Welcome to This Month's Edition of the Orbit Logistics Newsletter
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DECEMBER 2020 NEWSLETTER DECEMBER 2020 Edition - Orbit Newsletter Welcome to this month's edition of the Orbit Logistics Newsletter. Dear Valued Partner Unfortunately there is still no respite with supply chain costs. If I could remind you to pay attention to your f!.fil!Y. WEB/rack report for any changes to the arrival of your orders and shipments. Rates ex China, South East & North East Asia continue to rise with the rush into Chinese New Year. Equipment. still poses difficulties from some NRPC Chinese Ports with a global imbalance. In some instances we continue to work with you and your suppliers to ship using 20GP, NOR and/or 40GP contain• in advance to secure space and your container shipping requirements to minimise disruption to your supply chain. Be assured when rates fall we will immediately reflect these in our pricing. We continue to work at all levels of the Supply Chain and will continue to keep you Informed during these challenging times. Orbit Logistics is ready and able to assist with any concerns you may have. As always, there are a number of interesting articles in this month"s newsletter, but I do urge in particular to ensure all documentation for Customs Clearance is submitted as soon as possible. Its important tt documentation and please have your office forward documents should you be on leave over this period. From a personal view I cant thank you enough for your great support during what has been a very trying 2020. Like all of us we hope that in 2021 we can get back to normality and continue to be able to see our loved ones with no restrictions. Our big Christmas and New Years wish is that freight rates and transit times/sailings return to pre COVID levels. If you would like to discuss any matters please don't hesitate to reach out personally via my mobile or email. Thanks again for your great support, its appreciated by everyone at Orbit Logistics. Best Regards Glenn Allison Managing Director Orbit Logistics Ply Ltd SB Catalina Drive PO Box 728 Tullamarine. VIC 3043 P: +61 3 9330 26251 F: +61 3 9330 2468 M: +61 404 444 447 E: [email protected] https://mailchi.mp/orbitlogistics/september-newsletter-4694823?e=[UNIQID] 1/1• DECEMBER 2020 NEWSLETTER Service Update -Australian/ New Zealand Ports ShiP.R!ng Line - Auckland Port Congestion Surcharg!t Please find an updated congestion surcharge overview with the addition of carriers now implementing surcharges to and from the port of Auckland, New Zealand. As we move into peak season with volume this will be a widespread issue that will affect global trade across various ports. MSC will soon announce similar surcharges to European ports on exports from Australia to the UK. This new Auckland congestion surcharge will also affect LCL shipments to and from Auckland into Australia and will be levied at a quantum of approx. US$15.00 per w/m. We are already seeing some co-lo, h!!P.s://mcusercontent com/25e61fe67092e98abe3c123aa/files/8a7a9d05-8126-449e-82e5-02e7b91 bb5da/PORT CONGESTION SURCHARGE AUCKLAND docx Australian Port/ Terminal Situation As highlighted recently by one of our transport providers there has been a misconception that the port activity is or should be back to normal, which is unfortunately not the case. There have been various lac ongoing Industrial Action across Patricks, DP Wortd and Hutchison ports. We now are in the midst of Industrial Action being taken by the Tug Boat operator Svitzer, plus ongoing challenges with empty conta system hack coupled with recent public holidays (specific to Melbourne) and continued severe weather conditions (Sydney & Brisbane), resulting in a gridlock within the Port Precincts, significant congestion As we mentioned in previous updates, the Port Botany industrial action and port congestion crisis continues to see a significant increase of vessels into Melbourne. We continue to strongly recommend all cu local destination dwell times and supply chain, ensuring all new orders are placed as early possible. Excessive volumes are forecasted over the next few weeks, with some saying they will triple the normal volumes we have seen through the ports, compounded by vessel bunching primarily into Sydney and peak season spike which will likely see delays with delivering containers on time and more importantly delays de-hiring empty containers. Southbound ex. ASIA Extreme vessel delays due to external factors beyond everyone's control are reaping havoc. Some of which include and are not limited to extreme weather conditions/ increased COVID-19 protocols for shii have delayed vessels until the crew can be replaced, a recent issue in Singapore - COSCO ANTWERP), berthing congestion, industrial action now on tug boats plus a host of others that we have outlined at Space and ALL equipment types are at critical levels with all main ports in China & South East Asia affected. Where possible, the substitution of 40' equipment types to 20'GPs has had to be sought in order Congestion and delays continue to be rife in the major hubs of Singapore and Port Ketang with delays of up to 3 weeks still reaping havoc. As advised previously some carriers are still suspending services f ports and Fremantle and Adelaide ports have been severely affected as a consequence. Pressure on rail to transport cargo from east coast Australia to W.A. has also been impacted with up to 2 - 4 weeks c There is also 2-week minimum reported delays for cargo that is shipping ex inland China (Yangzi River) in Shanghai as the backlog there continues to mount. While some consortiums are reporting double re their utmost to control this by inducing extra loaders to clear this and only taking this cargo with no new bookings being entertained until the situation improves. Others with a clear space allocation managem however, delays are still evident and unavoidable. Priority Paid products with a premium for guaranteed loading at additional USO 500 - 800 per TEU on top of the market rates are also under pressure as o is given to these and some even being turned away as the demand is too strong. Some carriers have continued to implement premiums on 40' equipment due to the major shortages that are being faced as operational issues being faced with congestion and port omissions in Australia adding to these woes, hindering this process. Despite the 14 day booking in advance prior to cargo ready date, some carriers are reporting lead times for booking now in excess of 3 weeks, ie. 21 days (please use this as a current guide), however, this, to cargo that has been left behind due to port omissions/ blank sailings and adverse weather conditions as Typhoon season is still very much an issue in some China origins. As we have raised before, the e time bar on the equipment interchange releases (EIR) expires (after 24 hours) if suppliers do not pick up equipment In a prompt manner and a first in first served basis is being adopted at the depots at origin expires the process has to be re-applied and at times unsuccessful. This situation is going to persist now until at least after Chinese New Year (February 12 th , 2021) if the demand nows continue to be high versus the available supply and all forecasts are pointing to this. Further rate Increases are expected to take place and Port Congestion Surcharges and/or PSS will continue until the situation improves. We have seen a string of GR l's being imposed and gaining traction for the most part of this year with historical freight rates taking hold: November 1st I November 7t h (PIL) November 15 th all at quantum's ra which over 85% of these have been successfully implemented. We are still having to compete with China to South America and USA East Coast for equipment which are among the 2 highest priced trades with rates. According to the Shanghai Containerised Freight lnde rates. Due to the unprecedented market, there is a strong possibility for further rate hikes in December/ January at approx. USO 300.00 - USO 500.00 per TEU of which we estimate a large percentage of these w historically high freight rate levels which will set the precedence for 2021 tenders and NAC offerings if demand continues to outpace current supply with an extremely higher base being touted in comparison DECEMBER 2020 NEWSLETTER The schedules are in chaos due to the effects of last month's Industrial Action disruption. Equipment supply is being impacted as a result of vessel delays and omissions at some ports, not Sydney as we knc Carriers advise there will be Sydney omissions planned on some services (AA 1 & AA2.). We rarely see any rate hikes on the export trades from Australia however, given the factors as explained above, Carriers have announced a GR! to come into effect from November and also basic ocean ratE rates will also keep climbing upwards from November well into 01-2021. Sydney port congestion surcharges and recovery costs will continue until the Port Botany situation improves. Coastal services continue to be restricted with most carriers (OOCL I COSCO/ PAE/PIL and no1 improvement until January 2021. The focus is to get International trade moving before carriers remedy their situation on the coastal trades. We continue to work with ANL on this route as they are the only ca allocation albeit small to move some cargo across for our existing clients. We will continue to keep you updated if the situation changes as we explore all avenues to assist our customers in moving their cargo during this difficult time.