We Survived the First Six Months
It's that time again for our monthly newsletter & blog.
We made it halfway through the year! Is it just us or is this year flying by?
I want to kick off the blog by discussing the updates in the local Australian market.
We can expect further landside infrastructure charges. In Brisbane, there is a new full container empty container park called MEDLOG. Their fee for MT containers is $95.00 + GST. Tyne has also increased their price to $90.00 + GST (there was no notice given). These prices were made applicable immediately with no warning to transport operators. As we all know, this will be a domino effect and other park operators will follow suit. Port congestion is starting to ease in Melbourne, Sydney, and Brisbane, however, transport delays and detention are still a significate issue.
Fuel Surcharges have reached a new peak. Currently, you will see surcharges anywhere between 15-27%. We recommend ensuring you are factoring these costs into the price of your products as its not predicted to drop anytime soon.
LCL Slot fees have started to increase, with some depots now charging $25.00 + GST, up from $15.00 + GST at the start of the year.
FTA Alliance has been doing some great work in drawing attention to freight costs, unreasonable container detention practices, and congestion in the Australian empty container parks. Paul Zalai, Director of FTA, has been a fantastic advocate for our industry. You can watch Paul's interview on Sky News here (Starts 19min 48sec / Ends 25min 33sec):
Moving on to the Chinese market.
We are about a month away from peak season ramping up. Lets run through the current state and projections.
Transshipment's out of China via Singapore and Malaysia are still taking significantly longer than anticipated, with lengthy port delays and rolling's. The market remains stable, with expected volumes to only increase mid-August. This means, for now, the container rates should stay fairly stable for the next fortnight, with shipping lines expected to hold off on introducing a general rate increase.
A large contributor to this is the rising inflation rate in Australia, New Zealand, US and Canada. The market is in a settling period of finding its feet with the increased cost of living and wages, however it's not expected to take very long for businesses to find their new normal and for trade to pick back up.
There have been significant delays in vessels departing the main Chinese ports, due to the vessels arriving back into port late from Australia. This has been a significant contributor to the rolling's we have been experiencing.
We now have new LCL offerings ex Dalian, Foshan, Guangzhou, Shunde, Zhongshan & Zhuhai to Australian main ports. Please reach out to us if you would like some pricing. The NOR rate promotions from HMM, ZIM & COSCO are still available, we highly recommend taking advantage of these competitive rates.
Now turning to the US Market.
The US National Weather Service is predicting above-average hurricane activity in the Atlantic this year—which would make it the seventh consecutive above-average hurricane season. The season is predicted to run from June 1st to November 30th. We can expect this to have significant delays on the landside supply chain as the ports and transport operators struggle with the weather.
The Fourth of July falls on a Monday this year, which is a non-operational transport day. This is expected to have minimal effects on the market. Data demonstrates that capacity is less due to businesses and transport operators closing down early to enjoy a long weekend. Please ensure you are booking your freight and transport in advance to ensure secured space.
Shanghai has opened back up after its lockdown and volumes into the US are expected to increase. This is predicted to put notable pressure on the US ports in July, August, and September.
The U.S. House passed the Ocean Shipping Reform Act, with Biden set to sign it into law. This represents the first revamping of U.S. ocean shipping laws going back to 1998. The most significant reforms are:
- prohibiting ocean carriers from unreasonably refusing cargo space;
- promoting transparency by requiring ocean common carriers to report total import/export tonnage;
- authorizing the FMC to self-initiate investigations of ocean common carrier’s business practices and apply enforcement measures;
- establishing new authority for the FMC to register shipping exchanges to improve the negotiation of service contracts;
There is hope that this move by the US government will encourage reform in the Australian market, only time will tell.
Yang Ming and HMM hit by collusion charges in the US - Sam Chambers - Splash247
The new framework of the Federal Government operating at the border - Andrew Hudson - Rigby Cooke
Coronavirus: A lesson in supply chain risk management - Matt Leonard - Supply Chain Dive
Inflation, cost-of-living, supply chains, declining wages, climate impacts, and inequality are leading us towards global unrest - Stan Grant - ABC News
That's a wrap from us.
Please feel free to reach out should you wish to discuss any of the topics we have covered or if we can help to plan out your supply chain requirements for the remainder of the year.
Thank you again for the support, we appreciate your business.
All the best,
Bianca & Steve