Fracht Australia News - May 2021
3/5/2021
AROUND THE WORLD
- JAPAN: The Golden Week holidays will be from 29 April until 5 May. Some companies will also remain closed on 6 or 7 May.
- OMAN: A new VAT system was implemented on 16 April. The standard rate of 5% is payable on most goods except essential food items, medical care, education and financial services.
- RAMADAN: The holy month of Ramadan in Muslim countries is due to end on 12 May and Eid-al-Fitr holidays are expected to commence on 13 May. In most countries the official holidays are three days but in some places this is extended up to one week. All companies and most public services will remain closed during this holiday.
- SUEZ CANAL: The Suez Canal Authority has formally arrested the vessel “Ever Given” following the six day closure of the canal. The SCA lodged a USD 916 million compensation claim against the Japanese vessel owner, Shoe Kisen. This includes USD 300 million for salvage and USD 300 million for “loss of reputation”. The canal blockage has led to a cumulative delay to shipping fleets of 1,072 days. The shipping line has declared a General Average based on the principle that all the interests in the ship’s voyage (the cargo owners) should contribute to the sacrifice and expenditures incurred for the benefit of all interests in the safe continuance of the voyage. This arrest is likely to further delay the General Average process and the release of the cargo. The canal blockage will further decrease the very low schedule reliability as due to the bunching of vessels arriving in already congested ports such as Singapore, Port Klang, Rotterdam or New York.
SEAFREIGHT NEWS
- MSC IS SET TO BECOME THE WORLD’S LARGEST CONTAINER SHIPPING LINE based on its ship order books and aggressive purchasing in the second-hand market. The current number 1, Denmark based Maersk operates a fleet of 4,121,964 TEUs (twenty foot equivalent units) and the Swiss competitor MSC’s capacity is 3,897,002 TEUs. MSC is behind orders for at least 35 large deep-sea vessels with a capacity of 660,000 TEU while Maersk’s order book includes only 16 regional vessels for 41,474 TEU. Sometime in 2022 MSC is expected to take the top spot.
- ZIM LINE LAUNCHED A NEW TRANS TASMAN SERVICE on 2 April using two 1,100-TEU vessels. The rotation is Melbourne – Sydney – Auckland – Tauranga – Melbourne.
- CMA CGM ANNOUNCED THE REORGANISATION OF ITS AS6 SERVICE as an individual loop, adding Pipavav and Colombo calls Eastbound. The new rotation is Shanghai – Ningbo – Shekou – Nansha – Singapore – Port Klang – Nhava Sheva – Pipavav – Karachi – Colombo - Singapore – Hong Kong – Shanghai. There will be enhanced connections from Colombo to Central China.
- HAPAG LLOYD LAUNCHED ITS NEW ASIA – EAST AFRICA SERVICE IN APRIL. The East Africa Service 3 (EAS3) will be operated with seven 2,800 TEU vessels with the following rotation: Shanghai – Ningbo – Nansha – Singapore – Port Klang – Mombasa – Dar Es Salaam – Port Klang – Singapore – Shanghai.
- CONTAINER FREIGHT RATES AROUND THE WORLD CONTINUE TO INCREASE TO UNPRECEDENTED HIGH LEVELS while available equipment and space capacity in most ports remains very low. New surcharges are announced almost weekly. All major shipping lines are reporting very healthy profits.
AIRFREIGHT NEWS
- CATHAY PACIFIC HAS REGAINED ITS FULL CARGO CAPACITY following the easing of Hong Kong’s crew quarantine measures. In February Hong Kong imposed a 14-day quarantine for locally based crew, forcing Cathay to cut 25% of its cargo capacity and increasing monthly cash burn by some 50 million USD.
- ACCORDING TO THE LATEST IATA STATISTICS the worldwide air cargo market continued to expand strong in February and overall volume rose by 9% compared to February 2019. The comparative figures are reported for 2019 because the 2020 numbers would be distorted due to COVID. Year to date up to February international airfreight increased by 10.4% while the Asia Pacific Region gained 8.2%. Around the world airfreight rates remain at extremely high levels because demand continues to outstrip available capacity.
- IATA ALSO REPORTS THAT NET AIRLINE LOSSES OF USD 47.7 BILLION are expected in 2021 (a net profit margin of -10.4%). This is an improvement on the estimated net industry loss of USD 126.4 billion in 2020 (net profit margin of -33.9%). These losses imply a cash burn of USD 81 billion in 2021 on top of the 149 billion in 2020. The industry’s debt burden has ballooned by USD 220 billion to USD 651 billion.
AUSTRALIAN PORTS
- SYDNEY’S PORT BOTANY WELCOMED THE LONGEST CONTAINERSHIP to ever visit the DP World terminal on 29 March. The 346.9 metre long 9,578 TEU capacity “Soroe Maersk” was deployed to Sydney to pick up 3,756 empty containers. From Sydney the vessel continued to Melbourne to evacuate more empty containers before returning to Vietnam, China and Hong Kong.
- WHILE IT WAS RELATIVELY QUIET RECENTLY ON THE WATERFRONT, we continue to see industrial action in our ports. DP World at Port Botany was hit with work stoppages on 30 March and the MUA (Maritime Union of Australia) sent a formal notice to VICT (Victoria International Container Terminal) Melbourne announcing work stoppages on 1 and 3 May. Sadly such interruptions come at a very high price for the Australian Economy.
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
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