News

Fracht Australia News - April 2020

31/3/2020

 

 

“You don’t have to be great to start but you have to start to be great.”

                                                Zig Ziglar 

COVID-19 

Further to our Newsflashes of 23 and 25 March, please note the latest updates: 

• Various Government representatives have confirmed that freight and logistics providers are ESSENTIAL SERVICES and can continue to operate. This includes the complete supply chain across ports, roads, rail, maritime, stevedoring, intermodal transfer facilities, distribution, warehousing, freight yards as well as freight forwarders, customs brokers, airports and other members of the distribution chain such as drivers, pilots and support staff.  All Fracht companies in Australia provide essential services and we continue to operate in all our facilities in compliance with Covid-19 rules. The majority of our staff work remotely.
• Thanks to the fact the freight is considered an essential service THE STATE AND TERRITORY BORDER CLOSURES only have a minimal effect on the movement of trucks at the moment.
• The Australia Border Force (ABF) increased the list of products that are now SUBJECT TO EXPORT CONTROL under regulation 13GI of the Customs (Prohibited Exports) Regulation 1958. These goods include disposable face masks, disposable gloves, protective eye wear in the form of goggles, glasses or visors, alcohol wipes and hand sanitizer. The export controls are aimed at opportunistic hoarders or profiteers. Legitimate exporters, Australian manufacturers, humanitarian organisations etc are exempt.
• Approximately 50% OF WORLDWIDE AIRFREIGHT NORMALLY MOVES ON PASSENGER AIRCRAFT.  The cancellation of the vast majority of passenger services to / from Australia and in many other countries has created an acute shortage of air cargo capacity threatening vital supply lines for medical equipment and protective material. IATA made an urgent appeal to Governments around the world to remove bureaucratic processes and obstacles where possible for charter flights, e.g. overflying and landing permits, slot restrictions, 14-day quarantine requirement for flight crews, operating hour curfews etc. 

 SEAFREIGHT NEWS 

• THE CORONAVIRUS MAY LEAD TO THE LARGEST DECLINE IN SHIPPING VOLUMES IN LIVING MEMORY. The unprecedented amount of blanked sailings due to Covid-19 now continues as a result of factory closures in Europe, widespread social lockdown, inventory reductions and port restrictions. According to liner analyst SeaIntelligence Consulting a 10% decline in global container shipments which would equate 17 million TEU (twenty foot equivalent unit) may become a reality.
• THE RECENT DECLINE IN OIL PRICES significantly reduced the differential between the “old” High Sulphur Fuel Oil and the newly mandated Low Sulphur Fuel Oil which came into force in January 2020. The difference was USD 300 per ton and today it’s only USD 60 per ton.
• SWIRE SHIPPING DEPLOYS A NEWBUILD MULTIPURPOSE SHIP into the South East Asia / Papua New Guinea and Solomon Island trade. “The Changsha” is a 30,400 deadweight ton vessel 186 metres long, 32.2 metres wide and a 20.5 metre draught equipped with three 45 tonne cranes. The vessel is designed to carry break bulk and project cargo and also has the capacity to carry up to 1,650 TEU.
• FOLLOWING THE OUTBREAK OF COVID-19 THE FIJIAN GOVERNMENT CEASED ACCEPTANCE OF ALL CONTAINER VESSELS IN THE PORT OF LAUTOKA.  The port of Suva remains open for containers.
• THE LEADING ROLL ON / ROLL OFF CARRIER TO AUSTRALIA – WWL – TAKES DECISIVE ACTION in connection with the Covid-19 crisis. This includes the withdrawal of the 2019 dividends, green recycling of up to four vessels and cold lay-up of up to ten vessels. Schedules will also be adjusted. 

AIRFREIGHT NEWS 

• AIRFREIGHT RATES TO / FROM AUSTRALIA HAVE SOARED due to the cancellation of the vast majority of flights to / from Australia.  There are still a few full freighter services operating but they are totally overbooked. Due to the shutdown of factories in Europe demand is currently declining but it still outstrips available airfreight capacity. In some markets airlines have selectively commenced using passenger aircraft just for freight. The situation changes daily.
• ACCORDING TO THE LATEST IATA FIGURES INTERNATIONAL AIRFREIGHT DECLINED for the 10^th consecutive month in January 2020. The total market dropped 3.3% and the Asia Pacific region which represents 34.5% of the total volume lost 5.9%. No doubt the figures for February and March will far worse.
• IATA’S LATEST SCENARIO FOR EUROPEAN CARRIERS indicates a potential revenue loss of USD 76 billion due to Covid-19. “A decline of this magnitude puts at risk about 5.6 million jobs and USD 378 billion GDP supported by air transports”. 

AROUND THE WORLD 

• ABU DHABI / UAE: Fracht opened a new office in Abu Dhabi in February. Under the expert leadership of our old friend Carsten Weisner, the experienced Fracht Abu Dhabi team will provide prompt and highly professional services for a comprehensive range of logistics and freight forwarding requirements: Fracht Middle East Shipping Services LLC, PO Box 48084, Office 1103, ADCP Tower D, Al Douj Street, Electra, Abu Dhabi / UAE, T +971 2 4440414 - E info@fracht-me.com or c.weisner@fracht-me.com
• BRAZIL: Good news for Brazilian importers: Brazilian Customs eased the requirement to present original documents and they will now accept good quality scanned documents to allow smoother customs clearance.
• GENERAL - Several countries around the world are now in lockdown, including of course Italy and Spain. This means that all non-strategic activities and companies are shut down temporarily. 

AUSTRALIAN PORTS AND AIRPORTS 

• THE THREE MAIN AIRFREIGHT TERMINAL OPERATORS HAVE INCREASED THEIR CHARGES. Dnata, Qantas and Menzies upped their handling fees effective 1 March, 30 March and 1 April.
• THE STEVEDORES DP WORLD ANNOUNCED A FEE HIKE EFFECTIVE 1 May in West Swanson Terminal and Fishermans Island Terminal and 8 May in Port Botany. In view of the current Covid-19 crisis some industry sources labelled this move “tone deaf”.
• AUSTRALIAN BORDER FORCE IS WORKING TRHOUGH SPECIFIC ARRANGEMENTS FOR MARITIME CREW to permit international crew members to enter Australia to join a ship, ships and their crews arriving in Australian ports to be allowed to berth and operate and crew signing off a ship to be able to transit and depart Australia or join another vessel in Australia.

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