Capacity continues to grow in 2023 despite weak demand

The bulk of new vessel capacity due to enter the market for 2023 is still yet to be delivered. Fuelled by gains made during the pandemic era, carriers invested heavily in new vessel builds, many of which are set to be delivered this year and next, equating to an approximate global #capacity increase of 8% in both 2023 and 2024.

In the current market however, carriers have struggled with overcapacity as demand in Europe and the US has waned and rates have fallen. As a result carriers have been implementing blank sailing programmes to close the gap between supply and demand. Interestingly, the trade lane where these blank sailings are implemented differ depending on the alliance, with some preferring to blank services from Asia to the US and others between Asia and Europe.?

It is expected that blank sailings will rise as more capacity enters the market, some carriers have also been in negotiations with shipyards to delay the delivery of new #vessel orders. As of right now most major carriers have received less than half of their orderbook for 2023, with #MSC with the largest order book, having only received just over 30% of its orderbook of 570,000 TEUs.??

We are delighted to announce we are running a Cost Cutting Workshop this Thursday. We will provide hands on guidance on driving efficiency and cost savings through; Forecasting, Managing Disruption and Inventory Management. Register for free here!

Asia?

China?

Ocean

Chinese port throughput has achieved positive growth between Jan and May 2023.

• Between Jan and May, Chinese ports handled 122 million TEUs, representing a 4.8% increase year-on-year.?
• Mainland Chinese ports dominate throughput figures with six of the top ten ports by volume handled.?
• This volume increase comes at a time when demand in Europe and the UK has been falling, demonstrating the growth in Intra-Asia trade to fuel the continued growth of throughput at Chinese ports.

The Chinese manufacturing PMI (purchasing managers index) which measures overall factory activity has contracted for the third consecutive month.

• For June, the manufacturing PMI stood at 49, a slight increase from 48.8 in May but still below the 50 point threshold which separates contraction and growth.?
• The PMI figures reflect weak global demand and a sluggish post COVID recovery.

Air

Central China to USA and Europe?

From SHA to Europe rates and the US rates have increased.

• Rates have increased due to C-Check’s (circraft compliance checks) and poor weather restricting the amount of available flights.?
• There has also been a large volume of E-commerce products which has contributed to the rise in rates?

From NGB to Europe rates have increased while to the US rates have remained stable.?

• Final rate is offered on a case by case basis.

North China to USA and Europe?

From TSN to Europe and the US, rates have remained stable this week.?

• We recommend booking 1 -2 days prior to the cargo ready date for shipments to Europe.
• We recommend booking 2 -3 days prior to the cargo ready date for shipments to Europe.
• For Europe, the main services on this lane include Air China, Lufthansa and Singapore Airlines. Korean Air and Asiana Airlines can provide freight flights that can offer an earlier estimated time of departure and arrival.?
• For the US,? the main services on this lane include Japan Airlines, All Nippon Airways and Cathay Pacific. Korean Air and Asiana Airlines can provide freight flights that can offer an earlier estimated time of departure and arrival.?

From PEK to Europe and the US rates have decreased this week.

• Special rates can be applied to heavy dense cargo. Please check on a case-by-case basis.?

From TAO to Europe and the US rates have remained stable this week.

From CKG to Europe rates have remained stable while to the US, rates have risen slightly.?

South China to USA and Europe?

From? CAN to Europe and the USA, rates have increased slightly this week.

• This is due to the holiday season increasing the amount of tourists which will restrict air freight availability.?
• All shipments will need to be checked with the carrier for rates on a case-by-case basis.?

From SZX to Europe rates have decreased slightly, while to the US rates have remained stable.

• All shipments will need to be checked with the carrier for rates on a case-by-case basis.?

From XMN to Europe and the US rates have remained stable.

• All shipments will need to be checked with the carrier for rates on a case-by-case basis.?

India?

Ocean

The Port of Mundra is operational but still experiencing delays following Cyclone Biparjo.

• There are currently rail and road delays between the port and inland terminals.?

Latest on LinkedIn

North America

USA?

Ocean

Congestion at US West Coast ports?has eased meanwhile issues have arisen on the East Coast.

• There has been significant congestion at the Norfolk terminal at the Port of Virginia.
• Currently, there are 21 vessels waiting to berth which has been caused by vessel bunching.??
• Vessels are exploring options to divert to neighbouring ports to avoid the congestion.?
• Meanwhile at the Port of Long Beach and LA congestion has eased to 4 vessels waiting to berth down from 12 two weeks ago, which was the highest level in 2023.?

The Port of New York handled 5% more cargo in May 2023 than in May 2019.

• This also represents a 4.3% increase on April figures.?
• This increase compared with pre pandemic levels gives an indication of the volume which has been diverted from West Coast to East Coast US ports.?
• In 2023 the port has so far handled 1.6 million TEU and is the second busiest in terms of loaded imports.?

Europe

Benelux

Ocean

The Port of Rotterdam will undertake a phased expansion of Rotterdam World Gateway (RWG).

• The port, which is the largest in Europe, will invest approximately € 500 million and initially includes civil works, quay cranes, storage modules with automatic stacking cranes and electrical automatic guided vehicles.
• Construction is already underway and it is expected to be commercially operational by 2026.?

UK?

Ocean

There have been calls for more investment in UK ports to pave the way to becoming a global leader in achieving net-zero.

• Paul Olvhoj, Business Development Manager at Orkney Future Ports that investment in UK ports is essential to help support the offshore wind sector.
• Ports across the UK have increasingly been investing in more sustainable technology such as electric forklifts and tugboats which utilise alternative fuels.

Road/Rail

The HGV levy is due to return on the 1st August.

• If you operate HGVs over 12,000kg on a motorway or ‘A’ road you must pay the charge.
• The levy will now be charged based on a? vehicle's weight and emissions.?
• For vehicles registered in the UK the levy will need to be paid annually or biannually.