BRi Global - News Update 25th June 2021
Dear all Valued Customers
US West Coast Ports Prepare for Elevated Peak Season Imports
Over the past couple of months, the congestion at the ports of Los Angeles and Long Beach - the main US west coast gateway - has eased and vessel turn times improved. However, shippers may see renewed strain on the ports and their rail and truck networks as peak season looms.
For ten consecutive months, the port complex has handled record or near-record volumes of imports: in May, LA processed 1,012,048 TEU, the first time a port in the western hemisphere handled more than a million TEU in a month. Total US-bound containerized shipments were up 47.1% on a year ago according to recent data. Imports from China climbed 51.1% year on year, while imports from the rest of Asia increased 44.5%.
Despite the record setting imports, turn times at the docks and truck time at Los Angeles and Long Beach have improved since January. Unfortunately, the respite may be short lived as two new carriers announced plans to bring their services to the port complex and HMM plans to boost its transpacific sailings.
Carriers and shippers are both preparing for the influx of goods that peak season is known for. However, extenuating circumstances including a fast growing US economy, the waning pandemic, and recovery from Yantian’ s closure is expected to further fuel imports this season.
As more cargo pours in from Asia, port executives warn that the congestion is not solely the fault of port's capacity, but also a result of strain on the entire supply chain network extending far into the interior US as well.
Chicago Rail Terminal Struggles to Handle Record Freight
Union Pacific Railroad’s (UP’s) Global IV terminal in Joliet, Illinois is struggling to handle more ocean containers than it has ever seen during springtime come into the Midwest. Drayman and truckers say it is the worst congestion in history, as an estimate of 1,500 to 2,500 containers are stacked and inaccessible - while still subject to rail storage fees.
In some cases, UP has been unable to tell importers where their containers were located or when they would be available for pick up.
In an effort to work through the congestion, trucking companies have offered to use their own chassis as a temporary solution until the intermodal equipment providers (IEPs) — TRAC, DCLI, and Flexi-Van Leasing — can supply enough chassis, but UP has refused these overtures under its “no cherry-picking” policy, while also not waiving fees.
Biden Strikes Deal on $1 Trillion Infrastructure Package
After meeting with a group of 10 senators at the White House, President Joe Biden agreed on Thursday to a $1 trillion infrastructure package.
Details of the deal’s framework have not been made public since the package was announced earlier this month, but it reportedly includes more than $550 billion in new spending on roads, bridges and other traditional infrastructure projects. Now, the agreement must go to Capitol Hill for official approval.
Hapag-Lloyd Adds Six Mega-Ships to Growing Orderbook
Hapag-Lloyd has ordered another six 23,500 TEU ships at a cost of $852 million as the carrier continues to build out its capacity of ultra large container ships, with 12 of the giant vessels now on the orderbook to be delivered through 2023 and 2024.
The six ships, as with the six 23,500 TEU vessels ordered late last year, will be able to run on either conventional fuel or liquefied natural gas (LNG) and will be deployed on the Asia-Europe trade to serve routes covered by THE Alliance of Hapag-Lloyd, Yang Ming, HMM, and Ocean Network Express, Hapag-Lloyd said in a statement Tuesday.
Egypt Expects Ever Given Compensation Deal Signing Next Week
Egypt expects to finalize an agreement next week for compensation over the giant ship that blocked the Suez Canal in March, according to the waterway’s top official.
The Suez Canal Authority will sign a deal with the owners and insurers of the Ever Given vessel around the middle of next week, SCA Chairman Osama Rabie said to local television late Wednesday. Egypt had initially sought over $900 million—a figure that was subsequently amended to $550 million. Japan’s Shoei Kisen Kaisha Ltd., the owner, and the ship’s insurers initially offered $150 million.
The SCA’s compensation claim covered the loss of transit fees, damage to the waterway during the salvage efforts, and the cost of equipment and labour.
Keeping you updated,
BRi Customer Solutions Team
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