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Fracht Australia News - April 2023


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"The starting point of all achievement is desire."
- Napoleon Hill


  • NEW DELHI LAUNCHES MASSIVE MULTI-TEXTILE PARK PROJECT TO BOOST EXPORTS. The Government of India has approved the development of seven large textile parks across the country to transform the emerging Asian economy into a global hub for textile manufacturing and exports. The government said it would spend some $550m to develop the textile parks, which would be a “one-stop solution” to cover spinning, weaving, dyeing, printing and stitching. This integrated infrastructure will drastically reduce logistics costs and make the apparel sector globally competitive.
  • EUROPE RESPONDS TO US GREEN BILL with its own legal push to net-zero. The EC claims the Net-Zero Industry Act (NIZA) will overhaul industry in the EU with a view to achieving the commission’s 2030 carbon targets by driving clean technologies such as solar, wind carbon capture and storage and renewable hydrogen.
  • BEIJING AND MOSCOW DEVELOP RAIL TRADE with a new route and river bridge. Russia’s rail operators have stepped up their efforts to find new markets to offset crippling sanctions imposed by the west following the invasion of Ukraine. Turning east appears to be the only thing Russian rail operators can do. Russia’s rail container volumes plunged last year, with figures indicating a 15.8% year-on-year decline. Fesco noted a 12% drop in imports, to 2.1m TEU (Twenty-foot Equivalent Unit), and exports collapsing 25%, to 1.5m TEU.
  • ANOTHER RAIL STRIKE IN GERMANY to add to European freight troubles. A rail strike in Germany on Monday, 27 March is expected to cause delays and rail freight disruptions, with freight forwarders and shippers calling for flexibility on timings to help the movement of goods, with more disruptions in France also expected.
  • AUSTRALIA-UK FTA a step closer to reality. The Australia-United Kingdom Free Trade Agreement will come into effect soon after the enabling legislation in the UK received Royal Assent. The agreement will enter into force after UK processes are complete and Australia and the UK exchange diplomatic note identifying a commencement date. The Australian government welcomed the announcement that the UK legislation had received Royal Assent.



  • PARTY DEFINITELY OVER FOR OCEAN CARRIERS, despite some strong numbers. The outlook for ocean carriers is a sharp decline in earnings this year, as average freight rates fall and inflation drives cost increases hitting bottom lines.
  • SHIPPING LINES REFUSING TO CUT CAPACITY IN PRICE WAR. Container freight rates are still falling, while charter rates are holding up, suggesting that the liner operators are chasing market share, even if it means a price war. Linerlytica’s latest report, issued on 13 March, stated that around 738,014 TEU of capacity or 2.8% of the fleet, is now idled, down from a peak of 3.8% in February, as shipping lines are reactivating inactive vessels after the Chinese New Year Holidays.
  • CONTRACT RATES THE KEY TO STABILITY, as spot prices continue to fall. The latest rate war on the transpacific and Asia-Europe trade lanes could see some ocean carriers, overly exposed to the spot market, record their first loss-making quarter since the onset of the pandemic. Shippers want stability and service, not rock bottom freight rates. “Service is always going to trump price,” said one delegate at the S&P Global TPM conference this week, “but it has to be a fair price.” he added. The shipping lines are desperate to “rekindle relationships”, get contracts signed and minimum quantity commitments agreed, to avoid being overly exposed to the spot market.
  • WORLD CONTAINER INDEX DECREASES YET AGAIN. Drewry’s composite World Container Index decreased by 3% to USD 1,806.43 per 40’ foot container in a report published mid-March. The index dropped by 80% when compared with the same week last year.
  • SWIRE ANNOUNCES NEW EAST TIMOR SERVICE. Swire Shipping is launching a new shipping service connecting Darwin with Timor – Leste, Singapore and Indonesia. The East Timor Service (EST) will call ports of Singapore, Dili, Darwin and Surabaya. Swire Shipping expects two vessels, Kota Hidayah and Kokopo Chief, to operate the service from around mid-April.
  • MSC TAKES DELIVERY OF MSC TESSA. MSC has taken delivery of the 24,1160-TEU MSC Tessa, said to be the largest containership completed and in service. MSC Tessa is reportedly 399.9 metres in length and 61.5 metres wide. MSC is the largest container line by capacity with 4,748 million TEU, or 18% of the world’s total capacity, according to the latest data from Alphaliner.
  • SHIPPERS PUT MORE PRESSURE ON OCEAN CARRIERS FOR CARBON-FREE SERVICES. A new alliance of major shippers is pushing ocean carriers to step up their efforts to cut back on CO2 emissions. Zero Emission Maritime Buyers Alliance (Zemba) is a partnership of shippers Amazon, Patagonia and Tchibo with the Aspen Institute, an international non-profit organisation. By leveraging their collective buying power, the partners are looking to speed up the shift to green fuel in ocean shipping.
  • 2M AXES ASIA-NORTH EUROPE LOOP, as carriers shop for more tonnage. After successive weeks of blanking its AE1/Shogun Asia-North Europe loop, the 2M Alliance has finally confirmed that the service is to be suspended. It is the first alliance service to be officially culled and is likely to be followed by the removal of more in the weeks to come as ocean carriers try to mitigate the impact of significantly reduced demand.
  • ONE ORDERS 10 BIG CONTAINERSHIPS. Ocean Network Express has ordered 10 new 13,700-TEU containerships. The company said the new vessels would be delivered in 2025 and 2026. In a statement, ONE said the order was in line with its medium-term strategy and follows 10 vessels ordered in May.
  • RO-RO CONGESTION PROMPTS WWL TO MODIFY OCEANIA SERVICE. Wallenius Wilhelmsen, the Roll on / Roll off specialist carrier, has temporarily modified its Oceania service to stabilise and continue to maintain schedule integrity in the global network. The congestion in Australian ports remains at a critical level as large proportions of imported cars continue to fail quarantine inspections after discharge. According to Wallenius Wilhelmsen, average waiting times for vessels to berth (based on reports dated 22 March 2023) were: Melbourne 15-20 days / Port Kembla 9-10 days / Brisbane 5-6 days / Fremantle 8-10 days.
  • THE MOTHER OF ALL BAF’S (BUNKER ADJUSTMENT FACTOR) LOOMS for shippers as green targets advance. Shippers are concerned that maritime discussions on decarbonisation are shaping up to result in the “mother of all Baf’s” as carriers will seek to pass on the costs of using sustainable fuels. The International Maritime Organization (IMO) is set to meet in July and is widely expected to increase its ambition of a 50% reduction in carbon emissions by 2050 to 100%, and will also discuss market-based measures, such as a carbon levy.


  • AIR CARGO MAKES A SOFT START TO 2023. The International Air Transport Association (IATA) released data for January 2023 global air cargo markets showing that air cargo demand declined as economic headwinds persist. Global demand, measured in cargo tonne-kilometres (CTKs), fell 14% compared to January 2022 (-16.2% for international operations). Asia-Pacific airlines saw their air cargo volumes decrease by 19% in January 2023 compared to the same month in 2022. This was an improvement in performance compared to December (-21.2%).
  • SLOWER AIR CARGO MARKET REFLECTED IN DEMAND FOR FREIGHTER CONVERSIONS. Freighter conversions are hitting speed bumps that should slow them down to more sustainable levels of activity, as a leading provider of 737-800 conversions predicts a 20% reduction in the market this year.
  • LUFTHANSA CARGO BREAKS RECORDS AGAIN, but there are ‘shadows on the horizon’.  Lufthansa Cargo is celebrating its third consecutive year of record results, but warned of global air trade declining 16% in December, year on year, and new export orders having been at the same levels since October.  Lufthansa Cargo’s revenue in 2022 rose 22% to EUR 4.6bn, while adjusted ebit was EUR 1.6bn, up from EUR 1.5bn. Sales measured in freight ton km stayed flat at EUR 7.2bn, while capacity increased 17% and utilisation fell 9.9 %.
  • AIRLINES TAKE LEGAL ACTION OF ‘DAMAGING’ REDUCTION IN SLOTS AT SCHIPHOL. Airlines with an interest in Schiphol are taking the Dutch government to court, challenging its decision to cut flights at the airport. The airlines claim the decision to cut Schiphol capacity from 500,000 to 460,000 flight movements are year “is incomprehensible”.
  • NYK LINE SELLS ‘COSTLY’ NIPPON CARGO AIRLINES TO ANA. NYK Line has bucked the flying liner trend, becoming the first shipping line to ditch its air cargo subsidiary citing too high a cost. It has announced it intended to sell 100% of the shares in Nippon Cargo Airlines (NCA) to rival All Nippon Airways (ANA).
  • CATHAY PACIFIC BACK TO BUSINESS-AS-USUAL SOON AS AIRCRAFT RETURN. Cathay Pacific will be operating all its aircraft again by the end of next year, CEO Ronald Lam said this week, noting “light at the end of the tunnel”. Cathay still has 67 inactive aircraft, according to CH Aviation’s database, of which 11 are under maintenance.



  • PORT OF MELBOURNE TRADE VOLUMES DROP IN FEBRUARY. Container throughput volumes at Port of Melbourne were down in February this year compared with the same month in 2022. A total of 219,606 TEU crossed the wharves in February 2023, and 18% decline on February last year.
  • ANGER AS LANDSIDE FEE HIKES ARE ANNOUNCED AT HUTCHISON PORTS TERMINALS. Hutchison Ports Australia (HPA) has issued 60-day Notices of Intention to increase its landside fee tariff and storage and handling charges at its container terminals in Sydney and Brisbane from 22 May. Hutchison Ports proposes to increase its Infrastructure Levy, the cost of container slot booking in the Truck Appointment System (TAS), Stack Run fees (in Sydney), Truck no-show and slot listing fees, as well as sideloader fees. It also plans to introduce a new fee in Sydney for a “double articulated vehicle” (excluding B-doubles).


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