Freight & Logistics Update 19 September

SOUTH AFRICA

Air Freight: On the import side, peak is in gaining pace with demand for space on the increase – as always we encourage all our customers & partners to start prebooking shipments as far in advance as possible. Exports – there has been a surge in demand with some carriers (notably Emirates and Swiss Air) experiencing backlogs.

Sea Freight: Strong winds continued to affect all the main South African ports.

South Africa to NWC/UK/West Mediterranean – MSC Vessels omitting Coega Port

MSC no longer accept to co-load any type of lithium batteries with other dangerous cargo in the same container to safeguard public/crew/equipment and vessels.

The MSC Antonia, a Liberian-flagged container ship, lost 46 containers and damaged 305 others during severe weather off the South African coast on August 28, 2024. The vessel was en route from Colombo to New York. South African Maritime Safety Authority and Nelson Mandela Bay Municipality are conducting mop-up operations and urging caution to maritime operators and the public. The ship is now in Cape Town for assessment and repairs, while local authorities continue to collect debris along the coastline (already 2 tonnes cleared). The public is advised to report any sightings of containers or debris and to avoid handling any wreckage for safety reasons.

DURBAN

The port has experienced low wind speeds during the week. Appointment slots are constrained due to high volume of containers moving through Durban Terminals.

Pier 1 : 9 days delay
Pier 2 : 10-16 days delay
Durban Point : 3 days delay

CAPE TOWN

The port has experienced windy weather during the week. Normal volumes of traffic and operations continue as per normal.

CTCT : 3-4 days delay
MPT : 1-2 days delay

PORT ELIZABETH

The port has experienced strong winds during the week. Normal volumes of traffic and operations continue as per normal.

PECT : 3-5 days delay
NCT : 7-11 days delay

AFRICA & INDIAN OCEAN ISLANDS

East African ports are experiencing congestion however no severe impact noted. We will continue to monitor the situation and provide updates accordingly.

Sea Freight: East African services ex-South Africa remain under pressure as MSC no longer sailing directly from Durban, resulting in longer transit times & Messina only sail once monthly, Hapag Lloyd offers service however with a longer transit routing via Jebel Ali.

The East African ports of Dar-Es-Salaam and Djibouti both experiencing increased port congestion.

Tema Port is experiencing port congestion which affects many other West African destinations that tranship through this port.

Air Freight: Most services running smoothly. Notable exceptions:

Air France is no longer servicing Ougadougou, Burkina Faso, Bamako, N’djamena, Niamey

ANGOLA

Berthing delays of 3 days experienced at Luanda port.

GHANA

Berthing delay of 1 day experienced at Tema port.

IVORY COAST

Berthing delay of 1 day experienced at Abidjan port.

KENYA

Berthing delay of 1 day experienced at Mombasa port.

MAURITIUS

Berthing delays of 4 days experienced at Port Louis.

MOZAMBIQUE

Berthing delays of 7 days experienced at Maputo port.

NAMIBIA

Berthing delays of 6 days experienced at Walvis Bay port.

NIGERIA

Berthing delays of 4 days experienced at Apapa port.

SENEGAL

Berthing delays of 2 days experienced at Dakar port.

TANZANIA

Berthing delays of 9 days experienced at Dar es Salaam port. High levels of congestion continue to be experienced at this port.

NORTH AMERICA

Strikes in USA: 13 days away from the end of the contract for the Labor Unions, and still no agreement in place. President Biden’s administration advised that he does not intend to invoke a federal law to prevent a port strike on the East Coast and Gulf of Mexico if dockworkers fail to secure a new labor contract by the Oct. 1 deadline. https://www.usnews.com/news/top-news/articles/2024-09-17/biden-wont-block-potential-strike-at-east-coast-ports-administration-official-says

Air Freight: Operations are running smoothly, this despite strong demand which is set to continue for the remainder of the year.

BA are currently not accepting bookings into the USA , due to capacity constraints.

Sea Freight:

Vessel scheduling amendments are on the increase – impacting both import and export

services to and from the USA – With many changes only being advised last moment.

The USA have seen their peak season start much earlier than usual in preparation for the potential strike and the bulk of the import volume has come in already for the year-end shopping holiday season. No agreement has been reached between the Labor Unions and the USMX (United Stated Maritime Alliance).

With the US Presidential Election scheduled on November 5 th , the Labor Unions are hoping for the demands be approved to avoid a strike.

CANADA

Montreal

Berthing delays of 2 days experienced at this port.

Toronto

Berthing delays of 5 days experienced at this port.

Vancouver

Berthing delays of 4 days experienced at this port.

USA

The port strikes announced by the International Longshoremen’s Association (ILA) at the U.S. East and Gulf Coast ports have not yet been confirmed. Negotiations on a new contract run until 30 September. We will continue to monitor the situation and provide updates as they are received.

Terminals Updates:

New York/New Jersey – Vessel waiting time is up to 3 days. Truck line port congestion continues.
Norfolk – Vessel waiting time is up to 4 days.
Charleston – Vessel waiting time is up to 6 days.
Savannah – Vessel waiting time is up to 3 days.
Miami/Port Everglades – Vessel waiting time is up to 2 days.
Houston – Vessel waiting time is up to 2 days.
Oakland – Vessel waiting time is up to 1 day.
Los Angeles/Long Beach – Vessel waiting time is up to 2 days.
Seattle – Vessel waiting time is up to 2 days. T18 will be closed on September 20, 2024.

Vessel Scheduling Amendments (information below is correct at time publication):

MSC Jersey – with voyage 432S will perform a port swap and call Durban first. Vessel will also call DCT instead of Pier 1.

MSC Carmen – with voyage 430S/434N will call Coega first before proceeding to Cape Town.

Filotimo – with voyage 433N will call Cape Town Container Terminal instead of Cape Town Multi-Purpose Terminal.

LATIN AMERICA

ARGENTINA

Berthing delays of 10 days experienced at Buenos Aires port.

BRAZIL

Berthing delays of 5 days experienced at Santos port.

MEXICO

4 days berthing delays experienced at Altamira and Veracruz ports while Manzanillo has delays of 5 days.

NORTH WEST CONTINENT, UNITED KINGDOM, MEDITERRANEAN

Air Freight: Export services into Europe: All running smoothly.

Import services from Europe: With EU Summer holidays behind us and peak season now in full swing – Increased demand and space constraints expected to increase

Sea Freight: Vessel schedule delays continue to impact the region and EU Summer holidays has resulted in the usual reduction of staff at many key ports and terminal.

Predictions are that peak season will start early in the EU as many importers & exporters aim to navigate the multiple disruptions faced by Sea Freight supply lines.

BELGIUM

Berthing delays of 4 days experienced at Antwerp port.

FRANCE

Berthing delays of 3 days experienced at Le Havre port.

GERMANY

Berthing delays of 5 days experienced at Hamburg port and 2 days at Bremerhaven port.

ITALY

Berthing delays of 4 days experienced at Genova port and 5 days at La Spezia port.

NETHERLANDS

Berthing delays of 3 days experienced at Rotterdam port.

SPAIN

Berthing delays of 2 days experienced at Barcelona port.

SWEDEN

Berthing delays of 4 days experienced at Gothenburg port.

TURKEY

Berthing delay of 1 day experienced at Istanbul port.

UNITED KINGDOM

Berthing delays of 2 days experienced at London Gateway port.

Vessel Scheduling Amendments (information below is correct at time of publication):

MSC Yashi B – will call Port Elizabeth instead of Coega.

INDIAN SUB-CONTINENT & MIDDLE EAST

Sea Freight: Import services out of the Indian Sub-Continent remain under pressure with increased demand causing capacity constraints Nhava Sheva’s APMT terminal is also battling serious congestion caused by excessive container stock (exceeding 20,000 TEUs). Vehicles are now taking up to 18 hours to enter. This is now having a knock on effect on other terminal movements. Export services to the region are running relatively smoothly.

Air Freight: Export & import services are for the main part running very smoothly

However, in the Middle East we are seeing an increasing number of airlines cancel or suspend their services to Israel and/or Lebanon and some other neighbouring territories.

https://www.reuters.com/business/aerospace-defense/airlines-suspend-flights-middle-east-tensions-rise-2024-08-08/

INDIA

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

UNITED ARAB EMIRATES

Berthing delays of 2 days experienced at Jebel Ali port.

ASIA PACIFIC (Including Oceania)

China’s Golden week holiday’s are approaching, which also means a high demand for space in the weeks prior and post. Upcoming holidays in China are their Mid-Autumn festival from 15-17 September and then the week of 1 – 7 October for their National Day.

In order to avoid disruptions within your supply chain, please ensure that you communicate with one of our team soonest so that we may advise accordingly.

Sea Freight: The port of Singapore remains heavily congested – This impacting services (both imports and exports) that are routed via Singapore. In a drive to avoid a fall in container rates, many shipping lines have blanked a number of export sailings from Asia – this prior to the Chinese national holiday in early October. The blank sailings will likely result in upward rate pressure.

Air Freight: Demand for space coming out of the Far East remains elevated but manageable with all service running smoothly. Export space into the Far East is also running very smoothly.

HONG KONG

Berthing delay of 1 day experienced at this port.

KOREA

Berthing delay of 1 day experienced at Busan port.

MALAYSIA

Berthing delay of 1 day experienced at Port Kelang.

NANSHA

Berthing delay of 1 day experienced at this port.

QINGDAO

Berthing delays of 2 days experienced at this port. Vessel bunching experienced at the port.

SHANGHAI

Berthing delays of 3 days experienced at this port. Berth situation expected to deteriorate as “Typhoon Bebinca” makes landfall in week 38.

NINGBO

Berthing delay of 1 day experienced at this port. Berth situation expected to deteriorate as “Typhoon Bebinca” makes landfall in week 38.

SHEKOU / YANTIAN

Berthing delays of 3 days experienced at Shekou and Yantian ports. Heavy congestion experienced due to port closure caused by “Typhoon Yagi”.

XIAMEN

No berthing delays experienced at this port.

XINGANG

Berthing delays of 2 days experienced at this port.

SINGAPORE

Berthing delay of 1 day being experienced at this port. FCL containers transshipping in Singapore have expected delays of 2-3 weeks.

TAIWAN

Berthing delays of 2 days 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

Movement at South African ports improves – Saaff/Busa

11/09/2024

Container movement at South Africa’s port terminals has rebounded, with a daily average of 8,246 containers, marking a 26.1% increase from the previous two weeks. This recovery comes after a downward trend in late August. However, ports along the coast continue to face challenges due to adverse weather conditions, high swells, and equipment breakdowns. These issues have affected operations in Table Bay, Cape Town, Durban, Port Elizabeth, and Ngqura.

The ports have experienced various operational constraints, including network issues and a distress vessel at Cape Town’s Berth 601. Durban’s port executive highlighted swell volatility as a particular concern, with one vessel delayed for about 31 hours due to high swells. Additionally, rail operations on the corridor linking Durban with Gauteng were minimal. Despite these challenges, authorities report that plans are in place to resume normal operations. Source

Walvis Bay container handling goes private from October

12/09/2024

Namibia’s Port of Walvis Bay is set to begin private operational management on October 1, 2023, through Terminal Investment Namibia (TiN), a subsidiary of MSC’s Terminal Investment Limited (TiL). This transition, originally planned for the second quarter of 2023, follows a $300 million renovation of the container facility. The move aims to attract private capital for infrastructure improvements, increase cargo volumes, and enhance the port’s competitiveness and efficiency. Namport CEO Andrew Kanime expressed excitement about the partnership, emphasizing its potential to strengthen Namibia’s position as a key logistics hub in Southern Africa.

The privatization comes at a crucial time for Walvis Bay, which has been facing challenges in attracting the anticipated cargo volumes following its renovation. Industry experts have noted that the port is losing business due to high rates. The new agreement with TiN is expected to address these issues by improving shipping connectivity, increasing vessel traffic, and enhancing container handling capacity. The concession also includes immediate plans to widen and deepen the port’s entrance channel to 16 meters, allowing larger vessels to access the port and potentially realizing Walvis Bay’s volume ambitions.

This development occurs against the backdrop of regional competition, particularly from Angola’s Lobito Corridor, which offers a shorter route for mineral exports from the Copperbelt region. To counter this, Namibia is developing a new North-West Corridor to shorten the hinterland route to Zambia and the Democratic Republic of Congo. However, road construction for this new corridor is currently behind schedule. The privatization of Walvis Bay’s operations is seen as a strategic move to strengthen Namibia’s competitiveness among other coastal states and developing ports in the region, potentially contributing significantly to the country’s vision of becoming a regional logistics hub. Source

Shippers seek alternatives as east coast port strike looms

10/09/2024

North American shippers and forwarders are anxiously monitoring the potential standoff between dockworkers and terminal operators on the US east coast. Shipping companies are preparing contingency plans in case of a port shutdown, drawing lessons from recent experiences with the Canadian rail strike. During the Canadian strike, there was a significant increase in port swaps, with vessels rerouting to alternative ports like Seattle instead of Vancouver. The uncertainty caused by the strike led to a doubling of blank sailings (canceled voyages) in Vancouver and an uptick in Prince Rupert.

The situation on the US east coast is more complex, with carriers yet to take significant strategic action but weighing their options daily. Many East Coast ports are already struggling with off-schedule services due to Cape of Good Hope diversions and rough winter weather off South Africa’s coast. The impact varies among ports, with some experiencing increased delays and congestion while others show improved schedule reliability. The scale of the effect seems to correlate with the proportion of services using the South African passage, with ports like Charleston having 48% of its services affected, compared to Halifax’s 12%.

Carriers are now assessing alternative options in case of a US east coast port strike. Potential alternatives include Caribbean transshipment hubs like Kingston, Caucedo, or Bahamas Freeport; Canadian gateways such as Halifax, Montreal, and St John; or even West African ports as temporary storage areas. The situation is further complicated by seasonal weather conditions around the Cape of Good Hope, which have increased existing delays on affected routes over the past three weeks. As the industry watches the developments closely, the potential for disruption in the US east coast ports continues to loom large. Source

Union urges Hamburg port workers to agree deal following disruptive weekend

09/11/2024

A potential breakthrough has emerged in the standoff between German dockers and port employers, with the Central Association of German Seaport Enterprises (ZDS) presenting an offer that the workers’ union, Ver.di, has recommended for acceptance. The proposed deal, spanning 14 months until August 2025, includes wage increases, improved overtime rates, and an inflation compensation bonus. Ver.di is now surveying its members on the offer, with results expected by the end of the month. This development follows five rounds of negotiations and comes after previous offers were rejected, leading to escalated industrial action.

The breakthrough news coincides with recent disruptions at the Port of Hamburg, where rail operators were locked out on Friday morning as part of “warning strikes” by the union. This action, which began last Wednesday, has significantly impacted port operations and transport costs. Rail freight operators, such as Metrans, have expressed concern about the situation, noting that customers will ultimately bear the brunt of these disruptions. The port’s intermodal operator has warned that they will no longer be able to absorb the increased transport costs resulting from these circumstances. Source

ZIM and MSC join forces on trade lanes

10/09/2024

Israeli shipping line ZIM has entered into a new long-term operational cooperation agreement with Mediterranean Shipping Company (MSC) for the Asia-US East Coast and Asia-US Gulf trades. Set to launch in February 2025, subject to regulatory approvals, this partnership aims to provide ZIM customers with extensive port coverage and improved service quality while achieving significant operational efficiencies. ZIM’s CEO, Eli Glickman, stated that this collaboration is a result of their fleet renewal program and will enhance their competitive position, particularly in the Asia to US East Coast trade.

The three-year agreement includes slot swap and vessel-sharing arrangements across six services, connecting Asia with the US East Coast, West Coast of Mexico, Caribbean ports, and US Gulf ports. This partnership aligns with ZIM’s focus on decarbonization, promoting the use of larger and more eco-friendly vessels, including those powered by liquefied natural gas (LNG). ZIM was the first carrier to introduce LNG capacity to the Asia-US East Coast trade and currently offers two services fully operated by these green vessels, giving them a unique competitive advantage in this strategic trade. Source

Alliance networks taking shape

13/09/2024

The container shipping industry is undergoing significant changes for 2025, with major alliances and carriers reshaping their East-West liner schedules. Maersk and Hapag-Lloyd have released a second draft network plan for their Gemini Cooperation, while THE Alliance (soon to be rebranded as Premier Alliance) has announced new services. Mediterranean Shipping Company (MSC) has also published a fresh network brochure as it prepares to operate independently. Additionally, slot exchange agreements have been established between MSC and Premier Alliance for Asia-Europe routes, and between MSC and Zim for Transpacific trades.

These developments address some pressing questions, particularly for carriers in THE Alliance/Premier, but many uncertainties remain. The ongoing Houthi attacks on shipping in the Red Sea have led both MSC and the Gemini carriers to create two versions of their network plans, offering both Suez Canal and Cape of Good Hope routing options. A decision on which version will be implemented from February 2025 is expected to be made in October, with the Cape of Good Hope route currently considered the default option due to the persistent security risks in the Suez Canal.

Maritime consultants Drewry note that while these announcements provide more clarity on the 2025 East-West container services landscape, external events will ultimately dictate the final network structure. The cooperation between MSC and Zim across multiple trades was seen as predictable due to their existing partnerships. However, despite the scale of this cooperation, a takeover is not considered likely due to MSC’s history of organic growth and Zim’s strategic importance to Israel. Source

Ocean freight rates continue to tumble as peak comes to an early end

13/09/2024

Spot freight rates on major container shipping lanes continue to decline as demand remains flat, with no signs of the usual pre-Golden Week surge in activity. The most dramatic drop was seen on the Asia-North America east coast route, with rates falling 21% to $6,661 per 40ft container. This decline is attributed to shippers rerouting cargo to the west coast due to the growing possibility of a strike on the US east and Gulf coasts starting October 1. The lack of time to get imports into east coast ports before this date has led to a significant drop in demand for this route.

Other major east-west trade routes also experienced declines, though less severe. The Shanghai-Los Angeles route saw a 7% decrease to $5,627 per 40ft, while Asia-North Europe and Asia-Mediterranean routes had double-digit declines. These drops suggest that the 2024 peak shipping season has concluded earlier than usual. Despite these declines, current spot rates remain significantly higher than they were a year ago, with some routes showing increases of over 200% year-on-year.

The potential strike by the International Longshoremen’s Association (ILA) is a major factor influencing shipping patterns. With negotiations between the ILA and port operators at a standstill over issues like wages and port automation, a strike seems increasingly likely. However, many importers have already moved their peak season shipments earlier in anticipation of this possibility, which may minimize the impact on holiday season goods availability for consumers. Analysts expect east coast rates to continue declining in the coming weeks, while west coast rates may see some buoyancy as volumes shift away from the east coast. Source

SOURCES & REFERENCES

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.

JJ & The Inter-Sped Team