Good Day Clients & Partners,

As per the sea Freight alert we sent out yesterday – Sea Freight supply chains in many regions are coming under increasing pressure. With this as background please look out for the sections highlighted in yellow which touch on the challenges faced.

We hope it’s been a wonderful week so far! Below you’ll find the latest Freight & Logistics Update.  The Inter-Sped team are ready to go the extra mile for you – so don’t hesitate to contact us.

SOUTH AFRICA    

Extended berthing delays are common across all ports in South Africa. Delays upwards of two weeks continue to be experienced at Durban ports Pier 2 terminal and it will take several weeks for shipping lines to restore schedule reliability across the trade routes. We can expect more blank sailings, port omissions and changes to voyages being announced at short notice.

DURBAN

The port has experienced low wind speeds during the week.

• Pier 1 : 5-6 days delay
• Pier 2 : 21 days delay
• Durban Point : 3 days delay

 

CAPE TOWN

The port has experienced windy weather during the week.

• CTCT : 5 days delay
• MPT : 6 days delay

 

PORT ELIZABETH

The port has experienced low wind speeds during the week.

• PECT : 3 days delay
• NCT : 3 days delay

 

ASIA PACIFIC / FAR EAST (Including Oceania)    

Capacity constraints, erratic scheduling, roll overs and delays continue to be experienced out of Asia ports. The Sea Freight backlogs have resulted in Increased demand for Airfreight resulting in increased rates and constrained space.

HONG KONG

• Berthing delay of 1 day experienced at this port.

 

KOREA

• Berthing delays of 3 days experienced at Busan port.

 

MALAYSIA

• Berthing delay of 1 day experienced at Port Kelang.

 

NANSHA

• Berthing delays of 3 days experienced at this port.

 

QINGDAO

• Berthing delays of 2 days experienced at this port.

 

SHANGHAI / NINGBO

• Berthing delays of 3 days experienced at Ningbo port and 4 days at Shanghai ports. Delays are due to bunching of vessels and foggy weather experienced.

 

SHEKOU / YANTIAN

• Berthing delay of 1 day experienced at Shekou port and no delays at Yantian port.

 

XIAMEN

• Berthing delays of 2 days experienced at this port.

 

XINGANG

• No berthing delays experienced at this port.

 

SINGAPORE

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

 

TAIWAN

• Berthing delays of 3 days experienced at Kaohsiung port.

 

THAILAND

• Berthing delays of 2 days experienced at Bangkok port.

 

VIETNAM

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

 

INDIAN SUB-CONTINENT & MIDDLE EAST    

Sea Freight Trade lanes from the Indian sub-continent are facing disruptions with port congestion and schedule challenges increasing.

INDIA

• Berthing delay of 1 days experienced at Nhava Sheva port and no delays at Chennai port.

 

UNITED ARAB EMIRATES

• Berthing delays of 4 days experienced at Jebel Ali port.

 

NORTH WEST CONTINENT, UNITED KINGDOM, MEDITERRANEAN    

Schedule delays are increasing in frequency – This mainly due to weather disruption in Northern Europe and increased volumes through the major European transshipment ports as a consequence of the rerouting of Asia-Europe traffic around the Cape instead of through the Suez Canal.

BELGIUM

• Berthing delays of 3 days experienced at Antwerp port.

 

FRANCE

• Reduced berthing delays of 2 days experienced at Le Havre port.

 

GERMANY

• Berthing delays of 3 days experienced at Hamburg port and 2 days at Bremerhaven port.

 

ITALY

• Berthing delays of 4 days experienced at Genova port and 3 days at La Spezia port.

 

NETHERLANDS

• Berthing delays of 4 days experienced at Rotterdam port.

 

SPAIN

• Berthing delays of 5 days experienced at Barcelona port.

 

SWEDEN

• Berthing delay of 1 day experienced at Gothenburg port.

 

TURKEY

• Increased berthing delays of 5 days experienced at Istanbul port.

 

UNITED KINGDOM

• Berthing delays of 4 days experienced at London Gateway port. Commissioning of recently delivered new Gantry cranes in progress. Second batch of cranes just left Singapore and is expected by end of May, beginning of June.

 

AFRICA & INDIAN OCEAN ISLANDS    

ANGOLA

• Berthing delay of 1 day experienced at Luanda port.

 

GHANA

• Berthing delay of 1 day experienced at Tema port.

 

IVORY COAST

• Berthing delays of 2 days experienced at Abidjan port.

 

KENYA

• Berthing delays of 4 days experienced at Mombasa port.

 

MAURITIUS

• Berthing delay of 1 day experienced at Port Louis.

 

MOZAMBIQUE

• Reduced berthing delays of 4 days experienced at Maputo port.

 

NAMIBIA

• Berthing delays of 6 days experienced at Walvis Bay port.

 

NIGERIA

• Berthing delays of 2 days experienced at Apapa port.

 

TANZANIA

• Berthing delays of 14 days experienced at Dar es Salaam port. Delays are due to vessels bunching and high levels of congestion.

 

NORTH AMERICA    

CANADA

Montreal

• Berthing delays of 3 days experienced at this port.

Toronto

• Berthing delays of 4 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 3 days. Berth congestion has eased. Baltimore port closure is having a slight effect on NIT berth/terminal congestion.
• Charleston – Vessel waiting time is up to 3 days. Dock construction at Wando Welch terminal started on March 11, 2024, reducing berth space from 3 to 2 berths for one year. Berths will be given on first come, first serve basis.
• 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.
• Los Angeles/Long Beach – Vessel waiting time is up to 1 day.
• Seattle – Vessel waiting time is up to 8 days. Terminal 18 will be closed on April 26 and May 3, 2024.
• Oakland – Vessel waiting time is up to 1 day. OICT – three cranes are non-operational.

 

LATIN AMERICA    

BRAZIL

• Berthing delays of 3 days experienced at Santos port.

 

NEWS ARTICLES    

 

Ageing equipment hampers productivity:

03/05/2024

Outdated equipment is slowing down work at South African ports, affecting the competitiveness of sea freight. Poor management of funds and neglect have caused a lack of necessary upgrades, making it hard to keep up with improvements. This problem is worsened by increasing debt levels from borrowing money. Peter Besnard, CEO of the South African Association of Ship Operators and Agents, points out that old equipment and insufficient maintenance are major reasons for this slowdown. He says it’s causing delays in getting ships in and out of ports on time. In addition, there are shortages of important marine resources like tugboats, pilot boats, helicopters, and pilots, especially at Durban and Richards Bay ports. Currently, only three out of four helicopters are working, and one has been waiting for parts for months. To help with this, five used tugboats are expected to arrive by the end of May, which will be used at key ports like Durban, East London, and Port Elizabeth to ease some of the pressure. Source

 

Transnet recovery plan forges ahead:

29/04/2024

Transnet’s recovery efforts are progressing well under its new leadership team, according to Andile Sangqu, the group chairperson. Since October 2023, the board has been implementing a plan to tackle challenges affecting the company’s operations and finances. Sangqu highlighted the urgency in addressing these issues, especially after Transnet reported a R5.4 billion loss and a significant drop in rail freight in the 2022/23 period. In February, Transnet appointed Michelle Phillips as Group CEO, Nosipho Maphumulo as group CFO, and Russell Baatjies as CEO for Transnet Freight Rail (TFR). Sangqu mentioned ongoing recruitment for the group chief operating officer position, aiming for completion by late May or June. He emphasized that Transnet’s recovery journey is progressing, with tactical initiatives developed to boost volume and efficiency across divisions.

Sangqu acknowledged the critical need for improvements at the Durban Container Terminal (DCT2), which has been operating under strain since 1963. He highlighted the impact of inefficient ports on South Africa’s trade and economy, noting the country’s poor performance compared to other African ports. Sangqu stressed the importance of private sector involvement in enhancing operational efficiency, particularly in projects like the Pier 2 upgrade at the Port of Durban. Despite legal challenges regarding the selection of International Container Terminal Services, Inc (ICTSI) as the preferred partner for Pier 2’s development, Transnet remains committed to defending its procurement process. Michelle Phillips provided an update on the recovery plan’s progress, noting improvements in rail volumes and revenue growth. She mentioned ongoing challenges, especially on the iron ore line, but expressed optimism as equipment availability improves and additional deliveries are scheduled for key ports. Source

 

Temporary Baltimore shipping channel shift in bid to remove MV Dali:

03/05/2024

The temporary 30-foot channel in Baltimore Harbor, which allowed larger vessels to pass through, has been closed temporarily to focus on removing the MV Dali. This closure has impacted local businesses, with Maersk notifying customers of limited barge services operating through a temporary 20-foot channel until the 30-foot channel reopens on May 10th. However, marine claims consultant WK Webster reports that the 20-foot channel can only handle about 15% of the previous commercial traffic. The MV Dali collided with the Francis Scott Key Bridge on March 26th, leading to damage in supply chains and legal action. Baltimore-based American Publishing has filed a lawsuit against MV Dali’s owner, Grace Ocean (GO), and ship manager Synergy Marine (SM), citing significant revenue losses due to the bridge’s destruction and alleging negligence on the part of GO and SM. Despite GO and SM’s petition to limit liability, American Publishing argues that negligence, including crew training deficiencies and maintenance neglect, led to the collision. This legal action coincides with Baltimore City Council’s lawsuit and an FBI investigation into the incident. Source

 

Rail strike looming in Canada: it will come ‘at the worst possible time:

02/05/2024

The Teamsters Canada Rail Conference (TCRC) has called for strike action against Canadian National Railway (CN) and Canadian Pacific Kansas City (CPKC) following five months of discussions. If an agreement isn’t reached by May 22nd, operators and dispatchers across Canada will strike. CPKC’s CEO, Keith Creel, expressed concern about the potential strike, noting it would coincide with increased demand due to the harvest season. CPKC has proposed two options to TCRC, aiming to address employees’ desires for better pay and quality of life. However, negotiations have yet to yield an agreement, with CN reporting the union’s rejection of their proposed package. Despite hopes for a resolution, both companies are preparing for a strike, prioritizing the interests of shareholders, customers, and employees. Source

 

El Nino, Water Management Issues Blamed for Snarling Panama Canal:

01/05/2024

A study released on Wednesday attributed lower rainfall and subsequent shipping disruptions in the Panama Canal to the El Nino climate phenomenon, not climate change. The reduced water levels in the canal, which experienced its third-driest year on record in 2023, led authorities to limit vessel sizes and numbers. Additionally, water management decisions prioritizing human consumption over canal usage contributed to shipping restrictions. These restrictions caused long wait times for ships, with more than 100 vessels queued at times, disrupting global trade through one of the world’s busiest waterways, responsible for about 5% of global shipping. Despite recent challenges, researchers anticipate a return to normal operations as El Nino ends and the rainy season resumes, expecting the canal system to fully recharge by the end of the year.

El Nino, a natural warming phenomenon in the Eastern Pacific Ocean occurring every two to seven years, was identified as the primary cause of the reduced rainfall in Panama last year. While El Nino has ended according to Australia’s weather bureau, the U.S. National Oceanic and Atmospheric Administration has yet to confirm its conclusion. Water management decisions, including prioritizing drinking water over canal usage, further exacerbated the water level issue. Authorities opted to restrict ship traffic rather than ration drinking water, as done during a previous drought in 2016. Source

 

Indian trade disrupted as port congestion forces liner services to skip calls:

01/05/2024

Indian trade is facing disruptions as port congestion and schedule challenges prompt container lines to skip calls on their services. Companies like CMA CGM and MSC are adjusting their port calls in response to these issues, causing concern among shippers and forwarders. For instance, CMA CGM has changed port calls on its NEMO service, omitting stops at Tanger Med due to congestion and diverting cargo through Hamburg and Valencia. Additionally, the AS9 routing faces disruptions, with calls at Port Kelang and Hong Kong being voided on the X-PRESS Capella voyage, impacting Indian cargo flows. These changes are attributed to severe port congestion and operational constraints, causing carriers to shuffle gate cut-offs and cargo carting windows, complicating shipment planning for exporters and freight forwarders.

The disruptions extend to other services as well, with delays affecting vessel arrivals in India and adjustments made to routes like MSC’s Indus service to the US east coast. Industry experts express concern over deteriorating port flow, citing increased delays and congestion at Asian hub ports, including Colombo. These challenges come at a time when Indian trade stakeholders are hoping for a rebound in goods exports despite economic challenges, highlighting the importance of resolving port congestion and schedule disruptions for the smooth functioning of trade operations. Source

 

Colombo capacity crunch adding to container line woes:

29/04/2024

Container lines are facing significant capacity challenges at Colombo port in Sri Lanka due to disruptions in maritime security in West Asia. Maersk recently shifted a call to Colombo’s East Container Terminal (ECT) for the first time, departing from its usual terminals due to concerns over low productivity rates and infrastructure challenges at ECT. This move, part of Maersk’s West Africa Express (WAX) service, indicates a new partnership between Maersk and SLPA, the terminal’s developer. However, Colombo’s berth availability remains tight, especially with increasing vessel calls for transhipment connectivity, leading to a surge in transhipment volumes in recent months. To address capacity constraints, Colombo is expanding its port infrastructure, with plans for a 600-meter quay at ECT expected to be operational by the fourth quarter and the Colombo West International Terminal (CWIT), led by India’s Adani Group, aiming for full build-out with a capacity of 3.5 million TEUs. These expansions aim to alleviate pressure on Colombo’s port and could potentially benefit Adani’s Vizhinjam container transhipment terminal project in southern India, which is preparing for trial vessel operations next month. Source

 

Déjà vu as major ocean carriers scramble for tonnage and containers:

30/04/2024

The scarcity of container ships and equipment, reminiscent of challenges during the Covid pandemic, is resurfacing as vessels increasingly opt for the Cape of Good Hope route to avoid Houthi attacks. Linerlytica’s recent report indicates that the capacity of ships rerouted to this route will surpass 5 million TEU soon, driven by concerns over maritime security. Despite a nominal fleet growth of 10% annually, effective capacity growth on key routes like Asia-North Europe and Asia-Mediterranean is only at 3% this year due to diversions to the Cape. This diversion has led to a 4% reduction in effective capacity on inter-regional linehaul routes globally, with a particularly significant impact on Red Sea/Middle East/Mediterranean routes.

The surge in demand for ships has intensified the charter market, with major liner operators like CMA CGM, Hapag-Lloyd, Maersk, and SeaLead actively securing vessels at higher rates for longer durations. This surge in demand, coupled with a shortage of container equipment, has led to rising charter rates for ships above 1,700 TEU, while new containers from China are fully booked until June. Mai Boliang, chairman and CEO of China International Marine Containers, noted an increase in container demand since Q4 2023 due to the Red Sea crisis. The shortage of ships and containers has compelled carriers to increase vessel speeds, with ships on the Cape route currently sailing at speeds of 18-20 knots to meet demand. Source

 

Container line reliability improves:

02/05/2024

Container shipping lines have shown signs of stability amidst disruptions in the Red Sea region, with major carriers marking the first improvement in schedule reliability in five months. According to SeaIntelligence’s Global Liner Performance (GLP) report, which evaluates schedule reliability across various trade lanes, container carriers enhanced their reliability by 1.6% in March 2024 compared to the previous month, reaching the highest level of the year. The report attributes the improvement to the normalization of round-Africa routings and the stabilization of carriers’ service networks. However, schedule reliability still falls short of pre-crisis levels, declining by 7.9 percentage points annually, with an average delay of 5.03 days for late vessel arrivals.

Wan Hai emerged as the most reliable carrier, achieving a schedule reliability of 59.7%, followed closely by Hapag-Lloyd and ZIM at 56.1%. Eight lines surpassed the 50% reliability threshold, while PIL ranked as the least reliable with a schedule reliability of 49%. Although 11 of the top 13 carriers recorded a month-on-month improvement in schedule reliability in March 2024, none of them showed an increase in reliability compared to the previous year. Additionally, an Alphaliner report highlighted the delivery of 41 new containerships with a capacity of 260,000 TEU in March and a further 50 ships with a total capacity of 330,000 TEU in April, which is expected to alleviate pressures on the global supply chain. Source

 

Shipper frustration as spot rates rise alongside demand, and cargo is rolled:

03/05/2024

Increasing demand on the Asia-European shipping routes has led to tightened space on vessels, causing frustrations for carriers and forwarders as cargo is at risk of being rolled over. Spot rates are rising rapidly, with some shippers already paying higher prices to avoid rollovers. Maersk CEO Vincent Clerc noted a 9% growth in volumes into Europe, suggesting that European importers are restocking after a period of cautiousness in the previous year. This surge in demand has led to spot rates increasing, with expectations that the peak season volumes will further elevate prices, potentially until Q3 when new deliveries are expected to enter the market. Additionally, carriers are introducing new rates and surcharges, such as Maersk Line’s peak season surcharge (PSS) tripling from $500 per 40ft to $1,500 from 11 May, prompting criticism from importers about the rapid increase in charges and the lack of communication from carriers.

The tightening space on vessels is primarily due to schedule “slidings” rather than blanked sailings, leading to disruptions for shippers, especially those with long-term contracts. Forwarders report significant cuts in allocations by carriers, forcing them to seek alternative pricing options like FAK or premium guaranteed rates to secure space for their shipments. Despite the frustrations, some shippers had expected rates to continue decreasing after Chinese New Year and had budgeted their logistics spends accordingly, adding to the disappointment. While spot rates on main east-west trades remained largely unchanged, concerns persist among shippers about the ongoing challenges in securing space and the uncertainty surrounding future rate increases. Source

 

Red Sea: Aries crew free, but more escalation on the way as box ships flee:

03/05/2024

The crew of the ship Aries, which was captured by Iran’s Islamic Revolutionary Guard Corps (IRGC) nearly three weeks ago, has been released. The ship, operated by MSC and carrying a crew from various countries, was seized in the Red Sea. Iran alleged the ship, linked to an Israeli billionaire, endangered navigation security by turning off its radar in Iranian waters. The release comes amid escalating tensions following recent attacks on ships in the Red Sea, prompting some container ships to reroute their journeys from Asia to Europe through the Mediterranean.

Abdul Malik Al-Houthi, leader of the Houthi militia, has vowed to increase attacks on Red Sea ships until certain conditions are met, including peace between Israel and Gaza and the withdrawal of the US from Yemen. The situation reflects heightened tensions in the region, with concerns over maritime security prompting changes in shipping routes and increased scrutiny on international relations in the area. Source

 

Hapag-Lloyd’s box tracker will ‘close logistics blind spots’:

03/05/2024

Hapag-Lloyd has launched Live Position, a tracking service for two-thirds of its 2.9 million container fleet, equipped with Orbcomm and Nexxiot devices. This service aims to eliminate blind spots in global logistics, allowing real-time tracking and risk management for customers. While tracking devices are common in reefer markets, Live Position offers a new level of visibility, enabling cargo owners to monitor their containers from door to door, providing insights into movement and potential delays. This real-time data not only enhances operational efficiency but also facilitates Customs operations, potentially expediting cargo processing.

The implementation of Live Position marks a significant advancement in container tracking technology, offering benefits beyond location monitoring. The service provides valuable data on container movements, dwell durations, and temperature alerts, aiding in vessel safety and operational management. However, concerns regarding data ownership and privacy persist, particularly in cases of mishandling or misconduct. While shipping lines like Hapag-Lloyd assert ownership of the data, questions remain about access and accountability, with potential implications for regulatory compliance and customer relations. 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,

Coenie & The Inter-Sped Team