07.08.2020
Space availability
We are entering a critical time in the coming 2 months, with space availability potentially being the worst it hase been since 2010.
In July, as demand increased, there were questions over whether this could be sustained into August. We now know that not only is the demand being sustained, it even continues to surge.
Space is critical in all areas and there are no space guarantees for the moment.
06.08.2020
Equipment Shortages at China Ports
Nearly all carriers are experiencing equipment shortages at major China ports due to a recent surge in cargo.
Shipments from Yantian where the empty is picked up in Shekou, truckers are incurring extended transit times and waiting times at the depots totaling 4 - 5 hours due to lack of equipment. Due to the extended times, some truckers are charging additional fees per container for these pickups.
12.05.2020
Global Container Shipping and the Coronavirus Crisis
Global Container trade volumes declined by 8.6% in February 2020 compared to the same month of 2019. Official figures for March 2020 have not been released, but in view of widespread lockdowns the reduction will likely be larger. The decline in container trade was particularly marked in the Far East. In Europe, North America and Oceania it is also significant, while it is not yet noticeable in other emerging economies (Latin America, Sub-Saharan Africa and the Indian Subcontinent and the Middle East). The table below lists the changes in January and February 2020 for different world regions.
The main response of carriers to falling demand has been to reduce supply. Ship operators have massively started to idle vessels by cancelling services. These blank sailings have increased significantly compared to previous years, with 188 in February / March 2020, of which 85 were on the Asia - North America West Coast tradelane and 49 on the Asia - North Europe tradelane.
More cancellations have been announced. They concern up to 30% of the Far East - Europe service capacity and up to 20% of the Trans - Pacific service capacity in coming weeks. The share of idle container ship capacity reached 2.5 million Twenty-foot Equivalent Units (TEU) of 10.6% of capacity in early March 2020.
Carriers will continue to look for ways to reduce costs. In 2015, carriers re-routed traffic after the opening of the new Suez Canal, forcing the Canal Authority to cut rates by 65%. Now, some are again re-routing Asia - Europe services via the Cape of Good Hope to avoid Suez Canal charges, a course of action made viable by very low oil prices.
The current oversupply of vessels could become even more problematic. Container ship supply is set to increase 5% in 2020 and 3% in 2021, based on the current ship order book. Demand for container freight, however, could fall by 10% to 30% depending on the assumptions.
If global container trade volumes were to contract by 11% in 2020 (in line with International Monetary Fund (IMF) projections of an 11% contraction of global trade), even an all-time high container ship idling rate of 15% would not be able to bridge the gap with the reduction of demand.
Some shipyards are already slashing prices to preserve their order book. Similar price reductions during the post-2008 crisis contributed to a race to build mega-ships. Government support for the maritime sector seems also intended to keep local shipbuilding industries in business.
Over the past decade, carriers mitigated excess capacity by lowering ship speeds, scrapping older vessels and cancelling orders for new ships. Carriers will likely resort to a mix of similar instruments in the second and third quarter of 2020.
27.04.2020
As a result of COVID-19, we have seen a big increase in the demand for hand sanitizer from many of our customers.
Due to the high alcohol content needed to make hand sanitizers, it needs to be shipped as Dangerous cargo. In general, they are Class 3 Flammable Liquids, but depending on the exact production they could be classified as either Ethanol Solutions, UN 1170 (if Ethanol is the only alcohol used) or Alcohols, N.O.S., UN 1987 (if multiple alcohols are used). Some hand sanitizers also contain Isopropyl Alcohol (UN 1219) instead of Ethanol (UN 1170); some contain both.
