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The latest news in the logistics industry 07/13/2023

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发布日期: 2023年7月13日

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This newsletter's summary

Figure of the week

+40%

The rise in shipping capacity on the Asia-Europe axis year on year. According to Sea-Intelligence, this incredible leap to North America is 20%.

Sea freight: Transatlantic rates plummet, blank sailings expected everywhere

The shipping industry is at a crossroads. First of all, because there is?no peak season in sight. In the United States, Global Port Tracker estimates that containerized imports will be 8% lower in the third quarter than last year. Secondly, the shipping companies have created a situation of?historic overcapacity, while at the same time engaging in a?price war.

For them, the situation is becoming increasingly worrying: they are currently losing between 500 and 700 USD/FEU on Asia-Europe trades, and no big trade is left to compensate.?Spot rates have collapsed on the Transatlantic: the World Container Index (WCI) fell by 25% last week on the Rotterdam-New York route. Goodbye to the Atlantic miracle, the American engine has stopped.

Not only that, but companies are also facing an increase of around a third in the?cost of managing their vessels, which have been modernized and renewed thanks to the profits accumulated during the recent post-Covid recovery. The race for low rates is probably over.

The GRI (General Rate Increase) announcement in August by Maersk and CMA CGM will no doubt be followed by a?wave of blank sailings, to support this voluntary rate hike and ensure that it doesn't flop, as it did earlier in the year. "More aggressive capacity reductions will be needed to ensure rate stability," concludes Linerlytica.

Decarbonizing maritime transport: IMO's new strategy

Last week, the IMO (International Maritime Organization) unveiled its long-awaited revised 2050 climate strategy. Key points:

Zero net emissions target for shipping "in or around 2050". Previously, the IMO had set a target of -50% by this date;
The intermediate target for reducing CO2 emissions:?between -20 and -30% from 2030, then between -70 and -80% by 2040;
The target for the adoption of?new low-carbon fuels, energies, or propulsion technologies, should represent between 5 and 10% of the energy used by shipping by 2030.

This agreement remains "a starting point for work that must intensify even further in the years and decades to come", said Kitack Lim, Secretary General of the IMO. Indeed, member states have set a timetable for the adoption of medium-term measures, such as a?global fuel standard?or a?carbon tax mechanism, to be implemented in 2027.

Meanwhile, reactions are flooding in. Shipping company representatives voiced their support for the 2023 strategy, while environmental organizations and activists were more critical, arguing in particular that the agreement was not aligned with the objective of limiting global warming to 1.5°C, but to 2°C. Shipping accounts for 3% of global greenhouse gas emissions every year.

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Air freight: Market stabilization confirmed in June, despite regional contrasts

Recent air freight statistics confirm the ongoing stabilization of the market, both in terms of volumes and rates. In June, according to WorldACD, global airfreight tonnages were?4% lower than in June 2022, with the decline slowing month by month from -6% in May and -10% in April.

Worldwide average airfreight rates are also more or less stabilizing, although they are?down 38% compared to last year. As for the Baltic Airfreight Index (BAI), the overall index fell by 49% year-on-year in June. The spot rate between Shanghai and Northern Europe last week stood at?3.04 USD/kg.

A look at regional data nevertheless reveals regional disparities, some of them quite marked. The BAI for exports from Frankfurt, for example, fell by 12.5% month-on-month, while the Outbound Shanghai index held its own at -3.1%. The head of IATA confirmed his optimism that the?market would soon recover. Meanwhile, shippers can benefit from low rates.