News

Fracht Australia News - June 2021

1/6/2021

 

AROUND THE WORLD 

• CANADA: The contract between Montreal’s Longshoremen and the Maritime Employers Association (MEA) expired in 2018 which resulted in unsuccessful renegotiations between the parties and ongoing strike action over the years. The most recent strike by the 1,150 longshoremen that started on 26 April was cut short by the Federal Government which pushed legislation through parliament mandating immediate resumption of work. All terminals in Montreal opened for business again on 31 April. The strikes were costing the economy up to C$ 80 million per week.
• INDIA: Cyclone Tautae forced the 1.35 million TEU (twenty-foot equivalent unit) capacity port of Pipavav to shut on 24 May for at least one week. This put additional strain on India’s shipping networks and cargo disruption as containerships are being diverted to other ports. The 185kph cyclone is categorised as “extremely severe” and disrupted power supply and communication links in the port. India’s supply chains have been reeling under the second Covid-19 wave.
• SINGAPORE: The Singapore Government banned crew changes for sailors who have been in Bangladesh, Nepal, Pakistan and Sri Lanka 14 days before arrival in Singapore. A similar ban was implemented earlier for seafarers who had been to or transited through India.
• USA: US ports are still struggling with congestion. Vessel wait times on the West Coast range from four to 14 days and on the East Coast one to two days. Some inland rail terminals are also experiencing delays while chassis shortages are causing problems in several origins around the country. 

SEAFREIGHT NEWS 

• HAPPY 65TH BIRTHDAY! THE SHIPPING CONTAINER HAS REACHED RETIREMENT AGE but it’s far from retiring. The container is hailed as one of the greatest inventions of the modern world. The first lot of 58 containers was shipped on board the SS Ideal X, a converted World War II tanker on 26 April 1956. The creation of ISO standards facilitated mass production of containers, transport and handling of containers in ports, terminals, rail or roads across the globe as well as the evolution of today’s megaships with 24,000 TEU capacity. 775 million TEU (twenty-foot equivalent unit) were handled around the world in 2020 and the forecast for 2021 is 827 million.
• SWIRE SHIPPING WILL LAUNCH A NEW Northwest Australia Direct (NWD) Service in June. This will provide direct connections between Singapore and north western Australia. The new service offers two loops. The first will serve Singapore, Darwin and Port Hedland with a transit time of 12 days. The second loop will operate from Singapore to Dampier with a transit time of nine days.
• HAPAG LLOYD AND MAERSK HAVE ANNOUNCED the bi-weekly omission of Port Chalmers and Napier in their Australia – New Zealand via Panama and Oceania/Americas services. This change was introduced in an attempt to improve schedule integrity because of port congestion in New Zealand.
• CONGESTION IN NORTHERN EUROPEAN PORTS as well as inland waterways continued to deteriorate in May with waiting times into Rotterdam almost doubling and exceeding five days. Antwerp’s situation is somewhat better with barges waiting “only” 30 – 35 hours. Export bookings are currently very challenging due to an unprecedented shortage of capacity, very restrictive delivery conditions and temporary storage space unavailable.
• CONTAINER SHIPPING LINES ARE CURRRENTLY ENJOYING HUGE PROFITS thanks to the worldwide shortage of capacity. The largest container shipping line in the world – MAERSK – recorded the best quarter profit in its history with a net profit of USD 2.7b billion for the first quarter of 2021. The profit for the same quarter in 2020 was USD 209 million.
• INSPITE OF MASSIVE PROFITS MOST SHIPPING LINES CONTINUE TO IMPLEMENT HUGE RATE INCREASES and regrettably they’re getting away with it because there simply isn’t enough capacity. For June the average increase into Australia seems to be USD 300.00 per TEU and for July one of the carriers has hinted at a “four-digit increase”! 

AIRFREIGHT NEWS 

ACCORDING TO IATA’S LATEST MARKET ANALYSIS global air cargo volumes reached the highest level in history in March 2021 with a growth of 4.4% over pre-crisis level of March 2019. Total international volumes increased by 4% in the same period while the Asia Pacific Region recorded – 0.3% compared to March 2019. For the first quarter of 2021 total global volumes increased by 5.6% compared to 2019 and +14.1% compared to 2020. Due to Covid passenger revenues of IATA airlines are still very low so that cargo’s contribution to total revenue soared from 10-15% of turnover pre-crisis to 30-35% now. 

AUSTRALIAN PORTS AND AIRPORTS 

• SYDNEY’S PORT BOTANY INCREASED ITS TRADE VOLUMES BY 17% IN APRIL 2021 compared to April 2020. The Port of Melbourne reported an even higher increase of 22.4% for the same period.
• THE CONTRACT FOR A MAJOR UPGRADE OF PORT HEDLAND’S BERTH 3 has recently been awarded. The AUD 20 million investment will ensure that the common user Berth 3 remains a reliable and safe asset. Berth 3 is used primarily for the export of salt and import of fuels and general cargo.
• THE FEDERAL GOVERNMENT IS INVESTING AUD 66 MILLION into the upgrade of the Newcastle airport, widening the runway to accommodate longer-range flight such as B777s and Airbus 330s. This will allow an increase of freight capabilities and create new export destinations for businesses in the Hunter Valley and Central Coast regions. The new Code E status with twice daily international flights expected and increased daily direct domestic flights is also a positive development for the RAAF Base Williamstown.
• VICTORIA INTERNATIONAL CONTAINER TERMINAL HAS ANNOUNCED AN INCREASE of its Infrastructure Surcharge and new VBS (vehicle booking system) charges effective 1 July.
• IN OUR LAST NEWSLETTER WE REPORTED ABOUT MUA INDUSTRIAL ACTION AFFECTING DP WORLD TERMINALS and today we need to inform about intermittent industrial action which impacts on Patrick Terminals in Sydney, Brisbane and Fremantle between 15 May and 17 June. 

AUSTRALIAN CUSTOMS AND QUARANTINE 

• GOOD NEWS! 31 May marked the end of the 2020 / 21 BMSB season which commenced on 1 September 2020. The Department of Agriculture Water and the Environment (DAWE) is currently reviewing the measure for the 2021 / 22 season. Updates will be published in due course.
• CUSTOMS BROKERS ARE CURRENTLY EXPERIENCING SIGNIFICANT DELAYS for Import Document Assessment by DAWE. Waiting times on the phone tend to exceed one hour. Early lodging of complete and accurate documents is strongly recommended.
• THE RECENTLY RELEASED 2021-2022 FEDERAL BUDGET includes some positive items for importers and exporters including AUD 411 million additional funding in support of the biosecurity system. This includes spending aimed at facilitating the import supply chain and reducing the regulatory burden on importers as well as more modern technology. AUD 2 billion are committed to deliver a new intermodal terminal in Melbourne.

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