Zencargo Market Update: 31st August

China

Ocean

• Rain across China has eased the drought which has affected the river water levels in the country. 
  • Last week, we reported that the Yangtze River in China reached record-low water levels which affected cargo traffic as shipping routes in the middle and lower sections of the river closed. 
  • The government also imposed energy restrictions in the province of Sichuan as the region relies on dams to generate 80% of its electricity but the drought caused rivers to dry up, affecting the supply of electricity. 
  • The rain should bring relief to the region and ease the rationing of electricity.
  • However, experts have noted that it is likely another power crunch will happen over the coming winter as demand for electricity may overwhelm the region’s power grids.

Air

Central China to USA and Europe 

• Rates from SHA to Europe and the USA have remained the same compared to last week. There has not been much change in bookings compared to last week.
• Rates from NGB to Europe and the USA have also remained the same compared to last week. 

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 starting to offer competitive freights to increase bookings on their carriers. 
• Rates have decreased from PEK to Europe and the USA. Space is still tight to both lanes. 
  • Hot weather conditions and rain remain an issue, causing flights to be cancelled and rescheduled.

South China to USA and Europe 

• From CAN to the USA, rates have decreased as the market is quieter. From CAN to the USA, the market is cold so please check with your carrier on a case-by-case basis. 
• 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

• US East and Gulf Coast ports continue to see congestion.
  • According to MarineTraffic data, the Port of Savannah has 39 vessels at anchor. At the Port of Houston, there are 22 vessels at anchor. 
  • In their August update, Maersk has reported that vessel wait times are running 1-3 weeks in Newark PNCT, 1-3 days at APM Terminals Elizabeth, 2-18 days for Houston down in the Gulf, and 10-17 days in Savannah. 
  • To avoid the disruption, carriers are adjusting their services by avoiding heavily congested terminals and booking alternative locations.

Germany

Ocean

• Water levels in the River Rhine are set to fall again. 
  • The reference water level was at 1.04 metres at Kaub, an increase of 7 centimetres on the day. 
  • Vessels need water levels at Kaub to be 1.5 metres in order to be fully loaded. 
  • Experts have said that the weather forecast will be quite dry over the coming days and water levels are expected to fall again. Low water levels are likely to continue into September. 
  • The Rhine River is a major shipping route for commodities such as grains and fuel. Disruption on this waterway will cause delays and impact supply chains for Central and Eastern Europe.

• Germany’s port workers and the association representing the seaport operators have agreed to terms for a new contract.
  • This comes after one of the longest running labour disputes in decades
  • The union, which represents 12,000 workers including the major ports of Hamburg, Bremerhaven and Wilhelmshaven, have said that they are recommending that members accept the agreement which will be finalised on 5th September. 
  • The agreement took 10 rounds of negotiations and wage increases have now been set depending on the positions of the workers. 
    • Workers in container operations will on average receive a 9.4% increase which includes bonuses.
    • Workers in general cargo operations will receive a 7.9% increase in their wage. 
    • And effective from 1st June 2023, all workers receive a 4.4% increase that could be extended to 5.5% based on inflation levels next year. 

Benelux

Ocean

• At the terminals at Antwerp, labour is at a sufficient level. Yard utilisation is high but manageable. Reefer plug usage on the quays continues to be high but it is still manageable. 
• The Port of Rotterdam is experiencing faster turnaround of vessels as labour has increased to the end of the school holidays.

UK and Rest of Europe

Ocean

• Last week, dockworkers at the Port of Felixstowe went on an eight-day strike due to failed pay negotiations. 
  • The Unite union has warned that further strike action could carry on through to Christmas unless pay terms are accepted by the employers, Hutchison Ports. 
  • This will bring further impact to supply chains, especially during the peak holiday season where retailers rely on more imports during this period. 

Road/Rail

• UK HGV registrations increased by 0.4% in the second quarter of 2022 to 9,533 trucks. 
  • However, registration levels are still down by 0.1% compared to 2021 in the same period and by 29.5% compared to pre-pandemic levels in 2019. 
  • Despite demand from UK hauliers, the global shortage of semiconductors and raw materials such as steel and aluminium continue to restrict manufacturing capacity. 
• The deadline to switch to Customs Declaration Service (CDS) for import declarations is just a month away. 
  • Businesses must submit their import declarations through the CDS system instead of the legacy system CHIEF.
  • HMRC is reaching out to all declarants and traders who will be affected by the change to remind them about the deadline.

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