Good Afternoon, Clients and Partners,
We hope you are having a fantastic week so far! Below is the 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 remain extremely congested with the recent spate of bad weather further reducing productivity. In fact, South Africa’s commercial ports handled 14.36% less containers than they did in the preceding week.
The effects have been to delay both imports and exports and reduce the schedule integrity of most shipping lines. Below please find news articles discussing this at greater length.
https://www.freightnews.co.za/article/bad-weather-breakdowns-and-cable-theft-impact-sas-ports
Onto the individual port updates:
DURBAN
Port berthing delays continue to be experienced due to high levels of congestion. The port has reported strong winds during the week.
- Pier 1 : 6-7 days – Recovery estimated in 3-4 weeks.
- Pier 2 : 16 days – STS breakdowns and straddle carriers’ reliability and availability continue. Recovery estimated in 8 weeks.
- Durban Point : 3 days
CAPE TOWN
Port berthing delays continue to be experienced. The port has reported strong winds during the week. High volumes of cargo and traffic experienced at Cape Town terminals.
- CTCT : 11-12 days – 2 Berth operation. TNPA dredging underway and 3rd berth operation will resume early November.
- MPT : 1-3 days
PORT ELIZABETH
Port berthing delays continues to be experienced and has increased from week 42. The port has reported strong winds during the week.
- PECT : 3 days – STS Crane 3 under maintenance.
- NCT : 7 days – 3 berth operation implemented – recovery estimated in 3 weeks.
AFRICA & INDIAN OCEAN ISLANDS
MAURITIUS
- Berthing delays of 7 days experienced at Port Louis.
ANGOLA
- Berthing delay of 1 day experienced at Luanda port.
GHANA
- Berthing delays of 3 days experienced at Tema port. Congestion experienced at the port.
NIGERIA
- Berthing delays of 2 days experienced at Apapa port.
TANZANIA
- Berthing delays of 13 days experienced at Dar es Salaam port. Slight reduced draft at berths 8-11 (10m).
KENYA
- No berthing delays experienced at Mombasa port.
MOZAMBIQUE
- Berthing delay of 1 day experienced at Maputo port.
NAMIBIA
- Berthing delays of 21 days experienced at Walvis Bay port.
NORTH AMERICA
USA
Terminals Updates:
- New York/New Jersey – Vessel waiting time is up to 1 day. The maintenance for Crane 6, originally scheduled to begin on October 1, 2023, has been deferred until further notice to minimize congestion.
- Norfolk – Vessel waiting time is up to 2 days.
- Savannah – Vessel waiting time is up to 6 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 1 day.
- Miami/Port Everglades – Vessel waiting time is up to 3 days.
- Houston – Vessel waiting time is up to 2 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 4 days. Terminal 18 will be closed on November 10 ,13 and 23, 2023, Husky Terminal will be closed on November 13, 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
Montreal
- No berthing delays 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.
Toronto
- Berthing delay of 1 day experienced at this port.
Vancouver
- Berthing delays of 3 days experienced at this port.
LATIN AMERICA
BRAZIL
- Berthing delays of 2 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 2 days 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 Hamburg port and no delays at Bremerhaven port.
- 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 delays of 3 days experienced at London Gateway port.
SPAIN
- Berthing delays of 2 days experienced at Barcelona port.
ITALY
- Berthing delay of 1 day experienced at La Spezia port and 3 days at Genova port.
NETHERLANDS
- Berthing delays of 2 days experienced at Rotterdam port. ECT and RGW terminals had to stop operations for a few hours at the beginning of the week due to dense fog.
FRANCE
- Berthing delay of 1 day experienced at Le Havre and 2 days Fos-sur-Mer port.
TURKEY
- Berthing delays of 2 days experienced at Istanbul port.
INDIAN SUB-CONTINENT & MIDDLE EAST
INDIA
Blank sailings and Diwali celebrations are resulting in serious space limitations and a loss of schedule integrity.
- Berthing delay of 1 day experienced at Nhava Sheva, Mundra and Chennai ports.
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. There has also been an increased number of carriers changing routings and introducing additional port calls and transhipments to their vessel schedules. This may lead to different transit times being achieved verse what has been published.
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 delays of 15 days experienced at this port due to congestion.
SHEKOU / YANTIAN
- Berthing delay of 1 day experienced at Shekou port and no delays at Yantian port.
XINGANG
- Berthing delay of 1 day experienced at this port.
KOREA
- Berthing delays of 2 days 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
SA Business activity subdued despite eased load shedding
Date: 2nd November 2023
The Absa Purchasing Managers’ Index (PMI) has continued its downbeat note, with a poor start to the fourth quarter. This, despite the easing of load shedding that should have led to an improvement in activity.
The Absa PMI headline index dropped further – to 45.4 index points in October – from an upwardly revised 46.21 during September. In terms of the major subindices of the headline PMI, the biggest drag came from the seasonally adjusted business activity index, which declined by a further 2.8 points to 40.3.
“Given that the frequency and intensity of load shedding eased notably in October, the weak performance from the activity index is perplexing,” said economists. “Because the ability to produce presumably improved as the frequency and intensity of load shedding eased, the weak activity reading most likely reflects continued strained demand conditions in South Africa. The pressure on household finances and soft mining output may be among the key reasons why the demand for locally produced manufactured goods is faltering.
“It (demand) is now back to the July 2023 level, when prolonged disruptions on the N3 transport corridor most likely resulted in a (temporary) shortage of inputs. These transport issues contributed to weak manufacturing output.”
“On the consumer front, elevated relative (food and fuel) prices, as well as restrictive borrowing costs, are depressing the demand for local manufactured goods. Regarding industrial demand, constrained mining output amid soft coal and platinum group metal prices, as well as failing railway and port efficiencies, may help to explain the lacklustre PMI production indicator.”
Looking ahead, expectations of purchasing managers deteriorated sharply in October. The index measuring expected business conditions in six months dropped more than 12 points to 43.4. [1]
More products to be added to Agoa’s duty-free list
Date: 2nd November 2023
A further 1 800 products are to be added to the more than 4 600 which are already eligible to enter the United States duty-free, in terms of the Generalised System of Preferences programme. This, according to the American State Department.
Members of the African Growth and Opportunity Act (Agoa) are beneficiaries of this arrangement. According to the US State Department, South Africa is the largest beneficiary, followed by Nigeria, Gabon the Central African Republic and Chad.
South Africa’s Minister of Trade and Industry, Ebrahim Patel, said on Talk Radio 702 that US President Joe Biden had personally endorsed an extension to South Africa’s tenure in 2025, when the agreement will have to be extended or abandoned.
The Agoa Forum is being held at the Johannesburg Expo Centre in Nasrec from Thursday to Saturday. This year’s theme is: Partnering to Build a Resilient, Sustainable and Inclusive Agoa to Support Economic Development, Industrialisation and Quality Job Creation. [2]
Book a slot for Panama Canal transit as protests add to low water delays
Date: 1st November 2023
Shipping lines are facing more disruption and delay at the Panama Canal, owing to the “driest October in 73 years”, as well as anti-mining protests in the region.
The Panama Canal Authority (PCA) announced new operational measures yesterday, following “41% less rainfall than usual”. It said: “The canal and the country face the challenge of the upcoming dry season with a minimum water reserve that must guarantee supply for more than 50% of the population and, at the same time, maintain the operations of the interoceanic waterway.”
The PCA has introduced reservation slots from now until February, limiting transits to 49 between 3 and 30 November, 22 in December, 20 in January and 18 for February.
It advised: “The Panama Canal urges its customers to make reservations in order to transit as programmed. In addition, information is provided in advance, as well as in real time, so that shipping companies can plan and make the best decisions.”
Operations at the canal have also been affected by protests over an agreement to extract copper in Panama between the government and Minera Panama, a subsidiary of Canadian transnational First Quantum. Protests included street blockades in Panama City, with more than 200 arrests. Maersk warned customers yesterday: “Due to the ongoing protests in Panama, operations have been irregular due to blockades.”
More protests have been announced for the next few days to demand a repeal of the agreement, and Crisis24, a risk management platform, advised disruption was likely to continue until “at least mid-November”.
Yesterday, The Loadstar reported that the Suez Canal Authority’s announcement of a 15% fee increase on northbound transits would also prompt demand for Asia-US west coast services.
Analyst John McCown reported that in September, east/Gulf coast ports saw overall inbound volume 6.3% below a 38-month average, while west coast ports were 3.5% above the average. This was the second straight month of under-performance from east/Gulf ports, following a 26-month overperforming streak. [3]
‘Daylight robbery’ – Fury at huge hike in terminal fees by DP World Australia
Date: 2nd November 2023
“Port users have responded angrily to DP World Australia’s planned increase in terminal fees of up to more than 50% at its Brisbane, Melbourne and Sydney operations.
The terminal operator issued a notice of intent to increase its terminal access charges (TACs) on 1 January by 37.5% and 26.2% respectively for exports and imports at Brisbane, at Melbourne they will rise 52.5% and 21.2% and at Sydney by 38.8% and 25.5%.
Ravi Sheshadri, VP commercial for ports and terminals, said: “We forecast more than A$600m (US$386m) in capital expenditure across 2023-2026 across our four terminals in key equipment, civil expansion works and other equipment to cater for greater landside demand.”
However, Paul Zalai, director of Australia’s Freight and Trade Alliance, said: “The federal government sit back like stunned mullets, failing to act on the Productivity Commission’s recommendations [the need for more terminals, to increase competition, and better infrastructure], leaving us with no option but to ramp up noise about this whole situation.”
Nina-Christin Buelk, CH Robinson key account manager for Brisbane, said the planned increases were “daylight robbery,” and that Australian charges were already “exorbitant”. [4]
Threat to contract rates as carriers fail to boost spot market prices
Date: 2nd November 2023
Ocean carriers aim to have at least 50% of their business fixed by way of annual contracts, which are generally agreed at significantly higher rates than volatile spot cargo, but that gap is narrowing.
According to an analysis by Xeneta, its long-term freight rate XSI index declined by 2.6% in October, and has fallen 62.2% in the past 12 months. However, the benchmarking firm has warned that the situation for shipping lines could “get worse before it gets better”.
“Significant changes will come in the new year, following the tender season, when many shippers will be signing new contracts at lower rates than the ones they are replacing,” said Xeneta market analyst Emily Stausbøll.
“I expect the storm to arrive in January, with an even more severe decline in the XSI than in 2023,” she added.”
Providing a few crumbs of comfort for carriers, Ms Stausbøll said she expected the picture to have improved by next May, although overall, she forecasts “a stormy time” for container lines in 2024. [5]
‘Challenging times ahead’: Maersk lets go of thousands of staff
Date: 3rd November 2023
A year is a long time in liner shipping. At the end of 2022, carriers were handing out mega bonuses, some equivalent to more than a year’s pay. Fast forward to today and those same staff face the axe as the sector battles plummeting rates and rampant overcapacity.
Maersk today issued its Q3 results, detailing how it was accelerating staff redundancies whereby the Danish transport giant’s global workforce will number less than 100,000 by the end of this year, having started out 2023 with around 110,000 men and women on its books.
Maersk’s Ocean division suffered red ink for the first time in many years, posting an EBIT of $-27m for Q3, a far cry from the $8.7bn the division recorded in the same quarter last year. “Our industry is facing a new normal with subdued demand, prices back in line with historical levels and inflationary pressure on our cost base. Since the summer, we have seen overcapacity across most regions triggering price drops and no noticeable uptick in ship recycling or idling. Given the challenging times ahead, we accelerated several cost and cash containment measures to safeguard our financial performance,” said Vincent Clerc, the CEO of Maersk. [6]
Bleak times ahead for container shipping: analysts
Date: 2nd November 2023
Despite a spell of super-profits as the world economy took off again and terminal congestion eased after Covid, a huge volume of new capacity is being commissioned and many more ships are scheduled for delivery in the near-to-medium term.
US import volumes have fallen by 15% so far this year, more than any other trade, according to Xeneta. Successful capacity management has helped, the firm’s analyst, Emily Stausbøll noted.
Meanwhile, the Far East export index plunged by 6.9% in October, a drop of more than 75% over the same month last year, while the firm’s import index dipped 6.2% in September. The sub-indices fell to their lowest levels since January 2021 and October 2021 respectively. Stausbøll warned that falling Far East exports will have a marked effect on the XSI when new rates are included in January. She said that the fall in rates from the region will be particularly painful for carriers because of the importance of this major trade and the impact on earnings.
Meanwhile in some positive news a HSBC Global Research report noted a 10.3% week-on-week jump in the Shanghai Containerized Freight Index (SCFI) to move back above the 1,000 points for the first time since 8 September. However, despite the positive movements of the key SCFI index HSBC believes that container shipping rates are still on a downward trend.
“Continued new capacity addition into the market weighed on the near-term prospects of market rates, whereas the much-anticipated peak season failed to fully materialise as expected, and quickly lost steam in lifting market freight rates,” the report said.
HSBC maintains a “subdued but profitable” outlook for container shipping with spot rates hovering around breakeven levels and expected to converge with contract rates once volumes pick-up. [7]
SOURCES AND 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
[1] https://www.freightnews.co.za/article/sa-business-activity-subdued-despite-eased-load-shedding
[2] https://www.freightnews.co.za/article/more-products-be-added-agoas-duty-free-list
[3] https://theloadstar.com/book-a-slot-for-panama-canal-transit-as-protests-add-to-low-water-delays/
[4] https://theloadstar.com/daylight-robbery-fury-at-huge-hike-in-terminal-fees-by-dp-world-australia/
[5] https://theloadstar.com/threat-to-contract-rates-as-carriers-fail-to-boost-spot-market-prices/
[6] https://splash247.com/challenging-times-ahead-maersk-lets-go-of-thousands-of-staff/
[7] https://www.seatrade-maritime.com/containers/bleak-times-ahead-container-shipping-analysts
Best regards,
The Inter-Sped Team
