News
Industry Update – April 2022
Significant Delays with Quarantine Inspection of Goods
We have seen massive delays with bookings for quarantine inspection of goods and container washes/tailgates etc. which require a quarantine officer to be present.
We will do our absolute best to minimise extensive delays, however, please be aware of an average delay of 5 days for fumigation and a further 5 days minimum for an officer to sign off on any jobs. Specific quarantine inspection bookings are taking up to four weeks before a booking can be gained. The Department of Agriculture, Water and the Environment is aware of the issues and the concerns of industry have been escalated accordingly within the department. Unfortunately, these delays are beyond our control and we have no option but to pass on any charges incurred by carriers and shipping lines due to these delays.
The situation is expected to continue over the coming months with no immediate resolution in sight.
Situation in USA and Canada:
- Port of Long Beach/Los Angeles – Clean Truck Fund (CTF) Surcharge
From 1st April 2022, the ports of Long Beach and Los Angeles have begun implementing a Clean Truck Fund (CTF) fee with the goal of generating funds to encourage the adoption and deployment of clean trucks and achieve a zero-emission drayage trucking fleet by 2035.
All loaded import, export and domestic containers that transit through the terminal gates via trucking including rail cargo moving to or off a nearby rail ramp are subject to this fee. This new surcharge varies from trucker to trucker and will be passed on when received.
- Port Congestion – Limited capacity
There has been some relief from supply chain bottlenecks for the ports of Los Angeles and Long Beach. The number of container ships waiting for berth in Los Angeles/ Long Beach has continued to decline and has fallen by 35% compared to February. However, the queue of waiting ships off other ports countrywide has not decreased.
The number of ships waiting offshore off East and Gulf Coast ports is reaching new highs, and these ports will also see a surge in import volumes over the upcoming months. There is a 60% increase in the number of vessels on the Asia-North America east coast trade lane in the coming months, as carriers try to avoid port congestion on the west coast. This will severely increase pressure on the port infrastructure on the east coast. At Charleston port, the average container dwell time is up 37% year on year, ships are waiting between 5-9 days for berths at the port. The situation is similar in other ports like New York/New Jersey, where high berth and terminal utilisation are expected to continue into the second quarter (Source – American Shipper).
As a result, carriers have stopped quoting ex door and even ex port at the moment to clear the backlogs. In addition, some shipping lines have temporarily adjusted their weekly service to fortnightly between the west coast and Australia/New Zealand due to the congestion in Long Beach. However, the service is anticipated to head back to weekly service by the end of May, as soon as the delays in Long Beach improve.
Situation in Europe:
Congestion at North Europe’s container ports is rising again, which is affecting ocean carriers’ schedule reliability and restricting import and export operations at terminals. Many of the main container terminal hubs are suffering from berthing delays and terminal/landside congestion. Due to severe operational bottlenecks, carriers are omitting different ports or having port rotation across North European ports.
Furthermore, due to the current situation between Ukraine and Russia and shipping lines’ temporary suspension of new bookings and services to/from these regions, European ports continue to experience increasing congestion as shipping lines are diverting cargo currently en route to Ukraine and Russia to nearby ports in Europe.
In the UK, due to major haulage shortages, we are now seeing haulage prices escalating on a week to week basis. The unprecedented situation that the industry is facing has also caused several issues regarding Quay Rent and associated costs including demurrage incurred because of container haulage not being completed within the allotted free time. This is outside of our control, hence any such charges raised by shipping lines will be passed on once received.
Situation in Asia:
- China – COVID-19 lockdowns
China is currently suffering its worst outbreak since the pandemic began. As per our previous update, Shenzhen city was put under a seven-day lockdown since mid-March, factories were closed and operations of all warehouses in Shenzhen were fully suspended. Although the city has resumed normal operations, it could take weeks for cargo flows to recover.
Shanghai went into full lockdown with massive nucleic acid testing and Covid test reports are widely required for almost all public activities. Although the port of Shanghai and Shanghai Pudong airport remain open, most factories and warehouses are forced to shut down and truck drivers cannot cross district lines or go to other cities to move goods, factors which are causing considerable shipping delays and major disruptions to logistics. The lack of trucking service and labour has lowered the port productivity by 30% in the past week. For these reasons, carriers have diverted to nearby ports such as Ningbo which is causing delays, congestion and equipment shortages at that port. Many airlines continue to suspend flights to Pudong airport, logistics companies have to redirect cargo to nearby airports.
In addition, ocean load volumes through the port of Yantian have plunged by 43% since the beginning of March, despite the terminals staying open during the lockdown.
(Source – The Load Star)
Employees Vote Up New Patrick Enterprise Agreement
After two years of negotiation, the new Patrick Terminals Enterprise Agreement has been voted up by employees across all four Patrick terminals. Following was released by Patrick:-
The new deal provides Patrick Terminals with increased operational flexibility to better meet customers’ needs and service the changing supply chain landscape. The new agreement provides Patrick Terminals with the right to recruit at their discretion without restrictive union quotas.
Michael Jovicic, CEO Patrick Terminals said, “We are pleased to have secured support for our new enterprise agreement across our workforce. This new four-year arrangement provides the flexibility that we sought in regard to recruitment and will allow us to better service our customers in regard to manning, new technology and operational efficiency. We would like to thank our customers for their patience over the past 2 years and now look forward to a future of industrial stability on the Patrick waterfront.”
The new Enterprise Agreement will now be lodged with the Fair Work Commission to ratify.
(Source – FTA)
Airfreight Emergency Cartage Fuel Surcharge ex USA:
Further to our previous notice, Emergency Cartage Fuel Surcharge has increased to 22% on top of all airfreight inland pickups in the USA. Please note this surcharge fluctuates continually, so this is subject to change.
Bunker Adjustment Factor (BAF) Increase from USA and Canada to Australia and New Zealand:
All carriers have increased their Bunker Adjustment Factors, effective 01st April 2022, from USA and Canada to Australia and New Zealand. The amount of increase varies from carrier to carrier, the highest being USD 720 per 20GP and USD 1440 per 40GP/HC.
General Rate Increase from Australia and New Zealand to Asia and the Middle East:
One carrier will implement a General Rate Increase on cargo originating from Australia and New Zealand to Asia and the Middle East effective 1st May 2022, as follows:
USD 500 per container
Airfreight – Destination Airline Terminal Fee Increase:
Destination Airline Terminal Fee has increased for all airfreight shipments coming to Australia, effective immediately. The new surcharge will be as follows:
Minimum AUD 65
AUD 0.64 per kg
Fuel Levy Increase in Sydney/Melbourne/Brisbane/Fremantle:
Fuel Levy in Sydney, Melbourne, Brisbane and Fremantle has increased to 25% for all FCL pickups/deliveries, effective immediately.
In Fremantle, Fuel Levy for all LCL and Airfreight pickups/deliveries has also increased to 22%, effective immediately.
Please note this is applicable for pickups and deliveries within metro areas only and is subject to change – fuel surcharge for regional and interstate areas will be higher and will vary depending on location.
D & V have tried to keep the increase to a minimum and will continue to monitor the terminal gate price so we adjust the rate accordingly as the current situation is constantly changing.
Adelaide Port Infrastructure Increase:
Adelaide Port Infrastructure surcharge has increased slightly, effective immediately. The updated Port Infrastructure fee in Adelaide will be AUD 130 per container.
Melbourne Time Slot Booking Fee Increase:
We have seen further increases in Time Slot Booking Fees in Melbourne. These increases are implemented by the terminals, which we do not have any control over and therefore have no option but to pass on. The updated Time Slot Booking Fee in Melbourne has been increased to AUD 80 per container, effective immediately.
Brisbane Empty Container Park Increase:
Brisbane Empty Container Park surcharge will increase to AUD 95 per container, effective 25th April 2022.
We will keep you updated with any further information.
