Maritime research firm Drewry has highlighted how the Shanghai lockdowns has impacted container shipping in a recent analysis.
Drewry used Automatic identification systems (AIS) data to plot the impact on vessel calls at Shanghai, Ningbo and Qingdao. The calculations show a slow decline initially in the number of vessel calls at Shanghai. “Between the start of the lockdowns in weeks 11 and last week (week 18), the number of weekly port calls in Shanghai trended downwards by 2.5 port calls per week while at Ningbo and Qingdao the number increased by an average of 1.1 and 0.5 per week. There was a significant reduction in Shanghai port calls since mid-April (week 15). The total reduction between week 15 (122 vessel calls) and week 18 (91 vessel calls) was 31, or 26 percent, of which 25 were this last week," reported Drewry.
The Drewry analysis also showed how the eight-week lockdown in China has stored up problems for a global container distribution system “already severely stressed and facing reduced capacity due to pervasive congestion”. An estimated 260,000 TEU of export cargo was not shipped from Shanghai in April because of the lockdown. The analysis notes, “This is the equivalent of 26 fully-loaded 10,000 TEU containerships, which will have to be found somehow in future months, as supply chains are reactivated.”
Given that the summer peak season is normally busier, the analysis concludes that the Shanghai rebound is likely to support a strong peak season and new capacity shortages.
Source: The Maritime Executive
Alliance carriers need to add three ships per loop to sustain weekly frequency and maintain schedule integrity on the Asia-North Europe corridor, Alphaliner analysis showed.
After assessing the completion of round-trip voyages between 1 May and 15 May, Alphaliner noted that ships on Asia-North Europe loops arrived back in China, on average 20 days late compared with their proforma schedules. “Most of the time is lost in North Europe, awaiting an available berth at the major ports,” said Alphaliner. This forces carriers to blank some sailings as there is no ship available.
High yard densities at Northern European container terminals and inland transport bottlenecks are worsening port congestion problems on the trade between Far East and North Europe. The time needed to discharge and load at Europe’s three biggest container ports – Rotterdam, Antwerp and Hamburg, was a total of 36 days between arrival at Rotterdam and departure from Hamburg. Alphaliner said, “Such delays cannot be caught up by sailing Eastbound at full speed.”
Ocean Alliance was closest to schedule reliability, with an average delay of 17 days for its loops. Next was 2M, with an average delay of 19 days. THE Alliance carriers recorded the worst performance, with an average delay of 32 days (see Figure 1). The consultant said THE Alliance carriers’ vessels saw the longest delays because “they rigorously stick to their schedules without skipping any ports”.
A spokesman for one carrier pointed to the lack of port labor and a shortage of haulage which has increased dwell times of import containers in Europe.
“As the big terminals get choked up with boxes, ships have to wait at anchorage,” said Alphaliner. The company warned that surge of Chinese exports after lockdowns are lifted “could add unwanted extra pressure on the North European port and terminal systems again this summer”.
Source: Alphaliner
Alliance carriers need to add three ships per loop to sustain weekly frequency and maintain schedule integrity on the Asia-North Europe corridor, Alphaliner analysis showed.
After assessing the completion of round-trip voyages between 1 May and 15 May, Alphaliner noted that ships on Asia-North Europe loops arrived back in China, on average 20 days late compared with their proforma schedules. “Most of the time is lost in North Europe, awaiting an available berth at the major ports,” said Alphaliner. This forces carriers to blank some sailings as there is no ship available.
According to Alan Murphy, CEO and founder of Sea-Intelligence Maritime Analysis, carriers will skip sailings and forgo weekly schedule integrity to keep utilization and rates elevated. “The second quarter of 2020 saw the sharpest drop in container volumes in the history of liner shipping, but rates held firm through the volume crash as carriers blanked up to 50 percent of sailings in some weeks,” said Murphy. He added that the Trans-Pacific and Asia–Europe markets “will never see $500 freight rates again.”
Sustained demand on major East-West trade lanes, port congestion and equipment shortages have contributed to keeping rate levels elevated. According to rate benchmarking platform Xeneta, spot rates from Asia-U.S. West Coast have doubled y/y, Trans-Atlantic rates from North Europe to North America are up 145% y/y and Asia to North Europe spot rates are 30% above the same time last year despite a -30% decline since January 1. Although carrier executives forecast spot rates to fall through the second half of 2022, several have already locked in long-term contracts at high rate levels.
Source: Journal of Commerce
Canadian West Coast ports are not able to handle U.S. cargo spillover if disruptions are caused by the ongoing longshore contract negotiations. The ports of Vancouver and Prince Rupert are already at capacity with Asian imports destined for U.S. and Canadian markets. Cliff Stewart, vice president of infrastructure at the Port of Vancouver said, “The terminals are full. There’s nowhere to put anything.”
A May 6 advisory from Maersk Line to its customers said the Vancouver Fraser Port Authority is operating at 100% yard utilization and Prince Rupert at 113%. Typically, after a container terminal reaches 80% utilization, there is no buffer to handle cargo surges, and operations deteriorate.
While both ports have intermodal rail service throughout Canada and to the U.S. Midwest via Chicago, the ports of Vancouver and Prince Rupert are still dealing with freight disruption after fires, flooding and sub-freezing temperatures in British Columbia crippled the rail infrastructure in the province.
The Canadian railroad will need to muster all the rail capacity they have to handle what is scheduled to enter the country entering the summer-fall peak season. “We don’t have surplus rail capacity sitting around,” said Jonathan Wahba, vice president/commercial integration at Canadian Pacific.
Source: Journal of Commerce
On May 17, members of the European Parliament (MEPs) voted in favor of amendments to the EU Emissions Trading Scheme (ETS) to include maritime transport. Under the proposal, shipping emissions would be fully covered by the carbon market from 2024, two years earlier than the original proposal by the European Commission, which drafts EU laws.
MEPs want to cover 100% of emissions from intra-European routes as of 2024, 50% of emissions from extra-European routes from and to the EU
MEPs want to cover 100% of emissions from intra-European routes as of 2024, 50% of emissions from extra-European routes from and to the EU from 2024 until end of 2026 and 100% from 2027 onwards under the proposals. Additionally, the type of emissions covered would also expand to include more greenhouse gases.
75% of the revenues generated from the auctioning of maritime allowances would be put into an Ocean Fund to support the transition to an energy efficient and climate resilient EU maritime sector. A bonus-malus system was also proposed from 2025 which would grant additional free allowances to the most efficient performers in a sector. Overall, free allowances would be phased out from 2026 and gone by 2030, five years earlier than proposed previously.
Jacob Armstrong, sustainable shipping officer at Transport & Environment, said: “Shipping's right to pollute for free is finally coming to an end. The ENVI Committee has proposed a climate-ambitious carbon market that works for industry and for the climate. The European Parliament Plenary must now rubber stamp this proposal so that we can start to take advantage of the ETS revenues and begin shipping’s long-delayed voyage towards decarbonization.”
Data from Alphaliner shows that 29% of all liner capacity calls are in Europe, whether on the Trans-Atlantic, Asia-Europe or intra-Europe tradelanes.
The European Parliaments Plenary will still need to consider and vote on the amended ETS proposal in its June 6-9 session, and then go on for negotiation with member states if passed.
Source: Seatrade Maritime News
