Newsletter – February 25, 2021
AIR FREIGHT UPDATES
Cargo load factors remain strong despite Chinese New Year
Air cargo load factors remained strong during the Chinese New Year as demand did not fall as strongly as it has in the past.
Statistics from CLIVE Data Services show that in the first week of the Chinese New Year, which this year started on February 12, services from China to Europe saw demand drop by 25-30% compared with a week earlier, while capacity was reduced by around 20%. Read more here.
U-Freight: ready for final phase of HK air cargo security screening
In Hong Kong, the enhancement of international standards on air cargo security announced by the International Civil Aviation Organization (ICAO) commenced on January 1. 2020 and, the fourth and final stage starts on March 1, 2021, for which U-Freight is fully prepared. Read more here.
CMA CGM AIR CARGO to make first flight March 8 from Liege to Chicago
The CMA CGM Group, a world leader in shipping and logistics, announces that its new specialist air freight division CMA CGM AIR CARGO is to begin operations starting March 8 with the first Airbus A330-200F cargo flight between Liege and Chicago. Read more here.
OCEAN FREIGHT UPDATES
Montreal says the threat of another strike is already causing cargo diversion
The Montreal Port Authority (MPA) is calling for dockworkers’ union CUPE 375 and the Maritime Employers Association (MEA) to “quickly reach an agreement to avoid a new work stoppage by the dockworkers”.
The strike at Montreal in August 2020 ended when the Union and the MEA agreed to a seven-month truce to allow negotiations to continue up till March 2021 without any further disruption. “Nearly a month before the end of the truce between the employer and the union, scheduled for March 21 at 6:59 a.m., the MPA has found that several Quebec and Ontario businesses that use the Port of Montreal, including some that move critical cargo to combat COVID-19, are already diverting containerized goods to other ports, and that others are planning to do so if a new work stoppage occurs soon,” the MPA stated. Read more here (login required).
India looks to enter container manufacturing
India is looking to enter the container manufacturing sector in a big way as the country aims to boost its exports.
Container manufacturing is expected to be part of India’s Atmanirbhar Bharat programme, which is a vision for India envisaged by prime minister Narendra Modi to make India a self-reliant nation. Under the program, five pillars were outlined – economy, infrastructure, system, vibrant demography and demand. Read more here.
Splash Extra: The coming supercycle?
Mentions of supercycles in the media have leapt by 400% over the past month as commodity prices have jumped. Speculation about a commodity supercycle has in turn seen dry bulk operators report a frenzied month of fixtures, prompting many shipowners to rekindle memories of shipping’s last great supercycle, which came to a shuddering halt in 2008.
The February issue of Splash Extra takes a look at the potential for both a commodities and shipping supercycle and features the thoughts of owners who experienced dry bulk’s last boom such as Precious’s Khalid Hashim and Mandarin’s Tim Huxley as well as experienced shipping cycle analysts Dr Martin Stopford and Dr Roar Adland. Read more here.
Ocean carriers hold all the cards in contract talks with shippers
It’s annual-contract negotiation season for U.S. importers — and the hand they’ve been dealt couldn’t be worse. The deck is heavily stacked in ocean carriers’ favor.
Incredibly, Asia-West Coast spot rates are now nearing a base rate of $5,000 per forty-foot equivalent unit (FEU), not including a few thousand dollars of extra charges slapped on top. There’s talk that spot rates could stay strong until Q4, if not 2022. Read more here.
Boxship owners see 13-year high in charter rates as carriers hunt for tonnage
Containership charter rates have hit 13-year highs and shipowners are locking these in with carriers on three- and five-year charters.
Alphaliner says the supply of container tonnage “remains tight across the board” as unrelenting cargo demand and chronic port congestion tie up the world’s box ship fleet. Read more here.
GROUND AND RAIL UPDATES
Winter storms squeeze capacity, drive spot rates up 20 cents
Dry van spot rates rose about 20 cents per mile last week over the previous week, as winter weather and storms swept over much of the U.S. and tightened capacity, DAT Principal Analyst Dean Croke said on a market update Tuesday. Read more here.
INTERNATIONAL BUSINESS- GOVERNMENT UPDATES
Cargo crime focus shifts to warehouses
Cargo crime patterns have changed significantly over the past year, as criminals adjust to different freight flows due to the Covid-19 pandemic.
A cargo theft report for 2020 compiled by leading international transport and logistics insurer TT Club and global supply chain intelligence provider BSI highlights “significant new trends in risks both regionally and globally”, including a shift in the focus of cargo crime to warehouses. Read more here.