Freight & Logistics Update - 26 October 2023

Freight & Logistics Update – 26 October 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

DURBAN

Port berthing delays continues to be experienced due to high levels of congestion. The port has reported strong winds during the week.

Pier 1 : 7 days
Pier 2 : up to 14 days
Durban Point : 10 days

Customer advisory from Transnet on 16th October 2023: with regards to free import storage days at Pier 2 in Durban.

“Dear Valued Customer

PIER 2: FURTHER FREE IMPORT STORAGE DAYS EXTENSION FROM 30 SEPTEMBER UNTIL 30 DECEMBER 2023

Whilst the terminal is making every effort to improve on the current status of equipment availability and reliability, a decision has been taken to further extend the free import storage to 4.25 days for vessels with a discharge volume of more than 2000 containers.

Customers are reminded that this interim dispensation excludes reefers and IMDG containers. Reefer will remain at 2 days free import storage as communicated at the start of the reefer season and IMDG’s will remain unchanged as published in the TPT Tariff book. Yours Sincerely, Mr Earle Peters, Managing Executive – Durban Terminals, Transnet Port Terminals”

CAPE TOWN

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

CTCT : 7-14 days – Will start a dredging campaign until the end of November reducing the terminal to 2-berth operations.
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 delay of 1 day experienced at Port Louis.

ANGOLA

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

GHANA

Berthing delays of 4 days experienced at Tema port.

NIGERIA

Berthing delay of 1 day 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

Berthing delay o 1 day experienced at Mombasa port.

MOZAMBIQUE

Berthing delay of 1 day experienced at Maputo port. Pre-Inspection Certificates are mandatory for specified products being imported into Mozambique.

NAMIBIA

Berthing delays of 6 days experienced at Walvis Bay port

NORTH AMERICA

USA

Terminals Updates:

New York/New Jersey – Vessel waiting time is up to 3 days. 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 2 days.
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 up to 3 days.
Miami/Port Everglades – Vessel waiting time is up to 1 day.
Houston – Vessel waiting time is up to 3 days. 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 2 days.
Oakland – Vessel waiting time is up to 2 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 2 days experienced at this port. All marine terminals in Vancouver are currently operational and berth congestions is no longer an issue.

Montreal

Berthing delays of 3 days being experienced at this port.

LATIN AMERICA

BRAZIL

Berthing delays of 4 days 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 delays of 2 days experienced at both Hamburg and Bremerhaven ports.
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 delays of 2 days 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 4 days at Genova port.

NETHERLANDS

Berthing delay of 1 day experienced at Rotterdam port.

FRANCE

Berthing delays of 3 days experienced at Le Havre port and no delays 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

Currently remain operational amidst the on-going conflict. Some delays are expected in communication and movement of cargo. We will continue to monitor the situation and will provide updates accordingly.

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.
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 1 day experienced at this port.

TAIWAN

Berthing delay of 1 day experienced at Kaohsiung port.

NANSHA

No berthing delays 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 and Yantian ports.

XINGANG

Berthing delay of 1 day 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 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 to be between 3-4 weeks for carriers transshipping in Singapore.

NEWS ARTICLES

Bill could extend Agoa inclusion by two decades

Date: 19 th October 2023

South Africa’s continued inclusion in the Africa Growth and Opportunity Act (Agoa) whereby exporters are granted preferential access to US markets and which is due for renewal in 2025 – or not – has a friend in senator John Kennedy.

The Republican Party legislator from the state of Louisiana has proposed a bill lobbying for Agoa’s extension by 20 years that, if approved by the US Congress, should safeguard till 2025 the benefits that African countries have under Agoa.

Part of Kennedy’s contention is that such a move could help hold back the growing trade influence of America’s biggest competitor for Africa’s resource spoils – China.

News of the bill comes at a crucial time for South Africa whose continued inclusion in Agoa has been threatened by the government of Cyril Ramaphosa’s prevarication over condemning Russia for its war on Ukraine, electing instead to claim that it prefers to remain non-aligned. But the ANC’s ideological affiliation to Russia has not only proven its supposed non-alignment to be false but was also exposed by the sinister docking of a blacklisted vessel, the Lady R, at Simon’s Town naval base last December.

American legislators advocating that the 2023 Agoa Forum set down for SA be moved elsewhere. Because of certain ideological utterances made by ministers and high-level representatives of Ramaphosa’s government, Western Cape premier Alan Winde, accompanied by a team of delegates from the DA-run province, saw fit to visit the US in a bid to protect the non-tariff benefits that about 20% of the country’s exports have under Agoa.

Of crucial importance though is an Agoa eligibility review by US legislators that is currently being finalised. These requirements state among other things that Agoa countries refrain from ‘supporting’ acts of terrorism. When Ramaphosa and fellow ministers don Palestinian keffiyeh scarfs in condemning Israel’s bombardment of Gaza, without condemning Hamas for its October 7 attack on Israel, it sends out yet another bad message. The eligibility report is due in November. [1]

UK hauliers see biggest freight rate rises in almost a year

Date: 18th October 2023

Road freight rates in the UK have seen their biggest increase in almost a year – a marked contrast to the situation in mainland Europe, where there are worries that rates have yet to find their floor.

UK rates climbed 3.3%, month on month, in September – the sharpest rise since December 2022, according to the TEG Road Transport Price Index, in part been propelled by the reintroduction of the HGV levy, clean air charges, rising fuel prices and higher business charges.[2]

The end of the CBER may restore trust between shippers and carriers

Date: 17th October 2023

What we are really hoping for now is that some trust can be re-established between shippers and shipping lines,” said Global Shippers Forum director James Hookham.

He was reflecting on last week’s decision from the EC not to renew liner shipping’s controversial Consortia Block Exemption Regulation (CBER). “It was very important that the commission looked at how it [the CBER] was operating during a very defined period – the Covid era,” he said. “The thing I noted most from the Covid experience was the decline in trust between shippers and their carriers, and a belief by many shippers that carrier ability to co-operate was somehow acting against their interests.

“This was only compounded when several competition regulators issued warnings to carriers “That is not to suggest there was any collusion among lines, but the fact is that many shippers simply didn’t believe they could trust what they were being told by carriers,” he explained.

The EC considered CBER renewal on how it worked between 2020 and 2023, which had left some experts scratching their heads – Vespucci Maritime’s Lars Jensen revealed “If you want to do something structural with an industry, it seems kind of silly to base it on analysis of the most extreme period the industry has ever seen. This was a period where freight rates jumped to levels never thought of before, through absolutely no fault of the carriers. It was a period where you saw service levels, in terms of schedule reliability, decline more rapidly and faster than ever seen before, driven by pandemic disruptions, Suez Canal blockages and what have you.” [3]

EU’s Carbon Price on Shipping Threatens Growth, Nations’s say

Date: 16 th October 2023

The European Union’s looming rules to put a carbon price on shipping emissions threaten economic growth by benefiting ports outside the region, according to six member states.

The countries — mainly along the bloc’s Mediterranean coastline — are worried that shipping companies will be able to dodge paying the price by docking at ports close to, but outside of, the EU.

Italy called for the European Commission, the bloc’s regulatory arm, to look at possible solutions, such as financial compensation. “We have to put corrective measures in place,” said Gilberto Fratin, Italy’s minister for the ecological transition. “It has major negative consequences for the competitiveness of EU industry.”

The bloc has already said Egypt’s East Port Said and Morocco’s Tanger Med should be identified as “neighboring container transshipment ports” to prevent evasion of the EU’s carbon market rules. Italy’s Fratin said there should be stricter rules so that more ports are included. Portugal, Malta, Greece, Cyprus and Belgium all expressed similar concerns at a meeting of environment ministers in Luxembourg Monday. [4]

Israel update: force majeure, congestion and war-risk premiums, but carriers still booking

Date: 16 th October 2023 Ian Wiegman Zuiderkruis

Evergreen has declared force majeure on the 1,778 teu Ever Cozy, which was unable to call at Israel’s port of Ashdod as scheduled, and diverted to Haifa. The line said the situation was beyond its control and that all cargo destined for Ashdod had been discharged at Haifa, adding: “Thereafter, the subject contract of carriage is treated as terminated and all carrier’s responsibilities shall cease.”

It told customers: “To protect your interests and to minimise your costs exposure, we sincerely suggest you to take delivery of the goods at port of Haifa as soon as possible. If necessary, we encourage you to contact your cargo insurer for assistance.”

Although Ashdod continues to operate, lines have noted congestion at the port, whose website is blocked for security reasons. It noted on Facebook: “Even now, we continue the work at the port as usual, while responding to the needs of the state of Israel. The port workers maintain operational continuity – unloading and loading essential goods for the residents of Israel. The port continues to operate as usual… together we’ll win.”

MSC told customers: “At this time, Israel’s major ports continue to function, including key terminals in Ashdod and Haifa, however there is currently congestion at Ashdod due to increased security checks and labour shortages, leading to increased waiting times. Inland services – both road and rail – are fully operational in and around the country.” It said it would continue to accept bookings for Israel, but warned: “Certain dangerous goods are not able to be released in Ashdod port, due to government restrictions for certain UN codes at this time. MSC added that its offices in Israel were closed.

Maersk said it too was continuing to take bookings and its services “remain operational” – also with the exception of dangerous goods at Haifa and Ashdod. It added that it was offering “a number of relief packages for customers with cargo in Israel or bound for Israel”, consisting of a waiver of the change of destination (COD) fee – “subject to re-stowage and shifting costs, plus any ocean freight price difference to the new destination”. And it has stopped the clock on detention and demurrage on all locations in Israel until 8 November. [5]

Carriers fight back against sub-economic rates with FAK hikes

Date: 20th October 2023

Ocean carriers are planning a wave of sizeable FAK rate hikes across the major east-west tradelanes next month, in an attempt to swivel voyage results back into the black. And, with the 2024 budget season looming, the shipping lines will want to jettison unprofitable cargo from their customer portfolios.

For example, MSC this week announced new freight rates, effective 17 November, from the Mediterranean and North Europe to the US, Canada and Mexico, including a $4,400 per 40ft base rate from Antwerp to New York.

Container spot rates on the transatlantic have collapsed by around 80% over the past 12 months, driven down by carrier capacity upgrades and new market entrants – for instance, Xeneta’s XSI North Europe to US east coast component this week was down at $1,336 per 40ft.

Meanwhile, the Hapag-Lloyd and CMA CGM-led circa-$1,800 per 40ft new Asia-North Europe FAK rates, valid from 1 November and supported by radical capacity management, are starting to have some impact on the market.

However, this has yet to be reflected in the Asia-North Europe container spot indices, which remained flat this week at just under $1,000 per 40ft. On the transpacific, carriers have underpinned container spot rates with a huge blanking programme around the Chinese Golden Week holiday, peaking next week with North American west coast terminals receiving 19 fewer vessels than advertised. [6]

Young recruits desperately needed to beat global truck driver shortage

Date: 19th October 2023

International road transport association the IRU has reiterated warnings that the global truck driver shortage has become a “chronic problem” that could drive the industry into failure. “Most regions are facing a growing shortage of truck drivers, which is posing significant risks to the supply chains we all rely on,” said IRU secretary general Umberto de Pretto. “What is even more concerning is the low rate of young people entering the profession. The trucking industry has an ageing driver population that we must structurally address.”

According to the newest IRU data, there are over 2.8 million truck driver vacancies around the world, with more than 50% of companies reporting they face driver shortages. And the IRU warned that the issue was worsening, with vacancies set to more than double over the next five years, possibly reaching an astounding 6.5 million.

The IRU said this projection was largely due to the ageing population of truck drivers. In Europe 33% of drivers are over the age of 55 and looking to retire within the next decade, while just 5% are under 25. “The industry desperately needs more young people,” said Mr de Pretto. [7]

Idle tonnage passes a million teu as bigger box ships go into lay-up

Date: 18th October 2023

The amount of containership capacity idled has surged again, the latest survey from Alphaliner reporting 315 vessels (1.18 million teu) in lay-up, representing 4.3% of the global fleet. In its fortnightly review of the inactive container vessel fleet, the consultant recorded a big jump from the 271 ships, for 942,035 teu, shown as idled two weeks previously.

It said the idle tonnage figures had been boosted by the addition of several larger ships, including four 12,500 to 18,000 teu vessels and three of more than 18,000 teu, either anchored, or sent to shipyards for surveys and repairs.

Hitherto, the main increase in the inactive containership fleet has come from small and medium-sized vessels, but increasingly carriers are deciding to mothball their surplus large ships that have been displaced by even bigger newbuild arrivals.

Moreover, a ratcheting-up of carrier blanking programmes, including introducing winter service schedules to mitigate weak demand prospects, has resulted in de-facto network reductions and a consequential tonnage oversupply. [8]

SOURCES AND REFERENCES

SACO CFR

[1] https://www.freightnews.co.za/article/bill-could-extend-agoa-inclusion-two-decades

[2] https://theloadstar.com/uk-hauliers-see-biggest-freight-rate-rises-in-almost-a-year/

[3] https://theloadstar.com/the-end-of-the-cber-may-restore-trust-between-shippers-and-carriers/

[4] https://gcaptain.com/eus-carbon-price-on-shipping-threatens-growth-nations-say/

[5] https://theloadstar.com/israel-update-port-congestion-and-war-risk-premiums-but-carriers-stillbooking/

[6] https://theloadstar.com/carriers-fight-back-against-sub-economic-rates-with-plans-for-fak-hikes/

[7] https://theloadstar.com/young-recruits-desperately-needed-to-beat-global-truck-driver-shortage/

[8] https://theloadstar.com/idle-tonnage-passes-a-million-teu-as-bigger-box-ships-go-into-lay-up/

Best regards,

The Inter-Sped Team