People's Logistics China Magazine

18/05/2022

Rail thrives at Port of Gothenburg in first quarter
May 18 2022

OVER half of container freight passing through the Port of Gothenburg was transported by rail in the first quarter of 2022, reports London's Port Technology International.

From January to March 2022, 126,000 TEU was transported by rail, around 60 per cent, the highest figure in the port's 400-year history.

This rise in intermodal transport is helping mitigate the current truck driver shortage affecting many other ports.

This shortage has been adversely impacted by the Covid crisis and the war in Ukraine.

Last year, new rail shuttles were introduced and the number of departures and volumes on existing routes grew immensely.

Recently, Green Cargo launched a new freight shuttle between the Port of Gothenburg and Rosersberg, near Stockholm.

Overall volumes at the port increased four per cent year-on-year to 212,000 TEU in Q1 2022, marking the sixth consecutive quarterly rise.

"Ultimately, the Port of Gothenburg's volume upturn is the result of exemplary handling at all levels, from when the vessels arrive in the port area until they leave," said Gothenburg Port authority chief executive Elvir Dzanic.

"When conditions are difficult and vessels call irregularly, extraordinary efforts are required from everyone involved, both on the sea and landside. It is the sum of these efforts we now see in black and white."

04/04/2022

Box traffic on ro-ro ferries on China-South Korea trades reaches new high
Apr 04 2022

THE volume of containers shipped between China and South Korea on ro-ro ferries reached an all-time high of 671,100 TEU last year, as shippers sought to bypass congested container terminals and secure shipping slots.

The vessels, commonly labelled "car ferries" in South Korea as they mainly carried passengers and cars pre-Covid, have been filled by cargo as tourism ground to a halt in the pandemic, reports UK's The Loadstar.

Exports accounted for 225,600 TEU of 2021 volumes, while imports comprised 445,500 TEU. Ro-ro ferry services commenced between China and South Korea in 1990, when the countries established diplomatic relations in the last days of the cold war.

Container volumes going by ferry last year rose 20 per cent on 2020, when 559,400 TEU was transported - just 2 per cent up on 2019 - indicating that more shippers turned to ferries as logistical bottlenecks intensified in 2021.

But, as liner operators upped freight rates, the Ministry of Oceans and Fisheries said ro-ro ferry operators had kept their rates unchanged in 2021, at around US$300-$350/TEU. However, the surge in bunker prices amid the Russia-Ukraine war is expected to mean higher freight rates this year.

With the exception of September, every month last year saw double-digit growth in earnings. Particularly, in January and February, when they soared by 45 per cent and 35 per cent year on year, respectively, due to the low base in the pandemic's early days.

And among the 12 South Korea-China ferry operators, Rizhao International Ferry carried the most containers last year, 67,600 TEU between Pyeongtaek in South Korea and Rizhao in China. This was up 30 per cent on 2020. In second place was Huadong Shipping, which carried 65,700 TEU between Incheon in South Korea and Shidao in China, up 20 per cent year on year.

04/04/2022

Cosco Shipping Ports' 2021 net profit edges up 2.1pc to U$354.7m
Apr 04, 2022

MAJOR port operator Cosco Shipping Ports posted a net profit of US$354.7 million in 2021, a slight increase of 2.1 per cent over the previous year.

Revenue surged 21 per cent to $1.21 billion with solid growth from most of its terminals, as global trade recovered from the pandemic's hit, while shipping fees surged on tight shipping capacity and port congestion.

Cosco said in a statement that the bottom-line growth was in part slowed down by lower disposal gains in 2021. Excluding one-off disposal profits' impact, profit rose 24 per cent.

In 2022, the company expects a slowdown in China's foreign trade, which has boosted its strong growth in the past year, as other countries resume local production.

In 2021, as pandemic-related supply disruptions lingered, many overseas countries increased imports from China, where manufacturing activities largely remained normal due to the country's "zero-infection" policy.

Total throughput of the Greater China region increased by 4.1 per cent year on year to 99,275,231 TEU in 2021 (2020:95,380,835 TEU) and accounted for 76.8 per cent of the Group's total.

The Yangtze River Delta region volume increased by 4.5 per cent to 15,436,773 TEU in 2021 (2020: 14,768,442 TEU) and accounted for 11.9 per cent of the group's total. Shanghai Pudong International Container Terminals Limited and Shanghai Mingdong Container Terminals Limited secured some ad-hoc shipping calls, and the throughput increased by 6.4 per cent and 9.6 per cent to 2,600,511 TEU and 6,845,534 TEU respectively (2020: 2,443,406 TEU and 6,246,932 TEU).

Southeast Coast region throughput increased by 12.9 per cent to 6,149,785 TEU in 2021 (2020: 5,445,662 TEU) and accounted for 4.8 per cent of the group's total, while the Pearl River Delta throughput of the Pearl River Delta region increased by 3.4 per cent to 28,841,688 TEU in 2021 (2020: 27,898,470 TEU) and accounted for 22.3 per cent the group's total. Driven by the increase in the US, EU and empty cargoes, the throughput of Yantian Terminals increased by 6.1 per cent 14,161,034 TEU (2020: 13,348,546 TEU).

Total throughput of the Southwest Coast region increased by 11.7 per cent to 6,011,800 TEU in 2021 (2020: 5,383,701 TEU) and accounted for 4.6 per cent of the group's total, which was mainly benefited from the increased trade activities between China and Southeast Asia.

The total throughput of its overseas ports increased by 5.5 per cent to 30,011,144 TEU in 2021 (2020: 28,443,740 TEU) and accounted for 23.2 per cent of the group's total.

Due to the continuous congestion of major ports in northwest Europe, CSP Zeebrugge Terminal became an important buffer port for the region and, together with the addition of new routes, its throughput increased by 52.9 per cent to 931,447 TEU (2020: 609,277 TEU).

As result of new routes and the significant increase in local cargoes due to the increased ability to connect to the cargo hinterland, the throughput of CSP Spain related companies increased by 6.9 per cent to 3,621,188 TEU (2020: 3,387,820 TEU).

"Looking forward to 2022, despite the complex and uncertain global macro environment, the resilience of China's economic development, the strong domestic market, a sound supply system and the coming into force of the Regional Comprehensive Economic Partnership ("RCEP") will provide support to China's economy and the long-term economic fundamentals will remain unchanged," the company said.

"With the pe*******on of vaccines and the gradual recovery of production capacity in developed countries, the growth rate of China's foreign trade is expected to slow down in 2022, and the demand for container transport will gradually return to normal."

Professional shipping and forwarder news from China.

16/03/2021

GAC opens office in Shenzhen to handle rising demand in South China
Mar 16 2021

UNITED Arab Emirates-based Gulf Agency Company (GAC) has opened a new office in Shenzhen.

Having its own non-vessel operating common carrier (NVOCC) licence and ship agency licence, GAC Shenzhen will handle the group's shipping and logistics operations in South China.

GAC Shenzhen's coverage extends to the international airports in Shenzhen and Guangzhou, as well as the main logistics seaports including Yantian, Shekou, Chiwan, Huangpu, Nansha, Zhongshan, Foshan, Jiangmen, Guangxi, Shantou, Zhanjiang, Zhuhai, Haikou, Sanya, Macau and more.

"Customers can enjoy greater convenience and more cost-efficient services with GAC Hong Kong acting as a single contact point for access to all ports in South China through our office in Shenzhen," said GAC Hong Kong/Shenzhen managing director Maria Lam.

GAC Hong Kong was set up as the GAC Group's first operation in Asia in 1974. Ms Lam expressed optimism that the Shenzhen office will fortify GAC's presence in South China, in particular, Guangdong-Hong Kong-Macau Greater Bay Area.

"Besides its role in the Belt and Road Initiative, the Greater Bay Area is one of China's key maritime, aviation and logistics hubs today. As a leading shipping and logistics service provider with an established foothold in Hong Kong and South China, GAC is well placed to tap into the multitude of opportunities that the region presents."

16/03/2021

EU develops China investment deal to boost European firms
Mar 16 2021

A NEW EU-China investment deal will potentially rebalance the EU-China investment relationship while boosting European firms, reports Bloomberg.

The accord received political approval in December and has expanded access to the Chinese market for European investors in industries ranging from cars to telecommunications.

It also aims to tackle underlying market-distorting Chinese policies such as industrial subsidies, state control of enterprises, and forced technology transfers.

"The EU-China Comprehensive Agreement on Investment will help to level the playing field and provide more market openings for EU companies and investors," said EU Trade Commissioner Valdis Dombrovskis.

China was the EU's second-largest 2019 trade partner behind the US with two-way goods commerce valued at US$1.2 billion a day.

"The agreement provides a clear and enforceable framework of rules, which will give EU businesses greater access and more certainty when investing in China," said Mr Dombrovskis.

16/03/2021

Transpacific disruptions expose flaws in box shipping contracts
Mar 16 2021

CARRIER CEOs attending JOC's virtual TPM21 conference have called for more enforceable commitments in container shipping contracts after Covid-driven supply chain disruptions have resulted from their short comings.

Carriers and shippers are preparing to sit down for annual service contract negotiations in the transpacific amid a chaotic environment upended by months of strong demand, severe port congestion, and an overloaded US inland logistics system.

But executives from Hapag-Lloyd, Ocean Network Express (ONE) and Maersk told the conference that the way service contracts were structured has left both carriers and shippers more exposed to the supply chain upheaval.

"In the perfect storm that we have seen in the last couple of months, we have seen that the traditional contracts give us increasing challenges," said Hapag-Lloyd CEO Rolf Habben Jansen.

"On the one hand, you see a lot of changes on the carrier side with ships that need to be changed and voyages that need to be altered, and on the other hand, no-shows have been as high as 30 to 40 per cent, which makes it very difficult to plan, especially when the market is already very hectic," he said,Mr Habben Jansen said shippers and carriers had to commit to what was agreed on their sides of the contract, and face the consequences of non-compliance.

AP Moller-Maersk ocean and logistics CEO Vincent Clerc said two-way commitments were the way forward, and the goal was to have 100 per cent of the carrier's cargo transport business structured that way in the coming years.

"It makes sense that we have a clear view on what we are going to do for each other," Mr Clerc said in an interview. "There are ways to do that which are very compelling for our customers. It is not [the spot market] that is the future, but two-way commitment models, across a family of products that deal with customer expectations." He advised shippers not to approach the upcoming 2021-22 service talks as contract negotiations, but rather as business negotiations.

Ocean Network Express (ONE) CEO Jeremy Nixon said in the current environment of heavy demand, port congestion, and equipment shortages, it was a challenge to honour all the space commitments made to shippers.

"We sit down at the beginning of the year and try to work out a volume contract agreement into how many containers that means a week, out of which port on which particular loops, and we commit to make the space available," Mr Nixon said in a separate TPM21 interview.

"We accept that sometimes factory production can change, and sometimes weather issues mean the ships can't always come in on schedule," he added. "It is unfortunate that when we get situations like this it is very difficult."

But Mr Nixon said the industry was slowly moving in the direction of enforceable contracts. "On the spot market now, there are specific mechanisms that say: 'I commit to move this many boxes on this particular ship, at this particular time at this particular rate, and if I fall short of that, this will be the consequence, and this will be the financial compensation'," he said.

The three executives acknowledged the poor service levels being provided by their carriers, with schedule reliability on the transpacific falling to an incredible 13.8 per cent in January, according to Sea-Intelligence Maritime Analysis.

Mr Nixon said a key part of restoring schedule reliability would be for carriers to be able to make more accurate operational forecasts.

04/03/2021

Global cargo traffic jam could last into 2022, Freight CEO warns
By: Thomas Black | Mar 03 2021 at 02:16 PM

A cargo traffic jam on the world’s roads, seas and air corridors could easily continue into next year, continuing to increase shipping costs, according to the head of one of the biggest U.S. freight brokers.

“The domestic freight markets are extremely dislocated and the global air-freight and ocean markets have tremendous amounts of constraints around them,” said Bob Biesterfeld, chief executive officer of C.H. Robinson Worldwide Inc. “We could be standing up a pretty strong freight market throughout 2021, if not into 2022.”

That promises a windfall for truckers, air-freight companies and maritime shipping lines. Retailers, manufacturers and anyone else who pays to get goods across the globe will get pinched.

As a broker, contracting with carriers on behalf of shipping customers, C.H. Robinson can get squeezed when long-term contracts don’t keep pace with spot costs but adjust as new contracts are negotiated. The Eden Prairie, Minnesota-based company projects an adjusted operating margin of 40% for its North America Surface Transportation unit this year, improved from about 33% last year.

Annual contracts for long-haul trucking will probably rise in the low-double-digit percentages this year, driven by spot rates that have jumped 35% from a year ago, Biesterfeld said in an interview. Air-freight prices have almost doubled from a year ago.

Maritime rates have surged the most. The cost of shipping a 40-foot container from Hong Kong to Los Angeles has nearly quadrupled in the last year, said Bloomberg Intelligence analyst Lee Klaskow, based on data from research firm Drewry.

The crunch developed as people who were barred by the Covid-19 pandemic from going to movies, concerts and restaurants spent their money on flour and treadmills instead. The effect was magnified in countries where citizens received government relief. Shortages of trucks and drivers, in some cases because of enhanced unemployment benefits, contributed to supply-chain bottlenecks. So, too, has the reduction in airline flights, which typical carry some freight.

And the seaborne freight industry is tapped out. The Port of Los Angeles, the busiest in the U.S., is operating above what is considered full capacity in a normal market, JPMorgan Chase & Co. analyst Brian Ossenbeck said in a note Monday.

“There’s no fast way to recover there,” Biesterfeld said. “There are no extra ships sitting around waiting to be deployed.” Customers that normally could book a container days before shipping now have to act weeks in advance. Some companies in desperation are turning to more-expensive air freight.

“We’re running weekly charters today from the EU to the U.S. and from Shanghai to the U.S., just to keep up with the incremental demand coming from our customers,” he said. “The demand is pent up and it continues to remain strong.”

04/03/2021

Singapore port hit by container congestion, surge in vessel calls

Mar 04 2021

CONTAINER vessels planning to berth at Singapore port are now having to face up to five to seven days from a maximum of two days to turn around an 18,000 TEU vessel.

"There is a lot of port congestion in Singapore, which is one of the biggest factors," a freight-forwarder based in Singapore said, adding that vessels calling at the Lion City have not departed on time since September.

According to PSA International, Singapore has been experiencing an increase in activity. "Like many other ports across the world, PSA Singapore has been experiencing a surge in vessel calls and container volumes in recent months," a PSA corporate spokesperson said.

"This exceptional situation is due to a confluence of factors, including an unprecedented and volatile surge in cargo demand, congestion across all nodes in the global supply chain (including depots, warehouses and seaports) due to renewed lockdowns, a lack of usable empty containers while laden ones are held up longer at these nodes, and shipping lines' vessel sailing schedule reliability dropping to 10-year historical lows, causing further delays at almost every seaport worldwide."

PSA Singapore has been ramping up additional capacity and resources "and is working closely with shipping line customers and cargo owners to alleviate the situation."

The number of vessels staying at Singapore port for more than two days in January, averaged 46 per day, about 59 per cent higher than January 2020, according to data from London's S&P Global Platts.

The average number of vessels staying at Singapore port for more than two days each day peaked in November, at 49, compared with 17 in the same month of 2019.

This congestion has had a knock-on effect on spot container freight prices, where exports from Singapore to North America have attracted higher pricing relative to other ports in Southeast Asia.

One source said that ports in the region, including in China and Southeast Asia, are facing congestion issues. Some cargoes from other ports such as Port Kelang and Colombo have also been diverted to Singapore due to logistical issues.

02/03/2021

DHL uses leisure airline Condor to operate PAX-freighter flights
Mar 02 2021

GERMAN holiday travel airline Condor will fly four of its Boeing 767s on behalf of DHL Express utilising belly capacity. The first cargo flights under the partnership took off last week.

The Condor planes will be based at DHL Express' largest European hub in Leipzig and will transport shipments along three routes - to Shannon, Ireland, Milan-Malpensa in Italy, and Cologne, Germany.

These flights would also be available to transport Covid-19 vaccines and the partnership will initially extend until the end of May, reports London's Air Cargo News.

Condor chief operating officer Christian Schmitt said: "We began flying more cargo last year and continued to build on our airfreight expertise. The partnership also demonstrates Condor's ability to adjust to unusual situations and, in this case, to work together with DHL to make an important contribution to maintaining international supply chains."

Markus Otto, senior vice president aviation Europe at DHL Express, said: "This partnership between cargo and passenger carriers is unique," adding: "It allows us to react even faster and more flexibly to the continued high demand for international express service.

"The additional capacity through Condor allows us to further improve service quality and transit times and maintain our growth trajectory."

Since April of last year, Condor has devoted an increasing number of flights to cargo, primarily transporting medical protective equipment - including millions of face masks, protective suits and gloves - in addition to e-commerce goods.

In the process, a portion of Condor's Boeing 767 fleet has been converted to pure cargo aircraft. For a period, 14 of Condor's 16 Boeing 767 aircraft were being used solely for cargo. The airline also trained and deployed a team of cargo supervisors to oversee cargo operations and ensure quality ex*****on.

For Deutsche Post DHL Group's Express division, the partnership is part of a programme of action measures to expand capacity in the face of growing express volumes worldwide and maintain the company's growth trajectory. Early in 2021, DHL Express announced additional purchases of new wide-body Boeing 777F aircraft.

02/03/2021

U-Freight all set for final phase of air cargo security screening in HK
Mar 02 2021

U-FREIGHT in Hong Kong is fully prepared for the implementation on March 1 of the fourth and final stage of the enhancement of international standards on air cargo security announced by the International Civil Aviation Organization (ICAO) which commenced on January 1 2020.

Simon Wong, UFL's chief executive officer said: "The final phase demands that all consignors of air cargo must be approved by the appropriate authority as a 'validated' Known Consignor (KC), with any consignee not validated becoming an "unknown consignor" with all their cargo subject to 100% security screening prior to being loaded on to a commercial aircraft, to meet the ICAO deadline of 100 per cent screening of non-known consignee cargo by June 30, 2021."

In Hong Kong, since January 2020, a transitional arrangement has been set up that has required the RACSF to gradually increase the percentage of air cargo being screened.

Over two years ago, the U-Freight Group installed an X-ray machine at its Golden Bear Industrial Centre in Hong Kong, giving staff adequate time to gain experience in the scanning process, as well as helping to identify prohibited/suspect products inside the ever-increasing number of e-commerce parcels it handles.

A second enhanced X-ray machine was installed in July 2019, which can scan consignments up to pallet size. The company modified its export operations warehouse to accommodate the existing X-ray machine, as well as the newly purchased one.

Mr Wong adds: "The U-Freight Group fully supports the ICAO aviation security requirements and has worked closely with CAD, Hong Kong Airport Authority, Cargo Terminal Operator and HAFFA in making the necessary preparations to make sure that we enhance our air cargo security regime to meet international aviation security requirements.

"The establishment of off-airport screening facilities in Hong Kong enables air cargoes to be screened at the existing warehouses or similar premises of the air cargo industry before such cargoes are transported to the airport for loading onto aircraft.

"We were very keen to capitalise on this opportunity and were very pleased to become one of the first freight forwarders and logistics companies to have been accredited by CAD, which enabled us to prepare to play our part in the new ICAO regime.

02/03/2021

Cathay Pacific gets in on Covid vaccine deliveries
Mar 01 2021

CATHAY Pacific has successfully delivered the first batch of one million Fosun Pharma/BioNTech vaccines to Hong Kong from Frankfurt.

The airline's director cargo Tom Owen said: "Different vaccines have differing requirements. The Fosun Pharma/BioNTech vaccine must be transported in a deep frozen state, which requires more complex transportation and storage solutions.

"Our Vaccine Solution has proven itself to be ideally suited to the fast and effective distribution of this and other vaccines across the globe, using our freighter and passenger fleet, and our extensive global network."

Cathay Pacific shipments to date include the milestone import of the first vaccines for use in Hong Kong on February 19. The one million doses of Sinovac vaccine were loaded inside six temperature-controlled Envirotainer RAP e2 containers, to maintain the vaccine temperature range of 2 degrees celsius to 8 degrees celsisus, and carried in the belly hold of an Airbus A330 operating the scheduled passenger flight, CX391.

Mr Owen added: "This was also the first shipment to use our new Ultra Track service, a key part of our Vaccine Solution."

On the same flight, there were 200,000 doses of the Sinovac vaccine destined for Mexico. Another shipment of 800,000 doses to Mexico will follow this week. Cathay Pacific had previously carried a CanSinoBIO vaccine shipment via Beijing and Hong Kong to Mexico earlier in February, and the airline has already also transported a Fosun Pharma/BioNTech shipment to Penang on one of its freighters.

So far, the Cathay Pacific Cargo Vaccine Solution has proven to offer the high levels of quality assurance demanded by these vital shipments. This level of dedication and expertise has been recognised not only by our customers, but also UNICEF, which named Cathay Pacific Cargo as one of the select airlines for its Humanitarian Airfreight Initiative to support COVAX, the global effort aimed at equitable access to COVID-19 vaccines.

To increase links with the European vaccine production hub, Cathay Pacific Cargo is adding a further two Boeing 777 cargo-only flights to operate on the Pharma Corridor between the CEIV-certified airport communities of Brussels and Hong Kong each week, Cathay Pacific said in a statement.