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Freight & Logistics Update – 5 July 2024

Freight & Logistics Update – 5 July 2024

Good Day Clients & Partners,

It’s the final update before the weekend – please find below the latest Freight & Logistics Update.  As always, the Inter-Sped team are ready to go the extra mile for you – so don’t hesitate to contact us.

SOUTH AFRICA    

Berthing delays experienced at Durban port has increased in comparison to week 25. Carrier scheduling remains erratic with blank sailings, port omissions, rollover and changes to voyages being announced at short notice.

DURBAN

The port has experienced low wind speeds during the week.

  • Pier 1 : 10-12 days delay
  • Pier 2 : 10-14 days delay
  • Durban Point : 3 days delay

 

CAPE TOWN

The port has experienced windy weather during the week.

  • CTCT : 0-2 days delay
  • MPT : 0-2 days delay

 

PORT ELIZABETH

The port has experienced low wind speeds during the week.

  • PECT : 1-2 days delay
  • NCT : 0-2 days delay

 

AFRICA & INDIAN OCEAN ISLANDS    

ANGOLA

  • Berthing delay of 1 day experienced at Luanda port.

 

GHANA

  • Berthing delays of 3 days experienced at Tema port.

 

IVORY COAST

  • Berthing delay of 1 day experienced at Abidjan port.

 

KENYA

  • Berthing delays of 2 days experienced at Mombasa port.

 

MAURITIUS

  • Berthing delays of 5 days experienced at Port Louis.

 

MOZAMBIQUE

  • Berthing delays of 5 days experienced at Maputo port.

 

NAMIBIA

  • Berthing delays of 8 days experienced at Walvis Bay port.

 

NIGERIA

  • Berthing delays of 4 days experienced at Apapa port.

 

TANZANIA

  • Increased berthing delays of 15 days experienced at Dar es Salaam port. This is due to congestion being experienced.

 

NORTH AMERICA    

CANADA

Montreal

  • Berthing delays of 5 days experienced at this port.

Toronto

  • Berthing delays of 5 days experienced at this port.

Vancouver

  • Berthing delays of 2 days experienced at this port.

 

USA

Terminals Updates:

  • New York/New Jersey – Vessel waiting time is up to 2 days.
  • Norfolk – Vessel waiting time is up to 1 day.
  • Charleston – Vessel waiting time is up to 8 days. Omissions from all Carriers slightly reducing the extent of the delays, however still up to 8 days delay this week with a slight decrease to 4-6 days delay next week.
  • Savannah – 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. Houston Ship Channel had intermittent closures from June 18 to June20, 2024 due to high winds and rain from Tropical Storm Alberto.
  • Los Angeles/Long Beach – Vessel waiting time is up to 1 day.
  • Seattle – Vessel waiting time is up to 1 day. Washington United Terminal 1s limiting their operations to a maximum of 3 gangs on vessels and 1 berth operation until further notice due to lack of rail cars to evacuate Imports. They are also delaying startup operations on vessels for same reason. Terminal 18 will be closed on June 28, 2024.
  • Oakland – Vessel waiting time is up to 2 days.
  • Please refer to the following update received from our partner Shipco Transport in the USA in regard to the Port of New York / New Jersey.

 

“The situation at the Port of New York/New Jersey has seen trucking operational challenges, and we’d like to share the latest information. The past six weeks or so have seen strained conditions at the port, including the following challenges: – Daily empty container diversions and restrictions, with over one-third of empty returns redirected to different locations from their original pickup terminals, resulting in significant cost increases and reduced driver productivity.

– A rise in return container issues, with more containers being diverted to Bayonne and Staten Island terminals, further escalating costs and affecting driver efficiency, while adding extra unanticipated tolls.

– Frequent problems with the Terminal Appointment Systems, leading to long lines, driver delays, and decreased productivity.

– Drivers being forced to queue outside the terminal, sometimes extending for several miles. While we remain hopeful for improvement, there is currently little indication of imminent change. We will continue to monitor the situation and provide updates as needed, ensuring our commitment to maintaining the highest level of service while evaluating necessary adjustments.”

 

LATIN AMERICA    

BRAZIL

  • Berthing delays of 8 days experienced at Santos port.

 

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 delays of 3 days experienced at Antwerp port.

 

FRANCE

  • Berthing delays of 3 days experienced at Le Havre port. All strikes have been cancelled until September.

 

GERMANY

  • Berthing delays of 4 days experienced at Hamburg port and 2 days at Bremerhaven port.

 

ITALY

  • Berthing delays of 4 days experienced at Genova port and 8 days at La Spezia port.

 

NETHERLANDS

  • Berthing delays of 2 days experienced at Rotterdam port. Labor at max capacity due to a full berth line-up – delays might occur.

 

SPAIN

  • Berthing delays of 7 days experienced at Barcelona port.

 

SWEDEN

  • Berthing delay of 1 day experienced at Gothenburg port.

 

TURKEY

  • Berthing delays of 2 days experienced at Istanbul port.

 

UNITED KINGDOM

  • Berthing delays of 4 days experienced at London Gateway port.

 

INDIAN SUB-CONTINENT & MIDDLE EAST    

Capacity constraints experienced on services out of the Indian Sub-Continent. This may lead to different transit times being achieved compared to what has been published.

INDIA

  • Berthing delays of 2 days experienced at Nhava Sheva and Chennai ports.

 

UNITED ARAB EMIRATES

  • Berthing delays of 5 days experienced at Jebel Ali port.

 

SRI LANKA

  • Berthing delays of 2 days experienced at Colombo port. Carriers transhipping containers in Colombo are experienced delays in transshipment of 2-3 weeks.

 

APAC (Including Oceania)    

Severe capacity constraints continue to be experienced out of Asia. This along with erratic scheduling, high numbers of vessel roll overs and blank sailings is resulting in delays for shipping out of Asia ports. This may lead to different transit times and schedules being achieved versus what has been published.

HONG KONG

  • No berthing delays experienced at this port.

 

KOREA

  • Berthing delays of 2 days experienced at Busan port.

 

MALAYSIA

  • Berthing delays of 3 days experienced at Port Kelang.

 

NANSHA

  • No berthing delays experienced at this port.

 

QINGDAO

  • Berthing delays of 2 days experienced at this port.

 

SHANGHAI

  • Berthing delays of 2 days experienced at this port.

 

NINGBO

  • 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.

 

XIAMEN

  • No berthing delays experienced at this port.

 

XINGANG

  • Berthing delay of 1 day experienced at this port

 

SINGAPORE

  • Berthing delays of 2 days being experienced at this port. Delays experienced due to bunching of vessels and congestion experienced at the port. FCL containers transshipping in Singapore have expected delays of 3-4 weeks.

 

TAIWAN

  • Berthing delay of 1 day experienced at Kaohsiung port.

 

THAILAND

  • Berthing delay of 1 day experienced at Bangkok port.

 

VIETNAM

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

 

INDUSTRY NEWS     

Transnet takes a hard line about concessionary involvement at DCT:

28/06/2024

The court case between Transnet and APM Terminals (APMT) regarding the 49% concession tender for Pier 2 at Durban Container Terminals (DCT) awarded to International Container Terminal Services Incorporated (ICTSI) will be heard in October. This delay has caused frustration within South Africa’s logistics industry, fueling fears that private sector collaboration to alleviate port congestion will not proceed as planned. Ongoing national unity negotiations add to the uncertainty, with potential changes in industry-related portfolios like public enterprises and transport affecting business continuity. Transnet’s CEO, Michelle Phillips, stated that the company has no control over the objections raised by AP Moller-Maersk’s port operator and emphasized that the concession process would have been completed if left to Transnet.

Phillips highlighted the need for private sector involvement to improve Transnet’s business, despite APMT’s objections causing delays. She reiterated that Transnet will adhere to the court’s decision in October and stressed the importance of following the Container Terminal Operating Contract (CTOC) rules to avoid operational inefficiencies. Phillips noted that Transnet will maintain a 51% stake in Pier 2’s operations and warned against deliberate volume transgressions by private operators. She clarified that while Transnet is not refusing cargo, all parties must respect contractual arrangements to ensure smooth operations and avoid inefficiencies. Source

 

SA wants early extension of African Growth and Opportunity Act:

27/06/2024

With the African Growth and Opportunity Act (Agoa) set to expire in 15 months, South Africa is advocating for an early and substantial extension of the trade agreement with the United States. Since its inception in 2000, Agoa has allowed eligible African countries to access the US market duty-free. Malose Letsoalo, chief director for bilateral trade relations at the Department of Trade, Industry and Competition, expressed optimism about the extension beyond its expiration in September 2025. South Africa hopes the US Congress will renew the pact by early 2024. President Cyril Ramaphosa highlighted Agoa’s role in diversifying African economies, such as South Africa’s automotive industry, which benefits from duty-free exports to the US.

The renewal of Agoa could further diversify African economies and develop regional value chains across the continent. As the largest US trading partner in Africa, South Africa has been actively pushing for the extension. Trade, Industry and Competition Minister Ebrahim Patel voiced confidence in South Africa’s continued inclusion in Agoa at the recent Agoa Forum in Johannesburg. The 20th Agoa Forum, concluded on November 4, 2023, discussed strengthening the US-Africa trading partnership and emphasized the need for extending Agoa beyond 2025 to provide investment certainty. South Africa remains hopeful about the future of its trade relationship with the US and the potential for economic growth and job creation through Agoa. Source

 

FMC orders probe into provider practices as chassis trouble flares up again:

28/06/2024

The US Federal Maritime Commission (FMC) has launched an investigation into the Ocean Carrier Equipment Management Association (OCEMA) following reports of non-compliance with a ruling on shippers’ and truckers’ rights to choose chassis providers. In February, an FMC administrative law judge ruled that OCEMA’s practice of requiring truckers to use specific intermodal chassis providers violated the US Shipping Act, issuing a cease-and-desist order. This decision concluded a legal dispute initiated in 2020 by the American Trucking Associations’ (ATA) Intermodal Motor Carriers Conference, which accused OCEMA of denying carriers and cargo owners the ability to select their chassis provider. The issue was exacerbated during the 2022 congestion, leading to missed appointments and increased detention and demurrage charges.

Despite the February ruling, complaints of non-compliance have prompted the FMC to task its Bureau of Enforcement, Investigations, and Compliance (BEIC) with examining OCEMA’s adherence to the order. If violations are found, the FMC may seek an injunction or civil penalties. Paul Brashier, VP of global supply chain at ITS Logistics, noted that chassis availability has improved due to an influx of new chassis and lower traffic volumes. However, he observed depleted chassis pools in areas like Chicago, Memphis, and the ports of Los Angeles and Long Beach. With predictions of a strong peak season for US imports, Brashier expects pressure on major ports and inland points but remains confident due to proactive management strategies that allow six weeks of preparation. Source

 

Panama Canal Boosts Capacity on Eighth Anniversary of Expansion Project:

27/06/2024

The Panama Canal is celebrating the eighth anniversary of its expansion by increasing its draft and daily transits amid an ongoing water crisis. Starting today, the maximum authorized draft will be raised to 47 feet, with plans to increase it to 48 feet by July 11th. Additionally, a new booking slot for the Neopanamax locks will be available from August 5th, bringing the total daily transits to 35 ships. These enhancements move the canal closer to its design capacity of 36-38 transits per day and a 50-foot maximum draft. Due to a severe drought exacerbated by El Niño, the canal has been operating below capacity, but the onset of the rainy season has allowed gradual increases in daily transits and maximum drafts.

Despite these improvements, water scarcity remains a challenge. Panama Canal Administrator Ricaurte Vásquez Morales emphasized the need to balance the well-being of the population and the reliability of the canal’s services. The canal’s expansion, inaugurated on June 26, 2016, enabled the passage of larger ships, including 90% of the world’s liquefied natural gas vessels, boosting U.S. LNG exports to Asia. Since then, over 25,000 vessels have transited the Neopanamax locks, significantly impacting the global economy. However, addressing climate change effects requires immediate action to identify alternative water sources and increase storage capacity, ensuring the canal’s long-term sustainability and water availability for both the population and its operations. Source

 

Carriers review schedules as another strike disrupts Wilhemshaven terminal:

28/06/2024

Maersk is adjusting vessel line-ups and schedules at the Wilhelmshaven terminal in Germany due to ongoing warning strikes initiated by the trade union ver.di. The latest strike, stemming from a breakdown in collective labor agreement discussions, began at 6 am yesterday and will end at 10 pm tonight. The union is demanding a €3 increase in hourly wages from June 1, along with higher shift bonuses and a 12-month term for the new collective agreement. Previous negotiations on June 17 and 18 failed to reach an agreement, with ver.di negotiator Maren Ulbrich stating that the employers’ offer was still unacceptable. The next round of talks between ver.di and the Central Association of German Seaport Operators (ZDS) is scheduled for July 11 and 12 in Bremen.

In response, Maersk has informed customers that it is reviewing vessel schedules and potential impacts on departures at the Container Terminal Wilhelmshaven (CTW). The company is considering additional measures, such as diversions or move count restrictions, to minimize delays. Maersk warned that congestion might still occur even after operations resume and advised customers to plan their inland haulage accordingly. For those who have booked inland haulage directly with Maersk, the company will reschedule deliveries or pick-ups to the next available slot. The situation remains fluid, depending on the outcomes of ongoing negotiations. Ver.di emphasized that the warning strikes signal employees’ seriousness about their demands. Source

 

Singapore Port Congestion Shows Global Ripple Impact of Red Sea Attacks:

26/06/2024

Congestion at Singapore’s container port has reached its worst levels since the COVID-19 pandemic, mainly due to prolonged vessel re-routing to avoid attacks in the Red Sea. This has disrupted global ocean shipping, causing bottlenecks in other Asian and European ports as well. Retailers and manufacturers are facing surging rates, port backups, and shortages of empty containers just as they are preparing for the peak year-end shopping season. The global port congestion has reached an 18-month high, with 60% of ships waiting at anchor located in Asia. This situation is exacerbated by ships taking longer routes around Africa to avoid the Red Sea, leading to larger cargo offloads at major transshipment hubs like Singapore.

Singapore’s port, the world’s second-largest, has seen severe congestion recently, with average wait times to berth a container ship extending to two to three days, and delays potentially lasting up to a week. Neighboring ports in Malaysia and China are also experiencing increased wait times as ships reroute. The Maritime and Port Authority (MPA) of Singapore and port operator PSA are taking steps to address the congestion by reopening older berths and yards and planning to open more berths at Tuas Port. Maersk, a major container carrier, has already announced it will skip some sailings due to severe congestion. The early arrival of the peak shipping season, driven by restocking activities and anticipation of strong demand, is further straining port capacities, pushing container rates to their highest levels since 2022 and potentially leading to higher prices for consumers. Source

 

FEU rates spike by 233% year-on-year:

24/06/2024

The composite World Container Index (WCI) by Drewry has seen a 233% year-on-year increase for forty-foot-equivalent units (FEUs), now at $5,117, which is also 260% higher than the pre-COVID-19 average. Rates have climbed from $1,420 before the pandemic, leading to extreme volatility. Last week, freight rates from Shanghai to Rotterdam increased by 11% to $6,867 per FEU, from Shanghai to Los Angeles by 7% to $6,441, and from Shanghai to New York by 3% to $7,552. Rates from Rotterdam to Shanghai and Shanghai to Genoa also saw 2% increases, while rates between New York and Rotterdam decreased by 1%. Rates from Los Angeles to Shanghai remained stable, with Drewry expecting further increases due to congestion at Asian ports. Source

 

Chaos now rules the container shipping market, says Yang Ming CFO:

24/06/2024

Yang Ming CFO Peter Su stated that container shipping is so chaotic that explaining port omissions and skipped sailings to shippers is difficult. Ships are detouring around the Cape of Good Hope due to the Red Sea situation, tightening ship and container availability and delaying arrivals in Southeast Asia. Alphaliner reports 1.48 million TEU of new ships delivered so far out of 2.2 million TEU expected, but demand still exceeds supply, reducing capacity by 15-20%. The Q3 peak season has high bookings, but geopolitical tensions and the Red Sea crisis impact predictability and market stability. Analyst Tan Hua Joo noted that normalization might take months, even with ceasefire talks between Israel and Hamas. Source

 

Container Transit Times Soar as Red Sea Crisis Continues Unabated:

24/06/2024

The Red Sea conflict has significantly disrupted international shipping routes, causing longer transit times. According to a Project44 report, Yemen-based Houthi attacks since November have led hundreds of ships to avoid the area, resulting in an 80% drop in Suez Canal traffic compared to May 2023. Carriers are now using alternative routes around Africa or the Panama Canal, extending transit times by 10-14 days for routes from China to Europe, Southeast Asia to Europe, and Southeast Asia to the US East Coast. This new norm has increased overall shipping times by nearly two weeks, and Project44 advises shippers to plan for these delays, especially for the peak retail season. Source

 

Idle containership fleet dips to pandemic era lows as carriers hunt tonnage:

26/06/2024

The global demand for container ship capacity has outpaced supply so dramatically that the number of idled vessels is at its lowest since the pandemic, according to Alphaliner data. In the first half of the year, only 0.7% of the container shipping fleet, or around 210,000 teu out of the 29.6m teu global cellular fleet, was commercially idle. Currently, just 77 ships of 217,038 teu are without revenue-generating activity, and carriers are actively seeking any available tonnage to maintain services, with no ships over 18,000 teu and only two above 12,500 teu remaining idle.

This high demand has driven spot rate price surges and influenced long-term market rates. Flexport warned that these spot rate increases will persist until capacity supply exceeds demand. As almost all vessels are operating at full capacity, carriers are limiting long-term agreement capacities and using peak season surcharges to manage the gap between spot and long-term rates. Additionally, the scarcity of vessels larger than 4,000 teu has led to a sharp rise in forward fixtures for bigger ships expected to be delivered later this year and next. Alphaliner notes this reflects carrier expectations that Suez routings won’t resume soon and a higher-than-expected global cargo volume despite geopolitical challenges. Souce

 

Return to double-digit spot rate gains looms with new FAK hikes and surcharges:

28/06/2024

This week’s container shipping rates saw moderate increases following last week’s surge, as new surcharges and FAK (Freight All Kinds) price hikes were absent. However, expectations point to potential double-digit gains next week with anticipated new price levels starting July 1st. For instance, MSC announced FAK rates of $9,800 per 40ft high-cube for Asia-North Europe and $9,000 to West Mediterranean destinations beginning Monday. Shippers and forwarders in the UK are currently quoted FAK rates ranging from $9,000 to $9,800 per 40ft across all carrier alliances until mid-July, with projections suggesting spot rates could reach $14,000 to $15,000 if peak season demand extends into August and September.

The Drewry World Container Index (WCI) composite index grew by 4% this week, with notable increases seen on routes like Shanghai-Rotterdam, which rose 7% to $7,322 per 40ft. Similar trends were observed in Xeneta’s XSI and Freightos’ FBX indices, recording rates close to $7,000 per 40ft. Modest increases were also noted on Asia-North America routes, with the WCI showing 4% growth on legs like Shanghai-Los Angeles and Shanghai-New York. Looking ahead, the transpacific route could experience substantial increases next week, with CMA CGM planning a $2,400 per 40ft Peak Season Surcharge (PSS) on shipments from Asia to the US starting Monday. Additionally, equipment shortages have intensified inflationary pressures, with average container prices in China doubling to $3,600 for 40ft high-cube containers in just two months, while leasing rates from Shanghai to Rotterdam have tripled since November, currently standing at around $1,700. Despite these challenges, there are indications that market dynamics may adjust as trading volumes decrease and buyers exercise caution amidst the current disruptions. Source

 

SOURCES & REFERENCES     

SACO CFR | Hapag Lloyd | Maersk | MSC | Transnet | The LoadStar Publications | gCaptain.com | Shipco Transport | Splash247.com | Freightnews | Hellenic Shipping News | Seatrade Maritime News | JAS Newsflash

We continue to monitor the freight world developments closely, and will be in contact with you directly for updates relevant to you on an individual shipment level.

 

Best Regards,

JJ & The Inter-Sped Team