World Maritime News
5 March 2020
Coronavirus – Pessimistic short-term outlook for container shipping
The impact of the container shipping has just about been bearable, according to Drewry, but the longer and more widespread the outbreaks goes, the more damage it will cause. To date, the short-term hit had included port volumes in China falling between 20% and 40% in the three weeks from January 20, and the cancellation of more than 100 sailings from China in February. Drewry said we should expect at least two months’ worth of global volume falls.
But a portion will be made up later via full ships and extra loaders, although the short-term damage to carrier profits is large, Drewry commented.
Read more: Lloyd’s List
Coronavirus -container impact to spread far beyond blank sailings
The sharp drop in demand led container carriers to cancel numerous sailings. The new blank sailings will inevitably lead to a raft of blank sailings for export cargo back to Asia anywhere from 3 to 10 weeks into the future, depending on transit times. The pre-Chinese New Year peak results in a substantial number of empty containers building up in places such as Europe and North America. With the sudden additional shortfall in capacity due to blank sailings, carriers will be hard pressed to cater for the repatriation of empties in combination with the actual export cargo to Asia. In the most positive outlooks, the outbreak will subside, and Chinese factories will ramp back up again, and at a higher rate than usual in order to catch up with lost production. This will create a surge in demand for container transportation. The carriers will have problems getting their equipment back to China, and exports will be hampered by an equipment shortage.
Read more: JOC
Ports of Long Beach and Los Angeles sign agreement to improvement market share
The Harbor Commissions of the Ports of Los Angeles and Long Beach have approved an agreement aimed at reversing their loss of market share to rival ports along the US east and Gulf coasts. The two ports, which jointly represent the nation’s largest seaport complex with a combined throughput of some 18 million teu a year, plan to work with industry stakeholders to improve efficiencies and lower costs for shippers while improving sustainability, business continuity and security. The two ports’ share of all containerized cargo passing through US mainland ports dropped from 28.8% in 2003 to 26.9% in 2018. The new agreement aims to reverse that trend, a point underscored by directors of the two facilities. Recently LA and LB have focused on the use of data sharing among all stakeholders to identify productivity issues at marine terminals.
Canadian ports struggle to recover from rail blockage
Disruptive protests began at the beginning of February after five hereditary chiefs of the Wet’suwet’en Nation intensified their opposition to the construction of a U$ 6.6 billion natural gas pipe-line across their land in British Columbia. Some shipping companies avoided calling Prince Rupert and Vancouver. The Port of Montreal said that during 21-24 February about 15% of the containers at the port were immobilized by the blockades. Canadian police dismantled a blockage of a Canadian National Railway line at Tyendinaga on 24 February and Ontario Provincial Police broke up the blockage and arrested some protesters. While the situation has improved slightly in Montreal, the Port of Halifax still has no Canadian National Railway (CN) service, and the Prince Rupert and Vancouver were seeing reduced dwell times as they cleared up the cargo backlog with help of restored rail service. CN, using an alternative route, is moving some trains in and of the port, albeit using shorter trains and with a lower frequency than is needed to handle the heavy volume of cargo in the port.
Small island states point out flaws in shipping’s U$5 billion R&D fund proposal
The Solomon Islands and Tonga want governments to have greater control of funding and consider the needs of less-developed countries and small island developing states. The OECD is raising the alarm that the U$ 5 billion R&D fund resembles government subsidy schemes for shipping. It is being argued that if the IMO is the body approving the R&D fund, it should also be the body to decide where the money goes. Another major objection to the current plan is that rather than charging U$ 2 per ton of fuel oil that each ship consumes, flag states should collect U$ 0.5 from shipping companies for each gross ton in their fleet as they do with multiple fees.
Read more: Lloyd’s List
Hydrogen could be option for transpacific container ships
Most of container ships operating in the Pacific Ocean between China and the US would require only minor adjustment to be powered by hydrogen, according to a study. The International Council on Clean Transportation (ICCT) said in its study that 99% of those transpacific voyages could be powered by hydrogen instead of fossil fuels, with only limited changes required to a vessel’s capacity or operations. In general, it is medium-sized container ships ranging from 3,000 teu to 12,000 teu that would be best able to run on hydrogen without sacrificing cargo space or adding a refueling stop, as smaller and larger ships lack either the space or the large fuel tanks to complete long-distance routes. Other potential alternative fuels for ships such as ammonia or methanol carry more energy per unit volume than liquid hydrogen, which suggests they could be used more easily than hydrogen, the ICCT report says.
Logistics investors pour funds into yard automation startup
A yard automation startup landed a U$ 53 million funding in the Week 7, a sign that makes the interchange of containers and trailers logistics more efficient. Colorado-based Outrider emerged from two years of stealth operations announced the funding from a host of venture capital investors, including logistics-focused firms such as 8VC, Prologis Ventures and Schematic Ventures. Outrider’s business model has three facets that span the software and hardware spectrum: yard management software, autonomous zero-emission yard trucks and on-site fixed infrastructure. Schematic Ventures general wrote that the company is attempting to solve roadblocks at a critical inventory management node. “Container yard can be messy at best and chaotic at worst. Hundreds of trucks and dozens of loading docks are managed by pen and paper. Accidents are common as trucks are extremely difficult to navigate in tight space. Drivers are delayed, detention costs pile up, critical inventory is misplaced and employee safety is often at risk.”