Zencargo Market Update: 22nd August

China

Ocean

• The Yangtze river, the world’s third largest river, has reached record-low levels.
  • The river is used as a route to connect inland and coastal ports together and reported a throughput of 2.02 billion tonnes of cargo in the first seven months of this year.
  • The waterflow on the river’s main trunk is more than 50% below the average of the last 5 years.
  • Shipping routes in the middle and lower sections of the river have closed, disrupting cargo traffic. 
• Last week, Sichuan limited power supply to thousands of factories and rationed public electricity usage. 
  • As temperatures soared in the province, there has been an increase in demand for air conditioning. 
  • Simultaneously, the region relies on dams to generate 80% of its electricity but rivers have dried up in the area due to drought. 
  • This has affected global supply chains as the region produces half of the nation’s lithium used in batteries for electric vehicles. 
  • The power rationing has been extended to at least Thursday this week.

Air

Central China to USA and Europe 

• Due to power restrictions in the western region of China, some factories have been unable to operate as normal. Although flights have been cancelled, capacity is high on carriers. 
• Rates from SHA to Europe and the USA have decreased last week; however, once power restrictions in the Western region are lifted, it is expected that rates will increase. 
• Rates from NGB to Europe have decreased but have remained the same to the US.

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. 
• Space is not as tight in August from TSN and airlines are offering competitive rates to attract more bookings. 
• Rates have decreased from PEK to Europe and the USA. Space is still tight to both lanes. 
  • Hot weather conditions and rain remain a challenge for carriers as flights have been cancelled and rescheduled, affecting flight schedules. 

South China to USA and Europe 

• From CAN to Europe and the USA, rates have decreased to both destinations as the market is quieter. 
• From SZX to Europe and the USA, rates are stable. 
• From XMN to Europe rates have decreased but have remained stable to the USA. 

USA

Ocean

• Inbound volumes continue to grow strongly at around 11% on the US East Coast in Q2, 2022. 
  • There is an indication that volumes continue to shift from the West to the East Coast. 
  • Sea Intelligence has shown that the total import ratio between the US West Coast and US East Coast continues to fall and has dropped to 1.04 over the last few months. 
  • This means that the total handling volumes on both coasts are nearly the same whereas historically, the US West Coast has handled more volumes compared to the East Coast.

Germany

Ocean

• The Port of Hamburg has recorded a growing volume throughput at the first half of this year.
  • Despite the impact of EU sanctions on Russian trade and a decline in UK volumes from Brexit, throughput increased year-on-year by 0.9% to 4.4m TEU. This is a contrast with the 4.4% decrease at the Port of Antwerp-Bruges and the 6.2% fall at the Port of Rotterdam. 
  • The reason for this increase is the year-on-year 5.8% increase in Chinese imports and exports and the 3.9% increase in US volumes. 
  • The completion of the navigation channel in the River Elbe in January also boosted vessel utilisation of ultra-large container vessels. This enabled more handling of containers as ULCVs were able to enter and leave the port with greater ease. 

Benelux

Ocean

• At the terminals at Antwerp, labour is at a sufficient level. Yard utilisation is high but manageable.
• The Port of Rotterdam is still experiencing reduced labour availability due to the ongoing summer holiday period. 
  • At the Europe Container Terminals, there is an improvement in long dwell times in transhipment and import cargo. 
  • Off yard storage is still fully utilised due to storing customs blocked Russian cargo and long stay imports. 

UK and Rest of Europe

Road/Rail

• The UK Government has revealed that 74% more lorry driver tests were carried out between January and March 2022 compared to pre-pandemic levels. 
  • 11,197 more lorry driving tests were carried out between 1st January 2022 and 31st march 2022 compared to the same period in 2020. 
  • The Road Haulage Association has reported a shortage of 100,000 HGV drivers. 
  • To help solve this shortage, the government simplified the process to becoming a HGV driver in 2021.
  • The sector is beginning to see improvements in the industry as the number of HGV drivers is starting to stabilise. 

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.

August 29th – Slovakia

September 1st – Slovakia

September 2nd – Spain*

September 5th – Luxembourg*

September 6th – Bulgaria, Spain*

September 8th – Malta, Spain*

September 15th – Slovakia, Spain*

September 17th – Spain*

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