News

Fracht Australia Logistics News - August 2024

30/7/2024

AROUND THE WORLD 

• RED SEA SITUATION SEES MAERSK ALTER BOOKING WINDOW. MAERSK Line is to set its booking window for cargo in the Asia-Pacific region to 28 days from 15 July. The carrier says that as the Red Sea situation continues, it is continually seeking ways to offer customers “more certainty and stability”. Maersk says that by adjusting the booking window, it can offer customers more certainty and reduce the likelihood of changes.
• LIVE SHEEP EXPORTS MAY BE GOING BUT BRAZIL IS BACK.  Minister for Agriculture, Fisheries and Forestry, Murray Watt announced on 2 July that sheep meat exports to Brazil had been restored following a suspension of trade in 2020 because of changes in Brazilian requirements. The announcement follows just a day after legislation passed through the Senate to ban live sheep exports by sea from 1 May 2028. The resumption of trade with Brazil gives access for Australian sheep meat producers to the 217 million people who live in the South American country
• CHINA LAUNCHES NEW RAIL SERVICE to boost volumes to Europe via Caspian Sea. Meeting in Astana recently, Chinese president Xi Jinping and Kazakh president Kassym-Jomart Tokayev launched the new China-Europe Railway Express service to capitalise on a hybrid model to speed up Europe-bound services.The Trans-Caspian International Transport Route (TITR) begins at Lianyungang Port, China, crosses Kazakhstan, the Caspian Sea, Azerbaijan and Georgia en route to Europe.
• HURRICANE BERYL WREAKS HAVOC. Hurricane Beryl has been impacting supply chain operations as it barreled through the Gulf coast, leaving storm surges, flash flooding, heavy rains and power outages in its wake as it moved through Texas. It forced terminals in Galveston and Houston to close temporarily. However, Port Houston has confirmed that both of its terminals had reopened and were “up and running”. Inland intermodal facilities were forced to close, with engineering teams assessing the situation.
• EXTREME WEATHER ALONG SOUTH AFRICA’S COASTLINE proved extremely disruptive and in at least one case catastrophic for vessel traffic. Panama-flagged general cargo vessel Ultra Galaxy beached itself on its side on 10 July, while earlier, the 17,859 TEU (twenty foot equivalent unit) CMA CGM Benjamin Franklin was reported to have suffered a loss of 44 containers while transiting along South Africa’s coast. 30 containers were also reported to have been damaged onboard.
• AUSTRALIA-JAPAN GRAPE EXPORT NEGOTIATIONS A SUCCESS. In an announcement made last week, the minister for agriculture Senator Murray Watt hailed the lifting of varietal restrictions on types of Australian grapes, following the successful completion of technical market access negotiations. More than 130 table grape varieties will now be available for export to the key Asian trading partners for the upcoming table grape export season, which runs from December to May. Previously, Australia was only able to export three varieties of table grapes to Japan, including Crimson Seedless, Thompson Seedless and Red Globe. 

SEAFREIGHT NEWS 

• RO-RO RIVALS LAND BIG FISH. PCTC (Pure Car / Truck Carrier) specialists Wallenius Wilhelmsen and competitor Höegh Autoliners have each announced big contract wins in the global vehicle transport sphere. Wallenius Wilhelmsen has signed what it describes as “a significant multi-year contract” with a leading industrial equipment manufacturer. Rival Höegh Autoliners has signed a 5-year contract with a major international car producer for transport of cars from US and Mexico to the Middle East.
• MSC NOW HOLDS A 20% SHARE of the global container shipping market, in terms of capacity offered, a record in the liner industry. And the carrier is just “one big ship delivery away” from the 6 Million TEU milestone, according to new Alphaliner data. The Swiss shipping line’s fleet has grown faster than any other carrier, “fuelled by a massive newbuilding programme, countless second-hand acquisitions and, to a lesser degree, chartering”, said Alphaliner today. MSC’s fleet capacity passed the 5m teu milestone in May last year.
• TAIWANESE REGIONAL CARRIER TS LINES will join SeaLead Shipping’s relaunched Asia-US West Coast (AWC) service, marking its comeback to long-haul trades. Dubai-based SeaLead’s spokesperson told The Loadstar TS Lines would assign its two 2,900 TEU vessels, TS Melbourne and TS Tacoma, to the AWC, which was relaunched on 17 June. The start of the deployments has yet to be confirmed.
• MANAGING FREIGHT SPEND is the biggest concern for shippers and forwarders, as the supply chain volatility driving ocean rate hikes appears to have no end in sight. In Xeneta’s mid-year ocean freight update, CEO and co-founder Patrik Berglund said: “Carriers were expecting to record massive financial losses in 2024, but the skyrocketing spot market will see them deliver a full-year profit, which seemed improbable six months ago.” The crowd sourced analytics platform found that average spot rates on major fronthaul trades ex Asia were now more than 300% up on December.
• SPOT RATE SURGE, WITH SURCHARGES CAUSING MORE PAIN. Since the 1 July implementation of a series of peak season surcharges (PSS) and new FAK (freight all kinds) levels, the largest east-west container trades have seen a week of double-digit spot freight rate increases. Drewry’s World Container Index reading for its Shanghai-Los Angeles leg grew 12%, meanwhile, the WCI’s Shanghai-New York leg grew 17% and the Shanghai-Rotterdam leg also saw double-digit growth, rising 10%.
• HAPAG-LLOYD EYES BIGGER PROFITS as freight rates continue to rise. On the back of rocketing spot freight rates, Hapag-Lloyd upped its 2024 financial guidance after releasing unaudited first-half results. “Because recent strong demand and increased short-term freight rates have exceeded expectations, earnings momentum for the second half of the year is likely to be above previous expectations,” the company said in its stock exchange announcement.
• OOCL REPORTS 2Q, 1H 2024. The first of the major container lines to report calendar 2024 second quarter results, OOCL has seen significant improvement year-on-year as well as for the first half. Released by Hong Kong exchange-listed parent Orient Overseas (International) Limited (in turn controlled by China’s COSCO Group) the unaudited operational updates for the second quarter ended 30 June 2024, show total revenues increased by 14.4% to US$2,264.6million, as compared to the same period in 2023.
• NYK COMPLETES INSTALLATION OF WIND-ASSISTED PROPULSION UNITS. VentoFoil creates propulsion with the pressure difference on both sides of the wing and is expected to help reduce greenhouse gas emissions during vessel navigation. NYK says the unit takes in wind through its suction port and obtains greater propulsion by amplifying the pressure difference. The system can be activated and deactivated through a touch panel installed on the ship’s bridge, enabling operation without increasing crew workload.
• CMA CGM’S SECOND QUARTER ‘ROBUST’. The persistent geopolitical tension impeded the fluidity of global trade in 2Q 2024, CMA CGM says, but also supported demand for cargo shipping. Volumes rose sharply compared to the same period in 2023 but also to 1Q 2024 as growth in Western countries held firm, as did household consumption, while inflation slowed due to the impact of monetary policies, the Marseilles-based carrier said. A downside was congestion “in certain areas”.
• RADICAL OVERHAUL FOR MSC OCEANIA SERVICES. From late August both MSC’s weekly South East Asia-Australia-NZ services, Capricorn and Kiwi Express, will be suspended, without immediate replacement. At roughly the same time MSC will re-instate the Wallaby designation, for a new China-Australia-NZ service to rotate Hong Kong – Yantian – Xiamen – Shanghai – Ningbo – Sydney – Melbourne – Auckland – Bluff – Lyttelton – Wellington – Napier – Tauranga – Hong Kong. In a third major move, MSC’s Noumea Express service will be extended to New Zealand with the addition of Tauranga and Nelson calls, “offering you more options to / from New Caledonia and Fiji”. The new rotation will be Port Botany – Brisbane – Noumea – Suva – Lautoka – Nelson – Tauranga – Port Botany – Bell Bay – Port Botany. 

AIRFREIGHT NEWS 

• AIRFREIGHT SET FOR A TURBULENT SUMMER. During the pandemic, analysts noted the distinct correlation between poor ocean schedule reliability and air freight demand. Shippers that needed certainty chose air. “The air freight market is set for a turbulent summer. If the situation in the Red Sea remains as it is, and we see a further squeeze on capacity during the ocean peak season in Q3, then more importers could shift urgent shipments to air freight. This is already happening and will bring back memories of the Covid pandemic,” said Wenwen Zhang, Xeneta’s airfreight officer.
• PEAK SEASON SURCHARGES LOOMING as air cargo heads into ‘hot Q4’.  Air cargo players look set to introduce a peak season surcharge at the end of August, as capacity comes under pressure.  “We expect lower demand growth, year on year, in the second half of 2024 because of such a strong Q4 23 comparison, and we have heard already that certain airlines and forwarders are thinking of implementing a peak season surcharge by the end of August,” said Xeneta chief airfreight officer Niall van de Wouw. 

OCEANIA PORTS 

• QUEENSLAND TO INVESTIGATE MOVING FREIGHT FROM ROAD TO RAIL. The Queensland Government is to fund an investigation into improving rail freight on the Mt Isa rail line to unlock an estimated $500 billion of critical minerals in the North West Minerals Province. That consultation will help government consider the best way to provide incentives for the Mount Isa rail line to encourage freight modal shift from road to rail which will also offer some potential additional flow-on benefits in terms of road safety, road infrastructure management and reducing carbon emissions from reduced heavy vehicle usage.
• AAT BEGINS CRANE DECOMMISSIONING. Australian Amalgamated Terminals at the Port of Brisbane have begun the decommission and removal of their Deer Park ship-to-shore crane to make way for a new mounted crane. The now 40-year old Deer Park will be replaced by a new Liebherr LPS550 rail mounted portal crane, which is scheduled to arrive in October this year.
• SIMULATION LAUNCHED FOR AUTOMOTIVE STEVEDORING. A simulation system developed for the automotive stevedoring space and port services has gone live in Australia. The new system, Motum World, is a software package developed in Australia that has been tailored to driving scenarios in ports, mining, emergency services and other industries. Qube Ports is a launch partner of the stevedoring package, and several of their Australian facilities have been replicated in the software for training purposes. Environments and vehicles are customisable, and instructors can tailor training scenarios, including testing driver responsiveness, awareness, and defensive skills under a host of varying conditions. For trainers, a range of metrics can be recorded, including speed, throttle control, steering precision, braking technique, proximity to other vehicles and road rule infringements. 

CUSTOMER SERVICE 

If you would like further information about any of the above items, please contact one of our friendly Fracht Team members at fracht@frachtsyd.com.au