News
Industry Update – June 2024
Attention: Shipping Manager
FTA and the Australian Peak Shippers Association prepared a recent report, giving a snapshot of what was happening in May 2024 globally in relation to rates, excerpt below:-
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- Drewry’s composite World Container Index (WCI) has increased significantly in the past month, up 50.5% to $4,072.00 per 40ft container as at 23 May 2024.
- Rate levels are up 142% when compared with the same period last year.
- The average composite index for the year-to-date is $3,280 per 40ft container, which is $559 higher than the 10-year average rate of $2,717 (which was inflated by the exceptional 2020-22 Covid period).
- Rates have started to show signs of stabilising over past few weeks with a slowing rate of decline overall. The slowing largely due to rates ex China starting to increase to certain markets (including Australia).
Situation in USA
- End of Panama’s dry season in sight
The end of Panama’s dry season is in sight and the Panama Canal Authority (ACP) plans to welcome more vessels in the coming weeks. Over six months since the Panama Canal’s reservoir system suffered from the driest October in at least 73 years, the ACP finally sees a path to normalizing operations. The ACP recently increased the number of daily transits to 31 and from 1st June, this number is expected to rise to 32. This adjustment means the canal will be functioning at approximately 90% of its full capacity. Furthermore, the ACP anticipates that the canal will resume full operational capacity by early 2025.
(Source: FTA)
- Baltimore refloats and moves MV Dali, with services set to resume
The containership Dali that has been blocking the port of Baltimore for two months, has been refloated while shipping liners have reopened service bookings. Bookings for transatlantic services and Baltimore exports have not yet reopened. During a briefing on May 21, the U.S. Coast Guard reported that it expects to restore 24-hour access to the port as the effort continues on track to reach the goal of fully reopening the federal channel by the end of May.
(Source: Loadstar)
Red Sea Crisis
Unfortunately, we are still seeing ongoing issues here, with a vessel attacked in the Red Sea over the weekend. Containerships are still making transits on the Suez/Bab-el-Mandeb despite heightened risks following the collapse of ceasefire talks between Israel and Hamas and the escalation of the Houthi attacks on commercial shipping on the Red Sea, which has widened to the Indian Ocean. Over 90 transits have been recorded since 1 April 2024, mainly by smaller carriers operating in the Asia-Med and Baltic Sea routes, compared to over 700 voyages diverted to the Cape route in the same period.
(Source: FTA)
Situation in Asia
- Container Shortages in China
Container shortages and congestion are getting worse in China, with reports suggesting long term freight contracts cannot get containers from carriers due to low rates. India’s freight rate is also currently sitting higher than Australia based on Chinese sources.
(Source: FTA)
- Delays in transhipments from the Port of Singapore
We are noticing a significant delay with containers transiting through Singapore at the moment. Due to severe congestion at the port, containers are sitting there for extended periods of time before being allocated onto a vessel to their final destination.
- More checks and delays at Nhava Sheva after seizure of goods
A recent seizure of laden import containers by customs at Nhava Sheva Port is expected to lead to tightened cargo inspections and releases across Indian ports. Nhava Sheva handles a significant portion of India’s containerised trade and is the second busiest gateway, after Mundra Port. “Our members and their drivers are facing severe issues due to the vehicles being stranded for more than 24 hours in many cases,” said Nhava Sheva Container Operators’ Welfare Association.
(Source: Loadstar)
Situation in Canada
- Strike threat to Canada’s border control and rail network
Chances of disruption to cargo flows in and out of Canada went up a notch when customs and immigration agents voted to strike over their contract negotiations with the Canada Border Services Agency (CBSA). The proposal was supported by 96% of the Border Services group of the Public Service Alliance of Canada (PSAC), and the union noted its members had been without a contract for more than two years. For Canadian cargo owners and logistics providers, this is another potential headache on top of the threat of a shutdown of the national rail network in a dispute between staff and the two Canadian Class I rail carriers.
(Source: Loadstar)
General Rate Increase from North East Asia to Australia:
We received notifications this month from some shipping lines in regards to a General Rate Increase from North East Asia to Australia, details as follows:
The first GRI will come into effect from 1st June 2024:
USD 300/20’
USD 600/40’
LCL will increase accordingly.
In addition to the first GRI, shipping lines will have a second GRI effective from 15th June 2024.
USD 300/20’
USD 600/40’
LCL will increase accordingly.
Expectations are that some carriers are already planning to put in another GRI of USD300-400/TEU effective from 1st July.
General Rate Increase from South East Asia to Australia:
We received notifications this month from some shipping lines in regards to a General Rate Increase from South East Asia to Australia, details as follows:
The first GRI will come into effect from 1st June 2024:
USD 100/20’
USD 200/40’
LCL will increase accordingly.
In addition to the first GRI, shipping lines will have a second GRI effective from 15th June 2024.
USD 100/20’
USD 200/40’
LCL will increase accordingly.
Fremantle Destination Sideloader Levy Fee Increase:
Destination Sideloader Levy Fee in Fremantle has increased to AUD 120 per container, effective immediately.
We will keep you updated with further information.
