]

Industrial action brews across UK ports

Date: 10th October 2023

Trade union Unite has warned the Associated British Ports (ABP) that strike action could be looming across its 21 ports which handle around a quarter of the United Kingdom’s seaborne trade.

Unite has lodged a dispute concerning new health checks for maritime pilots who safely navigate ships in and out of the UK’s waterways and ports.

This comes after ABP introduced increased medical standards for marine pilots last July without any consultation with workers, which is required under health and safety legislation and the union’s recognition agreement.

Unite said in a statement that it has no objection to improving standards, but there had been no negotiations and no detail about how the medical tests will be done or what happens if a member fails, raising serious concern as workers’ jobs could be at stake.

Unite general secretary, Sharon Graham said: “Maritime pilots are scarce, skilled and highly experienced. “Ships can’t leave or enter the UK’s ports without them. So it’s all the more incredible that ABP Ports is refusing to negotiate important changes to their health and safety. [6]

Container Shipping’s Loss of EU Antitrust Exemption ‘May Backfire on Shippers’

Date: 11th October 2023

The European Commission’s decision not to renew the Consortia Block Exemption Regulation (CBER) after more than a decade covering box shipping in Europe has reopened the debate over what benefits shippers accrue from vessel sharing agreements.

Announced yesterday, the decision will take effect when the shipping alliance exemption expires on 25 April next year and, while shippers said it was “welcome news”, analysts have remained circumspect. [7]

Israel Ports Open But At ‘Heightened Risk’

Date: 10th October 2023

Activity at Israel’s ports is slowing after Saturday’s attacks by Islamist group Hamas on towns close to Gaza, with the cost of insurance premiums for Israeli shipments soaring amid tightening supplies of food stocks.

Israel’s southern coastal city of Ashkelon, which has a small port well in range of Hamas rockets, is not allowing ships to enter, shipping sources said.

While the main Israeli ports of Ashdod further up the coast and Haifa in the north, remain

open, shipping and maritime security companies are reviewing their operations for Israel, industry sources said. “Israeli ports are deemed to be at heightened risk,” said Noah Trowbridge, with British maritime risk advisory and security company Dryad Global.

“With continuous rocket barrages expected from Gaza, alongside the potential for a protracted conflict, the damage to port infrastructure becomes increasingly probable.”

Ashdod port said workers continued to work regularly despite the emergency situation. “The port’s berths are open as much as needed and we are offering a response to meet all Israel’s needs,” Ashdod port said in a statement.

German container shipping company Hapag Lloyd told Reuters that Ashdod port had imposed restrictions on the loading or discharging of dangerous cargo, which includes flammable, explosive or toxic substances, adding that the company was monitoring its shipping services to Israel.

Shipbroker BRS said security had been stepped up at Israeli ports, adding that the principal threat to shipping coming into Israel was from rockets fired from Gaza and from “hostile forces” on the ground in Israel after Hamas fighters infiltrated the country.

“Since Gaza has a coastline, direct threats to shipping inside Israeli waters cannot be ruled out,” BRS said.

EMPTY SHELVES

Nearly all of Israel’s trade is via the sea. It is a food producer, but relies on imports for the majority of its grain needs, as well as quantities of fish, beef, nuts and consumer food products.

Residents across Israel reported many neighborhood supermarkets had bare shelves and low inventories of food staples as consumers stocked up in anticipation of a prolonged war. The Israeli army’s homefront command reposted on Monday its standing guidance for being prepared in times of emergency, which includes families collecting water and food for up to three days, as well as medicine and flashlights. [8]

Carriers and forwarders to lose mark-up on THC collection in Dubai

Date: 11th October 2023

Container lines serving Middle East trades are facing the prospect of losing a major source of their income from mark-ups or margins on ancillary collections.

According to a decree by the Dubai Maritime Authority (DMA), which governs ports, customs and freezones in the UAE, carriers or freight intermediaries like NVOCCs and freight forwarders have been barred from collecting terminal handling charges (THCs) on behalf of customers for payment to terminal operators. [9]

MSC takes delivery of another Chinese-built behemoth

Date: 11th October 2023

Mediterranean Shipping Company (MSC) took delivery of one of the world’s largest container ships, capable of carrying 24 000 TEUs.

Built by China Shipbuilding Trading Corporation on Monday, the handover took place in Shanghai, one month ahead of schedule.

Designed by Hudong-Zhonghua Shipbuilding Group (HZS) and built by Jiangnan Shipyard and CSTC, MSC China is the 13th and latest 24 000 TEU ultra-large container ship from China State Shipbuilding Corporation (CSSC). [10]

FBX Index October 2023: The market at a crossroads

Date: 10th October 2023

The end of September traditionally marks the end of the peak season as China moves into their week-long Golden Week holiday. It is by now very clear that the peak season was a dud from the container lines’ perspective.

The Asia-to-Europe trade was essentially in freefall in terms of the spot market throughout the month and ended up at levels below what was seen pre-pandemic. The equally important Transpacific trade was also under pressure, although in this case, it would be more correct to state that the rate levels kept seeping to the US West Coast whereas the US East Coast saw a stronger declining trend.

The Atlantic trade, which suffered a complete collapse earlier in the summer, essentially languished at the extremely low level it had bottomed out at. However, even though looking straight at the spot rate developments paints a bleak picture for the carriers, the reality is worse.

The Asia-North Europe trade is affected the worst and is in essence at the same level as seen in the peak season of 2019 before the pandemic. This is problematic as general cost

inflation has risen significantly in recent years and furthermore the carriers have had to implement the IMO2020 rules, which means shifting to the much more expensive low-sulphur fuel.

Pacific rates are still somewhat higher than pre-pandemic but they cannot be said to be strong. However, the situation is much worse in the Atlantic trade from Europe to the US, which is said to have collapsed. Demand in this trade was growing at a healthy clip during the pandemic. Measuring year-on-year demand growth is difficult owing to the large initial pandemic swings.

If instead demand on the Europe to North America trade is measured as an annualised average growth versus 2019, then November 2020 saw a growth of more than 10%. During 2021 and into the spring of 2022, the trade showed an average annual growth rate versus 2019 of around 5%, which is a high growth rate for such a mature trade.

This is where the market is at a crossroads. It is clear the demand does not support the carriers’ deployment of capacity in their current networks. It is also clear that the continuing delivery of more new vessels will only make this worse. Unless the carriers change behaviour, we could be facing a much more severe downturn in rates in the coming months.

However, the carriers could also choose to remove capacity and this is what is currently happening. The number of sailings being blanked in the wake of Golden Week is higher than usual. New vessels are left idle at times out from the yards rather than being put into service immediately. Schedule reliability is slowly worsening again.

The key to watch is whether the aggressive blank sailings program results in a halt to rate declines during September and potentially begins to reverse the trend despite coming out of the peak season. [11]

SOURCES & REFERENCES

SACO CFR

[1] https://www.maersk.com/news/articles/2023/10/11/europe-market-update-october-23

[2] https://www.citizen.co.za/witness/news/transnet-employees-lack-tools-of-trade/

[3] https://splash247.com/africa-emerges-as-container-bright-spot/

[4] https://www.freightnews.co.za/article/sa-and-namibia-strengthen-trade-ties

[5] https://www.freightnews.co.za/article/eu-ports-roll-out-new-bunker-metering-system

[6] https://www.freightnews.co.za/article/industrial-action-brews-across-uk-ports

[7] https://gcaptain.com/container-shippings-loss-of-eu-antitrust-exemption-may-backfire-on-shippersanalyst-warns/

[8] https://gcaptain.com/israel-ports-open-but-at-heightened-risk/

[9] https://theloadstar.com/carriers-and-forwarders-to-lose-mark-up-on-thc-collection-in-dubai/

[10] https://www.freightnews.co.za/article/msc-takes-delivery-another-chinese-built-behemoth