News

Fracht Australia News - October 2021

1/10/2021

AROUND THE WORLD

• BRAZIL - After being a part of the Fracht Group for many years Nuno Ferreira Cargas Internacionais Ltda has changed its name to NUNO FRACHT CONSULTORIA LOGISTICA E ADUANEIRA LTDA on 13 September 2021.  This coincides with the move of Nuno Fracht into its new Brazilian head office at Rua Avanhandava 126, 4^th Floor, Edificio Cambul, CEP 01306-901 Bairro Bela Vista, Sao Paulo – SP / Brasil.
• CHINA - China’s official National Day Holidays will be from 30 September until 7 October. The city of Xiamen was placed under a full Covid lockdown on 20 September affecting port, terminal and depot operations as well as trucking. All airlines, trains, trucks and cars have been stopped and people commenced working from home.
• GERMANY - The German Train Drivers’ Union launched its third strike in less than a month in early September. The five-day strike affected around 70 per cent of all rail movements and added to the problems and delays in Northern European marine terminals due to labour shortages and port congestions. This further increases the challenges for shipping lines to maintain regular schedules and frequencies.
• INDIA - Merchandise exports continued to bounce back and in August India’s exports increased by 45.8 per cent year-on-year which resulted in fierce competition for container space and skyrocketing freight rates. Exporters are suffering because vessels are overbooked especially to Africa, Oceania and North and South America. Even bookings on premium rates are getting rejected.
• USA - According to Alphaliner throughput at Los Angeles-Long Beach was up 41 per cent on the first half of 2020 reaching 10.18 million TEU (twenty-foot equivalent unit). The west coast gateway has now overtaken Hong Kong to become the world’s ninth largest container port. The second largest US port, New York-New Jersey saw a 31 per cent increase in the first half year reaching 4.39 million TEU. These increased volumes are one of the main contributors to the ongoing massive delays and problems in most US ports and terminals. Vessels awaiting berths in Los Angeles increased to +60 in September resulting in delays of up to three weeks. In New York, berthing delays were running upward of seven days. Most other US ports are experiencing similar delays. There is currently an unprecedented demand for chassis throughout the USA resulting in chassis deficits in most pools around the USA. Container dwelling times in rail ramps and terminals around the country range for four to 16 days! 

SEAFREIGHT NEWS

• THE DREWRY WORLD CONTAINER INDEX REPORT ON 20 September revealed the 22^nd consecutive week of increases. The average composite index of the WCI year to date stood at USD 6,794 per 40 ft container which is USD 4,432 higher than the five year average. In 2019 the average 40 ft was well below USD 2,000.00.
• THE TAIWANESE CARRIER TS LINES IS CONTEMPLATING THE LAUNCH OF A NEW US WEST COAST SERVICE TO NEW ZEALAND once the current massive congestion in the US and New Zealand ports has improved. The much needed capacity boost would be good news for New Zealand importers and exporters. TS lines have recently announced a slew of new building orders.
• CMA CGM AND HAPAG LLOYD HAVE ANNOUNCED A CAP ON SPOT RATES as carriers come under increasing pressure from shippers and regulators in a market that has seen making record profits. Shippers and freight forwarders around the world reacted with cynicism and little enthusiasm given that the consensus is the rates have increased to totally unjustifiable levels and assuming that the various extremely high surcharges will continue.
• MAERSK UPGRADED ITS 2021 FULL YEAR EBIT BY USD 4 – 4.5 BILLION after reporting the Q3 profits are significantly higher than expected. Q3 earnings are likely to reach USD 6 billion which compares with an ebit of 7.2 billion for the first six months of the year.

 

AIRFREIGHT NEWS

According to the latest IATA statistics worldwide airfreight volumes increased by 7.7% in August 2021 compared to 2019. Year to date for the first eight months of the year international volumes increased by 8.3% in 2021 compared to 2019 and the Asia Pacific carriers achieved an increase of 3.6%. The Asia Pacific region had the highest cargo load factor in the world due to the fact that the overall available capacity in our region is still well below 2019 levels.

 

AUSTRALIAN PORTS

• UNFORTUNATELY INDUSTRIAL ACTION BY THE MUA AGAINST PATRICK TERMINALS in Sydney, Melbourne, Brisbane and Fremantle will continue well into October posing a threat to cripple Christmas business. On 30 September Patrick reported that the MUA launched in excess of 200 industrial actions since May 2021. Vessel delays in the terminals in Sydney and Melbourne are expected to reach seven days in October and again importers and exporters will have to pay for congestion surcharges and other additional costs caused by vessels omitting ports or changing schedules. In the last quarter of 2020 shipping lines imposed congestion surcharges in excess of AUD 330 million related to Port Botany.  Patrick advises that they have been unable to reach a deal with the MUA despite their offer of a 2.5 per cent year on year pay increase for four years, guaranteed job security, commitment to preserving jobs and caps on casual labour. The current average pay, inclusive bonuses and overtime before the pay increase based on a 35-hour week is AUD 869 per day in Sydney, AUD 932 in Melbourne, AUD 890 in Brisbane and AUD 920 in Fremantle. The Peak industry body Shipping Australia published an update on 24 September stating that: Given the central and vital importance of freight, shipping and ports, it is fair to say union-led disruption to their activities will adversely impact the lives of everyday Australians. It can really cause a lot of problems to large numbers of people who are not involved in the dispute. It’s a mess.
• THREE TERMINALS EXPERIENCED DISRUPTIONS IN SEPTEMBER DUE TO EMPLOYEES RETURNING POSITIVE COVID-TESTS: These were Victoria International Container Terminal in Melbourne, Hutchinson Port Sydney and DP World Port Botany.
• The MUA took industrial action against Svitzer’s tug operations in Brisbane and far north Queensland between 13 and 17 September.
• SYDNEY’S PORT BOTANY REPORTED A 3.61 PER CENT DIP IN TRADE FIGURES in August. Only 220,850 TEU were handled compared to 229,118 TEU in August 2020. 

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