Newsletter – February 18, 2021
AIR FREIGHT UPDATES
‘Handling hell’ for air cargo players as congestion brings chaos to airports
Airlines and forwarders are hoping the congestion and chaos sweeping through airports across Europe and the US “is reaching its peak”.
The Loadstar has received numerous reports of delayed or lost cargo amid chaos at handling facilities, with the latest complaints concerning Turkish Airlines’ facility at New York’s JFK. Read more here (login required).
US Airlines Come Back To The Top Of The Global Pack By Capacity
US airlines have come at the top of the global capacity. American, Delta, Southwest, and United Airlines came out as the top four US carriers. Chinese carriers followed, with a few other top players rounding out the top ten. Here’s a look at where airlines stand. Read more here.
OCEAN FREIGHT UPDATES
Another Maersk ship loses hundreds of boxes overboard in the Pacific
The 13,100 teu Maersk Eindhoven became the latest boxship casualty on the Pacific yesterday, suffering a blackout while en route to California and a subsequent loss of hundreds of containers overboard. The accident happened near Japan as the 11-year-old ship made its way from Xiamen in China to Los Angeles. The crew are safe, propulsion has been restored and vessel tracking suggests the ship has turned around and is making for an Asian port. Read more here.
LA port boss: ‘We need to catch our breath’
The boss of the sorely congested port of Los Angeles has called for a breather, diverting ships to other destinations on the US west coast.
Both the ports of Long Beach and Los Angeles in San Pedro Bay – America’s top two box gateways – have been seen record boxship queues in recent weeks, stretching 20 km down the Californian coastline on the back of massive imports and a nasty bout of Covid taking out much of the workforce. Read more here.
US FMC orders carriers and terminals to explain ‘excessive’ D&D charges
US marine regulatory agency the Federal Maritime Commission (FMC) is to order container lines serving Los Angeles, Long Beach and New York, and box terminal operators in the same ports, to explain how they calculate detention and demurrage charges.
FMC commissioner Rebecca Dye, who has been leading the organisation’s investigation into the application of detention and demurrage fees, will issue the orders to determine if “legal obligations related to detention and demurrage practices are being met”. Read more here (login required).
Shipping lines anticipate another bumper year
Ocean operators are expecting an increase in their income this year as first quarter income looks set to boost returns and demand for capacity has continued to be strong, during the first month of the year.
German carrier Hapag-Lloyd reported that the year had got off to an “exceptionally strong” start, with preliminary figures for January showing earnings before interest, tax, depreciation and amortisation (EBITDA) expected to be at least US$1.8 billion, from US$517 million in January 2020. Read more here (login required).
Port of Halifax Remains Fluid Despite Weather Challenges
Many ports throughout North America are experiencing delays and congestion due to extreme weather and increased cargo volumes. The Port of Halifax is addressing these challenges through daily collaboration with its supply chain partners, including the terminal operators and CN rail, to keep its North American gateway fluid and reliable. Recent extreme cold weather has forced railways to shorten train lengths, which has an impact on all ports. Despite slightly elevated container dwell times that have impacted railcar supply, Halifax continues to process vessels with no delay and is keeping dwell times low.
For more information on Halifax’s dwell KPIs, vessel arrivals and special alerts, visit the Port of Halifax Operations Centre (login required).
Chinese factories won’t build enough boxes to save US shippers
There are still not enough containers in the right places to carry the world’s cargoes. The hope was that Chinese container factories would shift into ultra-high gear — that the industry would build its way out of the equipment crisis.
It hasn’t happened.
In fact, Chinese factories are intentionally not going into their highest gear, according to Tim Page, interim president and CEO of container-equipment lessor CAI International (NYSE: CAI). Instead, they are managing output to keep prices high. Read more here.
CANADA BUSINESS – GOVERNMENT UPDATES
Canadian retailers can now barter for excess inventory
Retail Council of Canada (RCC) and BarterPay Canada Inc. are bringing the RetailBarterPay trading platform to retailers across Canada.
Through the platform, retailers will be able to trade excess or slower-moving inventory at no discount. This can be in the form of hard goods or services that are monetized into BarterPay Barter Credits. One BarterPay Barter Credit equals one Canadian dollar for valuation, accounting and tax purposes. Read more here.
INTERNATIONAL BUSINESS- GOVERNMENT UPDATES
Higher diesel prices likely as freeze shuts down Gulf Coast refineries
Diesel prices got another boost Monday as the deep freeze hitting Texas that drove up natural gas prices to astronomical levels late last week is now resulting in the closure of refining capacity.
The one refinery that has confirmed its closure due to weather-related problems is the biggest in the U.S. — the Motiva refinery in Port Arthur, Texas, at 600,000 barrels per day. Reuters and Bloomberg both reported that the closures had been confirmed with Motiva, which is 100% owned by Saudi state oil company Aramco. Read more here.
China overtakes U.S. as Europe’s main trading partner for the first time
*The latest figures, released by Eurostat, showed that China now has an even bigger role in how European economies perform.
*The Chinese economy is performing slightly closer to pre-Covid levels in comparison with other parts of the world, where restrictions are still taking a toll on activity.
*The European Union seems willing to strengthen economic ties with China. Read more here.