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Freight market update - 27 December 2023

Beeontrade

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December 2023

8 min read

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Freight market update - 27 December 2023

From the Editor’s Desk

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Key takeaways for the US

  • The U.S. Congress has approved a measure prohibiting the Pentagon from utilizing seaports worldwide that depend on the Chinese logistics platform known as LOGINK.

  • China's road logistics price index experienced a marginal decrease of 0.02 percent in the week spanning from December 18 to 22, as per industry data.

  • A dedicated rail terminal for freight between Xi'an, Shaanxi province, and Kazakhstan officially commenced operations to enhance trade between China and Central Asia.

  • Ekol Logistics, in collaboration with Rail Cargo, conducted the first trailer passage on the Marmaray line.

Read on for more in-depth updates.

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Ocean Freight Market Updates

Asia → North America

US/CA

Transpacific Trends and Market Updates

  • The U.S. Congress has approved a measure prohibiting the Pentagon from utilizing seaports worldwide that depend on the Chinese logistics platform known as LOGINK.
  • LOGINK, which tracks cargo and ship movements, enables Beijing to oversee the United States' military supply chain reliant on commercial ports, according to Senator Tom Cotton and Representative Michelle Steel, the sponsors of the amendment.
  • The amendment, integrated into the National Defense Authorization Act (NDAA) for fiscal 2024, also forbids federal funding for ports utilizing LOGINK.
  • The spending bill, passed on December 14, stipulates that the LOGINK ban will become effective six months after the bill is signed; however, President Joe Biden has not yet signed the NDAA.
  • Representative Michelle Steel expressed the seriousness of LOGINK's threat in an email interview with VOA, highlighting its operation under the Chinese Communist Party, which already has investments in approximately 100 ports across more than 60 nations.
  • China's road logistics price index experienced a marginal decrease of 0.02 percent in the week spanning from December 18 to 22, as per industry data.
  • The survey, conducted by the China Federation of Logistics and Purchasing in collaboration with Guangdong Lin'an Logistics Group, reported the index at 1,039.96 points for this period.
  • The sub-index specifically gauging full-truckload logistics prices, which mainly assesses bulk-commodity and regional transportation, declined by 0.05 percent week on week, reaching 1,041.51 points.
  • The survey explained that the modest decline in the price index was attributed to the slowed growth of demand in the sector, despite generally stable supply conditions.
  • Future predictions from the survey anticipate mild increases in the index with some fluctuations, indicating a relatively stable outlook for the coming period.
  • Last week, a dedicated rail terminal designed for freight between Xi'an, Shaanxi province, and Kazakhstan officially commenced operations, aiming to enhance trade between China and Central Asia.
  • Named the Kazakhstan Xi'an Terminal, the facility spans nearly 50 hectares within the Xi'an International Port, primarily featuring cargo warehouses and container storage areas.
  • The terminal's purpose is to facilitate the "fast delivery and quick pick-up" of containers, establishing a direct link between Kazakhstan and Xi'an, as stated by the inland rail port.
  • The completion of this project holds significant importance for strengthening cooperation between China and Kazakhstan, presenting opportunities for expanding clientele, increasing trade, and fostering investment.
  • The entire project, completed within a three-month timeframe, stands out as a noteworthy achievement resulting from the first China-Central Asia Summit held in Xi'an in May.
  • During the summit, a total of 17 projects, either in or involving Shaanxi, were finalized, according to the Xinhua News Agency.
  • Notably, on October 27, another project was launched, involving the construction of a new logistics terminal in Almaty. This project, a collaboration between Kazakhstan Temir Zholy and Xi'an International Trade and Logistics Park, further contributes to the strengthening ties between the regions.
  • The Songjiang District in Shanghai is emerging as a crucial logistics hub in China's Yangtze River Delta, playing a key role in facilitating the movement of sci-tech components, innovation, and talent within the region.
  • Recently, a G60 cross-border freight train, loaded with household appliances, engineering machinery, and optical instruments, departed from Songjiang toward Laos and Myanmar, marking a significant milestone for the district.
  • Positioned in the G60 S&T Innovation Valley of the Yangtze River Delta, Songjiang covers an extensive area of 76,200 square kilometers, linking nine cities and districts, including Shanghai, Jiangsu Province, Zhejiang Province, and Anhui Province.
  • Functioning as a central hub for logistics operations, Songjiang connects cities within the innovation valley and establishes links with other regions in the Yangtze River Delta.
  • The successful departure of the first international freight train from Songjiang underscores its growing importance as an international multi-modal logistics hub, demonstrating its efficiency in handling the transportation of goods between China, Laos, and Myanmar.
  • In alignment with Shanghai's local plan, the Shanghai-Suzhou-Huzhou high-speed railway is set to begin operations in 2024, with the Song Jiangnan Railway Station as the initial station.
  • This development is expected to accommodate an estimated annual passenger flow of over 20 million people in the future, further solidifying Songjiang's role as a pivotal transportation hub within the Yangtze River Delta.
  • The United States has sent over 10,000 tons of military weapons and equipment to Israel since the commencement of the war on October 7, as reported by Channel 12.
  • These deliveries were made through 244 cargo planes and 20 ships.
  • The invasion of the northwestern Negev by the Hamas terror group on October 7 resulted in the deaths of 1,200 people, predominantly civilians, prompting the initiation of "Operation Swords of Iron" with backing from Washington.
  • According to the report, Israel's Defense Ministry has made additional purchases from the United States totaling nearly $2.8 billion.
  • This encompasses armored vehicles, armaments, personal protective equipment, medical supplies, ammunition, and more.
  • The report also notes that Israel's military production lines are operating continuously around the clock during the ongoing war.

Turkey → North America

  • Gulf Navigation Holding PJSC (GULFNAV), a maritime and shipping company listed on the Dubai Financial Market, has announced the acquisition of 40% of Turkish Polimar Holding Company's stake in Gulf Navigation Polimar Maritime.
  • With this acquisition, GULFNAV increased its stake in Gulf Navigation Polimar Maritime from 60% to 100%, aiming to boost revenues by expanding the scope of Maritime Agency Services in line with its strategic plan for the coming years.
  • Gulf Navigation Polimar Maritime, established in 2017, has become a subsidiary of Gulf Navigation Holding PJSC through the partnership with Turkish Polimar Holding.
  • The company, headquartered in Dubai with offices in Khorfakan and Fujairah, serves as a one-stop shop catering to all terminals and commercial ports in the UAE, handling various types of vessels and cargo.
  • Over the past six years, Gulf Navigation Polimar Maritime has successfully expanded its business scope, enabling it to provide services to customer ships in most of the significant commercial ports, including those in the UAE.
  • Ekol Logistics, in collaboration with Rail Cargo, achieved a significant milestone in Turkey by conducting the first trailer passage on the Marmaray line.
  • This marks the inauguration of a trailer train for export from the Anatolian side to Europe, showcasing Ekol Logistics' pioneering role in the logistics industry.
  • The journey, commencing from Köseköy (Kocaeli) station, will traverse the Bulgaria, Romania, Hungary line, ultimately concluding in Bratislava, Slovakia.
  • The transit period for six export trailers loaded onto wagons is expected to take seven days.
  • The successful passage eliminates a major hurdle for utilizing the Marmaray line in international transportation.
  • The Marmaray tunnel, connecting Istanbul's two sides beneath the sea floor, had previously restricted the passage of trailers, complicating export transportation from the Anatolian side to Europe.
  • Ekol Logistics' initiative paves the way for more active utilization of the Marmaray line in international transportation, contributing to the enhancement of Turkey's export potential and the overall development of the logistics sector.
  • This accomplishment is considered a significant success for Turkey in the logistics domain, positioning the country for increased competitiveness in international trade.

North America → Turkey

  • Kale Logistics Solutions (Kale) is set to introduce an Airport Cargo Community System (ACS) at Istanbul Grand Airport (İGA), marking the first instance of digitizing cargo data exchange at an airport in Turkey.
  • The Airport Kargo Paydaş Platformu (KPP), a cargo community platform developed by Kale, will be implemented at İGA in collaboration with TroyNet.
  • The ACS platform is designed to support İGA in becoming a regional cargo transfer center for prominent cargo companies globally.
  • It aims to achieve this by facilitating end-to-end digitalization, improving efficiency, simplifying procedures, and automating communication among stakeholders within its cargo precinct.
  • The Biden administration has unveiled a set of initiatives to enhance supply chain resilience.
  • The inaugural meeting of the White House Council on Supply Chain Resilience took place on November 27.
  • Co-chaired by national security and economic advisors, the council's members consist of almost all cabinet members, including the secretaries of Commerce, Defense, Transportation, Labour, and Treasury.
  • This council is part of a comprehensive strategy that encompasses nearly 30 measures focused on securing strategic supplies of critical medicines.
  • President Joe Biden convened the inaugural meeting of the newly launched Supply Chain Resilience Council, signaling a focused effort to address long-standing concerns about supply chain resilience.
  • The council's primary objectives include strengthening America's supply chains and reducing costs for families, with a specific emphasis on actions to enhance access to medicine, economic data, and other programs related to the production and transportation of goods.
  • The council announced a comprehensive plan comprising 30 actions aimed at improving various aspects of the supply chain.
  • The U.S. government's continued attention to the domestic supply chain is viewed as a strategic move to further mitigate inflation, which had been exacerbated by disruptions in the supply chain.
  • Inflation, which reached a high of 9.1% in June 2022, has since decreased to 3.1%. Despite facing inflation and higher logistics costs (with the U.S. Business Logistics Cost rising by 19.6% in 2022), President Biden referred to companies engaging in "price gouging" as part of the challenges being addressed.

Terminal Updates

  • Vessels heading to North America via the North Atlantic Sea are expected to have a change in schedule due to severe weather conditions.

 

New York:

  • No waiting time is expected for a berth at Maher Terminals LLC.
  • Up to 1.5 days waiting time at APM Terminals.
  • Up to 3 days waiting time is expected at Port Liberty Terminal Bayonne.
  • Average gate turn times: 35 minutes for single transactions, and 62 minutes for double transactions.
  • APMT gate will not have a gate open on Saturdays.

 

Norfolk:

  • Currently, most vessels berth on arrival, however, the bigger vessels wait approx. 2 days for a berth.
  • Average gate turn times are 32 / 48 minutes for single and double transactions respectively.
  • Christmas Eve and Christmas day are no-work days.
  • One crane down for routine maintenance.

 

Charleston Terminal:

  • Waiting time for vessel berthing is 0-1.5 days at Wando Welch Terminal and 0 days at North Charleston Terminal.
  • Average truck turn times: 20  minutes at Wando Welch Terminal, and 19 minutes at North Charleston Terminal.
  • Sunday gates are by appointment only.

 

Savannah:

  • Waiting time for vessel berth at the terminal is up to 2 days, depending on the size of the vessel.
  • Average gate turn times are 38 / 55 minutes for single and double transactions respectively.
  • GPA no longer offers a Sunday gate.
  • Monday-Saturday gate hours remain the same.
  • Berth 2 is back online helping to reduce waiting times.

 

Houston:

  • Barbours Cut Terminal has up to 1 day waiting time for vessel berthing.
  • Due to vessel bunching the yard is facing congestion impacting the discharge productivity and extending port stays.
  • Average gate turn time at Barbours Cut Container Terminal is 37 minutes and Bayport Container Terminal is 46 minutes.
  • Loaded import dwell is at 3.5 days.
  • The EC6 service is changing terminal at Houston from Barbours Cut to Bayport effective MV ONE Competence 087E.

 

Oakland:

  • Average wait time of up to 3 days at Oakland Int’l Container Terminal (OICT) and 3 days at TraPac.
  • Average import deliveries can take up to 4.2 days at TraPac and 3.4 days at OICT.
  • Average gate turn times are 61 / 67 minutes for OICT and TraPac respectively.
  • TraPac has received 6 new RTG’s and are in process of commissioning.
  • They are likely to be operational mid-December.
  • Trapac will be closed on December 25, 2023 and January 1, 2024.
  • Dredging operations at OICT berths caused some berthing delays.
  • OICT will be closed on December 24, 25, 31, 2023 and January 1, 2024.

 

Seattle-Tacoma:

  • Wait time of up to 3 days at Tacoma and no waiting time at Seattle.
  • Import deliveries are 4 days at HUSKY – due to EB/WB railcar imbalance, 2.4 days at Washington United Terminal, and 1-3 days at T18.
  • Dwell is dropping and rail companies are mostly caught up.
  • Possible delays with back-to-back vessels discharging this week.
  • Several vessels reported delays due to storms in the Pacific.
  • The average gate turn times are 29 minutes for T18, 28 minutes for Washington United Terminal, and 35 minutes for HUSKY.
  • Terminal 18 and Husky will be closed on December 22, 25, 2023, and January 1, 2024.
  • WUT will be closed on December 25, 2023 and January 1, 2024.

 

Los Angeles/Long Beach:

  • All terminal gates are running as published and in line with the Pier Pass program.
  • Port of Los Angeles dwell time for local import cargo is 3.2 days, on-dock rail dwell is 4.0 days, and import units on the street are averaging at 4.4 /5.9 days for 20 ft and 40+ ft containers respectively.
  • Port of Long Beach dwell times for local imports are stable, and the average terminal gate turn time is between 24-88 minutes, depending on the terminal.

 

Chassis Pools

All pools are operating as normal.

 

Intermodal Operations

Truck power can be secured within 1-3 days for the majority of locations, including marine terminals, rail ramps, and depots.

 

Port Status

Range

Port

Vessels at Anchor

Vs Last Week

Waiting Time

Vs Last Week

PNW

Vancouver

0

-

0

-

PNW

Seattle

0

-

0

-

PSW

Oakland

1

-1

1

-

PSW

LA/LB

0

-

0

-

USEC

New York

0

-

0

-

USEC

Norfolk

0

-2

0

-1

USEC

Charleston

0

-

0

-

USEC

Savannah

1

-4

1

-1

USGC

Miami

0

-

0

-

USGC

Houston

0

-

1

-

Final Thoughts

In light of the latest updates and trends, it is evident that the market is currently in the course of demonstrating robust performance and is equipped with ample capacity and resources.

Individuals and businesses involved in import/export activities must stay well-informed about market dynamics and strategies to make informed decisions. To ensure a smooth and hassle-free experience with your import/export operations, it is recommended to seek guidance from industry experts.

Conduct thorough research on ports that offer available space and suitable equipment despite the ongoing conditions. By doing so, you can minimize complications, facilitate shipments, and maximize efficiency.

Taking proactive measures and staying proactive in your approach will help you navigate the market effectively. We greatly appreciate your continued readership and encourage you to subscribe to our weekly market updates to stay abreast of the latest developments and insights.

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