Weekly Market Updates

Zencargo Market Update: 12th September

Sep 12, 2022

In focus: Do shippers need a strike strategy?

The confirmation of industrial action at Liverpool – responsible for an average of 700,000 TEUs of goods per year – is a striking example of what has been a severely disruptive summer for port staff and teams. 

Coming shortly after strikes at Felixstowe – which is poised for a repeat in time with Liverpool – this year also saw port staff downing tools in Antwerp-Bruges, Rotterdam and South Korea. Meanwhile, rail networks are coming under pressure, with multiple strikes in the UK and the looming threat of a strike on US railroads.

The ongoing disruption, congestion and workload stemming from the pandemic, combined with the rising cost of living has created tensions among transport workers, and it is likely we’ve not seen the last of such activity. In this scenario, shippers will need to consider strikes alongside other risk factors in their planning and strategy.

One potential answer is route diversification, moving agilely between destinations according to risk and cost analysis. Analysing lead time data and inventory levels, shippers could model various route options and find the best, or least-bad, solution. However, this will require access to robust internal and supplier data, as well as working with forwarders who can adapt their routes accordingly.

For anyone struggling with navigating these changing market conditions, we are offering strategy discussions with our Chief Commercial Officer and VP of Ocean who can advise on everything from market trends to supplier negotiation. Book a call now to find out more.

China

Ocean

  • Typhoon Muifa is predicted to hit the ports of Shanghai, Ningbo and Busan on Wednesday, coming on the heels of Typhoon Hinnamnor.
    • Currently, the queue of vessels in the region is still above the 50-day average as the ports recover.
    • Storm Hinnamnor reached Chinese and Japanese coasts over the weekend of 3-4 September, halting operations at the Chinese ports of Yangshan and Ningbo-Zhoushan and closing South Korea’s Busan port.
  • China’s Golden Week will take place from 1st October to 7th October, with disruption kicking in early. 
    • Carriers are issuing blank sailings to cope with the low demand before and after golden week that happens in the first week of October. 
    • MSC has issued nine blank sailings during weeks 37-41.
    •  Maersk has announced four blanked or delayed sailings between September 15th and October 1st.
  • Effective late September 2022, Maersk will temporarily revise the port rotation of the Southern Star-service, which connects Asia to Oceania, by changing the port calls at Napier and Brisbane from weekly to alternating fortnightly.

Air

Central China to USA and Europe 

  • After Typhoon Hinnamor in China, flights are now returning to normal schedules. The impact of Typhoon Muifa is currently not predicted to be serious.
  • Rates from NGB to Europe have remained stable.

North China to USA and Europe 

  • From TSN to Europe, rates have decreased. However, rates have remained the same between TSN and the USA compared to last week. 
    • Airlines are offering competitive rates to increase bookings on their carriers. 
  • Rates have decreased from PEK to Europe and the USA. Space is still tight to both lanes.

South China to USA and Europe 

  • Hong Kong is adding restrictions on e-commerce products, aimed at managing risk on electronics and other dangerous goods. 
  • From SZX to Europe and the USA, rates are stable. 
  • From XMN to Europe rates have decreased but they have remained stable to the US.
USA

Ocean

  • Port congestion has shifted from the west coast to the east – last week, there were 130 containerships waiting for berth space at US ports, with 75% being on the east coast. 
    • This is partly due to shippers moving Asian imports from California in anticipation of delays
    • Savannah had the longest line-up, with 41 vessels awaiting berth space at the port.
    • Shippers are now being more agile on port choice, putting strain on infrastructure management between destinations.
  • U.S. freight railroads have announced they were preparing for a possible strike and service disruption a week before a deadline in protracted labour talks.
Benelux

Ocean

  • At the terminals at Antwerp, labour is at a good level as the summer holiday period is over. Yard utilisation is high but manageable. Reefer plug usage on the quays continues to be high. 
    • The designated area for long dwelling imports has a constant feed with increasing stacks.
  • Low water levels on the River Rhine, a key transport artery into central Germany and Switzerland, are adding to cargo congestion in Rotterdam, Hamburg and Zeebrugge.
  • Effective late September 2022, CMA CGM will launch a new Transatlantic service to connect the Mediterranean to North America East Coast.
  • Yard utilisation at Rotterdam World Gateway (RWG) remains high. Cargo opening time for the acceptance of export cargo is 8 days in advance of vessel ETA and RWG is not accepting empty containers’ delivery until further notice.

Air

  • Liege airport is appealing an environmental ruling that would impose a maximum limit of 50,000 aircraft movements per year for aircraft over 34 tons, and an obligation to reduce aircraft noise by 5% per year from 2024 as well as a noise quota on night flights. 
    • The airport’s own plans aim for 67,000 movements at its peak and no limitations on night flights. 
    • Liege is a major conduit for European e-commerce, which could cause a reduction in capacity and increase in rates.
UK and Rest of Europe

Ocean

  • Despite the Felixstowe strike ending, disruption remains.
    • Waiting times shot up at Felixstowe from 10 hours at the beginning of August, to around the 30-hour mark.
    • The time to revert to normality will depend on how long it takes to process the backlog of empty shoreside containers.
    • Carriers expect disruption to continue until at least mid-September.
  • A strike in Liverpool is confirmed for September 19th until Monday 3rd October.
  • Another Felixstowe strike is also expected and the unions are aiming at targeting the same period as the Liverpool port strike.

Road/Rail

  • Strike action is due to take place on 15th and 17th September and 26th and 27th September. 
    • Two UK trade unions, The Rail, Maritime and Transport (RMT) and the Transport Salaried Staffs Association (TSSA) have called a fresh round of strikes later this month. 
    • Over 40,000 RMT members are expected to take strike action over pay rises not matching the high inflation rate and cost of living.

European Bank Holidays

We anticipate a shortage of availability and the occurrence of delays around the bank holiday periods. Plan ahead and allow extra time for your products to be delivered.

September 15th – Slovakia, Spain*

September 17th – Spain*

September 19th – UK

September 20th – Germany*

September 21st – Malta 

September 22nd – Bulgaria 

September 24th – Austria*

September 27th – Belgium*

September 29th – Czech Republic

 

October 1st – Cyprus

October 3rd – Germany

October 5th – Portugal

October 10th – Austria

October 12th – Spain

October 23rd – Hungary

October 26th – Austria

October 28th – Cyprus, Czech Republic, Greece

October 31st – Germany*, Hungary, Ireland, Slovenia

*Not in all regions

 

The route ahead

The information that is available in the Weekly Market Update comes from a variety of online sources, partners and our own teams. Click below to learn more about how Zencargo can help make your supply chain your competitive advantage.

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