Freight & Logistics Update 5 July 2023

Good Afternoon Clients & Partners,

Below please find the latest Freight & Logistics Update. We’re always ready to jump in and go the extra mile for you – give us a shout if you have any questions!

SOUTH AFRICA

DURBAN

Port berthing delays at the port has reduced since week 25. The port has reported windy weather during the week.

Pier 1 : 1 day
Pier 2 : 0 days
Durban Point : 0 days

CAPE TOWN

Berthing delays at Cape Town Container Terminal have remined the same as seen in week 25. The port has reported strong winds during the week.

CTCT : 5 days
MPT : 0 days

PORT ELIZABETH

Port berthing delays have remained the same as seen in week 25. The port has reported light rain and windy weather during the week.

PECT : 1 day
NCT : 2 days

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 2 days experienced at Port Louis.

ANGOLA

Berthing delays of 4 days experienced at Luanda port.

GHANA

Berthing delays of 3 day experienced at Tema port.

NIGERIA

Berthing delay of 1 day experienced at Apapa port.

TANZANIA

Berthing delays of 4 days experienced at Dar es Salaam port.

KENYA

Berthing delays of 1 day experienced at Mombasa port. 1 berth is non-operational however no major impact experienced.

MOZAMBIQUE

Pre-Inspection Certificates are mandatory for specified products being imported into Mozambique. No berthing delays experienced at Maputo port.

NAMIBIA

Berthing delays of 5 days experienced at Walvis Bay port.

DJIBOUTI

Electronic Cargo Tracking Note (ECTN) required for destination Djibouti effective 15th June 2023.

NORTH AMERICA

USA

Most terminals will be closed on Tuesday, 4 th July 2023 due to Independence Day Holiday being celebrated.

Terminals Updates:

NY/NJ – Vessel waiting time is up to 1 day. Sever thunderstorms experienced over the past week however, little impact on vessel productivity at all terminals.
Norfolk – Vessel waiting time is up to 2 days. One crane down at Norfolk Int’l Terminal, however, no negative impact in the week.
Savannah – Vessel waiting time is up to 3 days..
Charleston – Vessel waiting time is down to 1 day.
Miami/Port Everglades – Vessel waiting time is up to 1 day.
Houston – Vessel waiting time is up to 2 days. Barbours Cut Container Terminal continues to experience berth congestion due to high yard utilization.
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

The strike by the International Longshore & Warehouse Union has commenced as of 08:00 hrs. PST on July 1, 2023. The following actions are underway from CPKC’s (Canadian Pacific Kansas City) network perspective:

For exports – Gates across CPKC terminals are currently open for the acceptance of dry containers exclusively.
For imports – No disruptions are anticipated. Imports should continue to be picked up as usual.
For reefers – CPKC will cease accepting reefers starting from 00:01 hrs. on July 3, 2023. All terminals will be closed on 1st July 2023 in observation of Canada Day

Vancouver

No berth congestion and ships are working immediately once alongside. Rail productivity remains low due to reduced car supply by both rail providers.

Montreal

Vessels are arriving on proforma schedule. There are no issues with labour availability, and there is good productivity in the terminal yard.

LATIN AMERICA

BRAZIL

Berthing delay of 1 day experienced at Santos port.

NORTH WEST CONTINENT, UNITED KINGDOM, MEDITERRANEAN

BELGIUM

Berthing delay of 1 day experienced at Antwerp port.

GERMANY

Berthing delay of 1 day experienced at Bremerhaven port and Hamburg port. Container Terminal Altenwerder (CTA) experienced several challenges over the last week with technical failures to equipment and intruders on the terminal permission negatively impacting productivity. Terminal is working with full labour deployment through the backlog of vessels. Situation expected to clear by mid next week. Terminal is still able to perform on a high level. Container Terminal Burchardkai (CTB) will start extensive berth renovations on berth 1+2 starting on Monday 26.06. Construction will last for 10 weeks. Berth 1+2 will be closed for operations during the construction. No operational impact expected.

UNITED KINGDOM

Increased berthing delays of 4 days experienced at London Gateway port. Due to the ongoing expansion construction LGP with 20m less pier length minimal impact to operations. Terminal with busy berth schedule but all ships currently have a berth window. Terminal running with full equipment resources available and no operational issues to report.

SPAIN

Berthing delay of 1 day experienced at Barcelona port.

ITALY

Berthing delay of 1 day experienced at Genova port and 2 days at La Spezia port. Genova, GPT terminal has possible gate in restrictions for DG exports, due to elevate number of IMO park limitations.

NETHERLANDS

Berthing delay of 1 day experienced at Rotterdam port. Lack of labour with start of vacation period. Overall productivity slightly reduced since machinery is exposed and susceptible to heat.

FRANCE

Berthing delay of 1 day experienced at Le Havre port and Fos-sur-Mer port. No further strikes announced. In 1 week, the summer vacation will begin in France and is expected to have an influence on labour availability. Vacation period will last until beginning of September.

TURKEY

Berthing delays of 5 days experienced at Istanbul port. Our partners, Shipco Transport Turkey, offices are closed from Tuesday, 27th June 2023 until Friday, 30th June 2023 in observation of Eid alAdha celebrations.

INDIAN SUB-CONTINENT and MIDDLE EAST

INDIA

Berthing delays of 3 days experienced at Mundra port, while Nhava Sheva and Chennai ports are experiencing a 1 day berthing delay.

UNITED ARAB EMIRATES

Berthing delay of 1 day experienced at Jebel Ali port. Our partners, SSC Consolidation, offices are closed from Tuesday, 27th June 2023 until Monday, 3rd July 2023 in observation of Eid al-Adha celebrations.

SRI LANKA

Berthing delay of 1 day experienced at Colombo port.

ASIA PACIFIC

Hazardous commodity acceptance out of China remains a challenge as approval for loading remains subject to carriers’ stringent acceptance protocols.

HONG KONG

Berthing delay of 1 day being experienced.

TAIWAN

Berthing delay of 1 day experienced at Kaohsiung port.

HUANGPU

Berthing delays of 4 days experienced at this port.

SHANGHAI / NINGBO

Berthing delay of 1 day experienced at Shanghai port and 2 days at Ningbo port. Intermittent port closure experienced in Ningbo port due to bad weather. Vessel bunching experienced.

QINGDAO

Berthing delays of 2 days experienced. Vessel bunching experienced outside of the port due to bad weather.

XIAMEN

Berthing delay of 1 day experienced at this port.

XINGANG

Berthing delay of 1 day experienced at this port.

KOREA

Berthing delay of 1 day experienced at Busan port. Vessel bunching continues outside the port.

VIETNAM

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

MALAYSIA

Berthing delay of 1 day experienced at Port Kelang.

THAILAND

Berthing delay of 1 day experienced at Bangkok & Laem Chabang terminals.

SINGAPORE

Berthing delay of 1 day being experienced. Currently experiencing labour shortage and vessel bunching outside the port. No delays experienced for transshipment cargo, only vessel scheduling delays experienced.

NEWS ARTICLES

Durban container terminal raises capacity.

Date: 30th June 2023

“Durban Container Terminal Pier 2 has increased the landside capacity of its empty containers yard by more than four times as part of efforts to reduce vessel stay, Transnet Port Terminals (TPT) said on Thursday.

This follows the introduction by the terminal of changes to the free import storage rule eight months ago, to ensure that all arriving import containers are collected immediately after offloading and stacking. The new rule is an enhancement of the historical process that required a vessel to fully offload all containers before customers were notified to collect.

Durban Terminals managing executive Earle Peters said the new rule and innovative planning are yielding results. “Over the last eight months, stack occupancy has reduced from about 75% to 55% thanks to the new free import storage rule that notifies a customer immediately when their container is offloaded.” He added that the benefits included a fluid yard that could accommodate more equipment to make the operation efficient. The terminal has in this period observed improved truck turnaround time, ship working hours and stack occupancy, and met all its contractual agreements with customers. [1]

Mexican port struggles with auto industry growth

Date: 29th June 2023

“Toyota is looking at alternative gateways for its new Prius model as the port of Lázaro Cárdenas is inundated with auto imports. It is an ominous sign for movement of auto parts, as the Mexican auto industry is going through the roof and demand for vehicles is strong both in Mexico and the US.

Toyota is planning to get some 3,500 units of its new Prius model into Mexico before the end of the year and has aimed to ship about 500 a month. Lázaro Cárdenas, however, is inundated with auto imports from other Asian countries to the point of saturation, the car maker’s local logistics experts found.

The Association of Mexican Automotive Distributors (AMDA) has warned that the nation’s ports are saturated with car imports, especially the Pacific gateways. Lázaro Cárdenas has been the most affected Pacific port.

Last year, the port’s vehicle traffic surged 33.8%. Out of the 280,314 cars imported via ocean into Mexico in the first four months of this year, 169,953 entered the country through Pacific gateways, with 142,203 coming through Lázaro Cárdenas.

Until about five years ago the majority of vehicle imports entered Mexico across the land border with the US or through the Gulf of Mexico, but this has shifted to the Pacific coast. Last year about 70% of imported vehicles came from Asia, with 18.8% out of China. [2]

Further expansion at Europe’s largest port

Date: 29th June 2023

“Rotterdam World Gateway (RWG) has reached agreement with its shareholders DP World, CMA CGM, HMM and Mitsui OSK Lines (MOL) and the Port of Rotterdam Authority about a phased expansion of the RWG terminal.

In a first phase, an extra berth for the deepsea activities will be realized and, in addition to further capacity expansion, the focus will also be on future‐oriented facilities in which automation, sustainability and connectivity remain central.

The extra berth is an extension to RWG’s existing terminal based on the same proven concept; fully automated, CO2 neutral and dedicated handling facilities for all modalities. The total investment is approximately €500m ($545m) and initially includes civil works, quay cranes, storage modules with automatic stacking cranes and electrical automatic guided vehicles.

The berth is expected to be operational at the end of the fourth quarter of 2025 with a commercial rollout in 2026. [3]

Mundra disruption sapping service reliability, say box carriers

Date: 27th June 2023

“Container carriers serving Indian trades have voiced increasing frustration over supply chain painpoints at Mundra Port. The country’s busy trade corridor continues to recover from the impact of a week-long port shutdown caused by cyclone Biparjoy.

Among a widespread shipping halt on the coast, the disruption has been more pronounced at Mundra, as it leads mainline ship calls for India’s containerised trade.

The Container Shipping Lines Association (CSLA) told The Loadstar the congestion at Mundra had seriously affected vessel flow, with an inevitable knock-on effect on sailing schedules. It noted that vessels had experienced berthing delays of about 40 hours, on average, after the port resumed quayside operations on 17 June, and Sunil Vaswani, the association’s executive director, said “a chaotic” berthing window situation at Mundra had sent carrier service reliability into a tailspin. [4]

Chinese operators warned: raise green ambitions or see investors back off

Date: 26th June 2023

Climate change is providing yet another motivation for investment firms to diversify from China. Last week, London’s Legal & General Investment Management (LGIM) sold its stake in China’s Cosco, claiming the shipping line had made insufficient efforts to decarbonise.

Senior manager Stephen Beer told The Loadstar: “We expect the shipping sector to introduce operational innovations to increase fuel efficiency in the short term, with low-carbon fuel switching and relevant investment in the long term. Firms that don’t are likely to face rising investor activism.”

LGIM has condemned both Air China and Cosco this year on sustainability grounds, claiming the Chinese firms are showing insufficient leadership on decarbonisation. [5]

Relief as torrential rain hits Panama

Date: 26th June 2023

The rains have come to Central America, providing some good news for supply chain planners around the world.

Due to the return of the wet weather, the Panama Canal Authority has been able to postpone further draft restrictions which had been due to take place yesterday and on July 9. Further torrential downpours are forecast for much of this week.

Severe drought this year had seen Panamanian officials announce successive draft restrictions. The maximum authorised draft of 13.41 m for the neopanamax locks will now remain in place, while the panamax locks will be able to accommodate ships with drafts of up to 12.04 m. Both draft levels are already down by more than 1.5 m compared to their maximum levels after months of dry weather. [6]

Despite slow demand and falling rates, supply chains still cost a packet:

Date: 28th June 2023

“Although freight rates retreated in most modes last year, supply chains remained eye-wateringly expensive. According to the State of Logistics report, by the Council of Supply Chain Management Professionals, US firms saw their logistics costs surge to almost 10% of national GDP.

The report notes that logistics costs soared 19.6% last year, to $2.3trn – 9.1% of US GDP. Far and away the biggest factor was inventory and carrying cost, which almost doubled, going up 90.2%, fuelled by a succession of interest rate hikes. Warehousing rents stayed in the stratosphere as slower demand was more or less matched by a deceleration of new facility construction.

On the transport side, the maritime sector (including inland shipping) saw the strongest increase, costs rising 18.4%, followed by rail, up 17.6%. Trucking costs were up 6.2% in the truckload sector and 6.4% in the LTL arena. Parcel costs rose 4.7%. Airfreight costs climbed 1.7% overall, while domestic expenditure on air cargo was essentially flat last year, and the report authors expect airfreight spend to shrink this year. They project global air cargo revenue to reach $150bn, 25% lower than in 2022.

The forwarding sector is also expected to fare well, expanding at a compound annual growth rate of 6.3% to 2031. Shippers are looking for more help from their logistics providers. The report says: “The requirements have never been greater, and solutions needs from shippers are off the charts.”

This goes hand-in-hand with a fundamental shift in the connection between cargo owners and logistics partners. The authors diagnosed “a shift among logistics executives from strictly transactional perspectives to a more strategic and holistic sense of the function’s role”, adding that “flexibility and resilience have overtaken cost as the key discussion points among supply chain leaders”.

As the market is settling into a “post-pandemic normalcy”, as the authors call it, they describe this as a time for logistics executives at cargo owners to review former arrangements and determine what they need after the often-frantic improvisations of the pandemic. Hence, the report has been subtitled The Great Reset.[7]

Changes to new IMO Cll rules unlikely, despite industry misgivings:

Date: 30th June 2023

“Despite widespread unpopularity and criticism, it is unlikely any revision will be made to the International Maritime Organization’s Carbon Intensity Index (CII) at next week’s MEPC 80, an IMO source has told The Loadstar.

Issues to be discussed by the Marine Environment Protection Committee include underwater noise, designation of particularly sensitive sea areas for wildlife protection and progress on IMO adoption of a revised GHG strategy.

This new strategy will incorporate a regulatory roadmap for the adoption of new zero-carbon fuels like ammonia, as well as “mid- and long-term measures” to incentivise decarbonisation. A “review of the short-term measure” is also on the agenda, as proposals abound over how to improve the legislation. For example, the World Shipping Council (WSC) is proposing CII uses teumiles, instead of weight, to determine its calculations. [8]

Global shipping outlook: It’s all about capacity as tide turns:

Date: 29th June 2023

“Global trade slipped into contraction at the end of 2022, following the rationalisation of piled-up inventories and the economic and industrial stagnation in the US and Europe. Global trade has also entered a period of lower growth due to geopolitical concerns, protectionism, and supply chain reconsiderations.

Growth is therefore set to remain low into 2024 and this means that shipping tonnage is also under pressure. Nevertheless, we still expect a stronger second half of 2023 once consumer spending on goods picks up alongside a normalisation of spending patterns, reduced inventories and wage growth.

Against the backdrop of faltering economic growth in advanced economies, and emerging economies returning to their trend growth, trade activity is unequal across the world. Consequently, the development in intra-Asian traffic is likely to exceed the global average in 2023 and 2024, and the Middle East and Africa will follow suit. Therefore, regional deployment across the globe will make a difference in carrier performance. [9]

SOURCES & REFERENCES

SACO CFR

[1] https://www.freightnews.co.za/article/durban-container-terminal-raises-capacity

[2] https://theloadstar.com/mexican-port-struggles-with-auto-industry-growth/

[3] https://splash247.com/further-expansion-at-europes-largest-port/

[4] https://theloadstar.com/mundra-disruption-sapping-service-reliability-say-box-carriers/

[5] https://theloadstar.com/chinese-operators-warned-raise-green-ambitions-or-see-investors-back-off/

[6] https://splash247.com/relief-as-torrential-rain-hits-panama/

[7] https://theloadstar.com/despite-slow-demand-and-falling-rates-supply-chains-still-cost-a-packet/

[8] https://theloadstar.com/changes-to-new-imo-cll-rules-unlikely-despite-industry-misgivings/

[9] https://www.hellenicshippingnews.com/global-shipping-outlook-its-all-about-capacity-as-the-tide-turns/

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