MAY 2023 - SNAPSHOT

• Drewry's composite World Container Index decreased by 4.98% in the past month to $1,685.32 per 40ft container as at 25 May 2023.
• ANL announced 'Temporary Service Suspension' until further notice of A3X service which operates an express loop between China and Australia calling Shanghai, Shekou, Brisbane and Sydney. The service operates 3700 TEU capacity vessels on a 35 day round trip. The suspension is blamed on low market demand with the Consortium suggesting it will continue to review the market condition and bring the service back as soon as the demand improves.
• ANL announce they will be implementing a rate restoration programme from 21st May, 2023 at USD200 per 20' dry/reefer & USD400 per 40' dry/reefer for all shipment from North East Asia to Australia East Coasts
• ONE announce they are dropping per diem fees in response to the US FMC's Ocean Shipping Reform Act of 2022 (OSRA), joining MSC, HMM, Maersk, & OOCL in not charging detention fees to consignees on days a US marine terminal is closed.
• OSRA reforms are still instigating major complaints being lodged with FMC in USA
  • Bed Bath & Beyond claiming $37.65m against OOCL,
  • Samsung lodging a complaint against a Korean carrier,
  • Hapag Lloyd lodging claim against rail operator CSX.
  • CertiFit Inc lodging complaint against Evergreen for only providing capacity for 35% of contracted minimim 1000TEU committment agreed to and pushing remainder to spot rates,
  • ONE and Wan Hai issued FMC fines of combined USD$2.65m
• Shipping Line Q1 Financial Reports show all carriers trending down in Q1 2023 year on year:
  • ONE saw revenue almost halved and EBIT down 77% in Q1 2023 compared to same period last year.
  • HMM Net profit was down 91% (Q1 2022 = USD$2.34bn vs Q1 2023 = USD$0.21bn). HMM commentary suggested that high inflation pressure due to the rising cost of energy and raw material has remained, causing higher interest rates and decreased demand. This downward trend in the global economy is expected to continue with no encouraging sign of restoring consumer confidence in the near term.
  • Cosco saw revenue down 56% in Q1, with their bottom line down 80% on same period last year. Still close to US$1b in profit overall.
  • ZIM saw revenue decrease 63% in Q1 compared to last year, with EBITDA down 85% Q1 year-over-year.
  • Maersk revenue declined by 26% to USD 14.2bn from USD 19.3bn, with EBIT down 68.5% to USD 2.3bn from USD 7.3bn
  • Hapag Lloyd revenue declined by 32%, with EBIT down 60.9% year on year.
• Container vessels have reduced their average speed significantly as demand on freight has dropped after the bustling Covid years for shipping, shows a new analysis from Bimco. The average sailing speed has reduced to 13.8 knots in the first quarter of 2023, down by 4 percent compared to the same period last year. And speed could drop by another 10 percent before 2025, estimates Niels Rasmussen, chief shipping analyst at Bimco. When ships lower their speed, it also causes container capacity to be reduced. In the first quarter of 2023, teu capacity fell by 6 percent compared to last year. During the pandemic, demand for container freight was strong and that made carriers accelerate. According to Bimco, carriers increased the average sailing speed by 4 percent during Covid.
• According to UBS, the shipping industry, representing around 3 percent of global CO2 emissions, will have to pay up to USD 300bn to realize the green energy transition on the way to 2050
• Chinese state-controlled carrier Cosco now has the German government's approval to invest in a 24.9% stake in Hamburg's container terminal, after lengthy political debate in Germany over foreign ownership.
• Containership orders still continuing in unprecedented numbers, with Evergreen releasing a tender for 24 x 16000 TEU Methanol dual fuelled ships. During the last 10 quarters, 8.61m TEU worth of containerships have been contracted globally. During the next five years, 1,048 new container vessels are set to hit water, equivalent to 14.6 percent of the existing fleet.
• CEVA Logistics, a subsidiary of French liner CMA CGM, has entered the car carrier trades, taking four dual-fuel Eastern Pacific ships on 10-year charters. The 7,000 ceu ships are currently under construction at China Merchants Jinling Shipyard (Weihai), with the first vessel expected to be delivered in December and the three subsequent ships coming in 2024.
• Panama Canal imposes shipping restrictions to cope with drought, with carriers announcing weight limits or imposed container fees between USD 300 and USD 500 per box effective June 1 in response to the canal's draft limititation measures which could lead to 40% less cargo on some containerships
• Sailing cancellations between 15 May and 18 June 2023 show 20 sailings will reportedly be cancelled across major shipping lanes, representing a 3% cancellation rate, based on a total of 674 scheduled sailings.
  • This is a marked decrease from the five earlier periods, where 9% of scheduled sailings were cancelled over each period, and down from a high of 21.5% cancelled sailings in January 2023.
  • A 3% cancellation rate is the lowest level observed since the pandemic began and is reflective of the nearing equilibrium between shipping supply and demand.
• Global average vessel delays continued to decrease, now at 5.03 days, down from 5.29 days from prior month and 2.41 days lower year on year.

• Global sea freight schedule reliability increased to 62.6% in March 2023, up 2.4% from February 2023. With congestion less of a concern in 2023, global sea freight schedule reliability of all 14 of the largest carriers vastly improved in comparison to 2022, with Maersk remaining the most reliable in March

           

• Major Acquisitions:
  • CMA CGM & Bollore: CMA CGM have all but sealed the purchase of Bollore Logistics to add to their stable alongside Ceva Logistics. This has however led to attention being drawn to container carriers' special tax conditions leading to an unfair playing field.
  • Nippon Express & Cargo Partners: Finalised on 12th May
• Terminal and Port Update:
  • Patrick terminals
    • Brisbane: Working with minimal delays approx. 0-0.5 day 
    • Fremantle: Working with minimal delays approx. 0-0.5 day
    • Sydney: Working with minimal delays approx. 0-0.5 day
  • DP World Terminals
    • Brisbane: Working with minimal delays approx. 0-0.5 day - severly hampered by equipment and IT outages of late, therefore may see a drop in these number as well as increase in costs due to delays.
    • Fremantle: Working with minimal delays approx. 0-0.5 day
    • Sydney: Working with minimal delays approx. 0-0.5 day
    • Melbourne: Working with minimal delays approx. 0-0.5 day
  • VICT
    • Melbourne: Working with avg. delay of 0.5 day
  • AAT
    • Brisbane: Affected by severe congestion in May as flow-on effect of contamination issues in prior month(s) with vessels queued for up to 15days. Expected to clear by early June.
    • Port Kembla: Affected by severe congestion in May as flow-on effect of contamination issues in prior month(s) with vessels queued for up to 15days. March national container volumes up 1% in March compared to same period last year, improving on the February result in which it was down 19%.
• Container volume (TEUs) in March were up 1% in compared to same period last year. A vast improvement on February result in which it was down 19%. 
• A-UKFTA commences 31st May 2023
• Australia has imposed fresh sanctions against Russia and Russian entities as well as an export ban on machinery and related parts.
• Air Export: So far in Outbound Flights ex AU increased 9.6% (of which widebody increased 6%) so far in Q2. Widebody options still approx 6% lower than pre-Covid levels. China (39%) and Hong Kong (48%) are slowly improving but remain the lowest in terms of recovered flight numbers compared to pre-Covid. Global air freight pricing showed marginal improvements in March, reducing by 4% since February, down to an average rate of US$2.62/kg.
• NineSquared released its 2023 updates to the Landside Port Charges Index with Landside port charges continuing to grow strongly between 2022 and 2023. The main indicator, the Access Charges Index, grew by 18% from 2022-2023. An estimated total of $1.3 billion was spent on access charges in the 2021-2022 financial year alone.

GLOBAL SHIPPERS FORUM (GSF) WORKING GROUPS

INTERNATIONAL SHIPPING LINE UPDATES

• Week 17 (as at 25 April 2023)
• Week 18 (as at 1 May 2023)
• Week 19 (as at 8 May 2023) 
• Week 20 (as at 15 May 2023)
• Week 21 (as at 22 May 2023)
• Week 22 (as at 29 May 2023)

AUSTRALIAN PART X SHIPPING NOTICES