Gemini's hub-and-spoke strategy will 'fuel demand for feeder vessels'
Non-operating feeder containership owner MPC Containerships (MPCC) said this week it was “looking forward” to ...
AMZN: APPEAL UPDATEDSV: PRESSURE BUILDS AAPL: OPENAI FUNDING INTERESTCHRW: ANOTHER INSIDER CASHES INHLAG: GRI DISCLOSUREMAERSK: HOVERING AROUND FOUR-MONTH LOWSTSLA: CHINA COMPETITIONDHL: BOLT-ON DEAL TALKAMZN: NEW ZEALAND PROJECTDHL: SURCHARGE RISKKNIN: LEGAL RISKF: 'DEI' HURDLESPLD: RATING UPDATEXOM: DISPOSALS
AMZN: APPEAL UPDATEDSV: PRESSURE BUILDS AAPL: OPENAI FUNDING INTERESTCHRW: ANOTHER INSIDER CASHES INHLAG: GRI DISCLOSUREMAERSK: HOVERING AROUND FOUR-MONTH LOWSTSLA: CHINA COMPETITIONDHL: BOLT-ON DEAL TALKAMZN: NEW ZEALAND PROJECTDHL: SURCHARGE RISKKNIN: LEGAL RISKF: 'DEI' HURDLESPLD: RATING UPDATEXOM: DISPOSALS
Two more container lines have suspended expedited services through the US port of Oakland.
They are following in the footsteps of Zim, which was forced to divert the inaugural sailing of its Central China E-Commerce Express to Los Angeles and will continue in this vein for the time being.
CMA CGM, the first carrier to launch a fast transpacific service calling at Oakland in North America earlier this year, is alternating calls at Oakland and Seattle through August, while Hapag-Lloyd is suspending Oakland calls and says it intends to return in mid-August, if the congestion there has cleared.
At the end of last month there were 10 vessels waiting for berth space at Oakland, with another 15 ships approaching. According to Maersk, wait times were up to three weeks – worse than at the Los Angeles/Long Beach gateway complex.
Traffic through Oakland was going through the roof. In April, the port handled 100,096 teu of import cargo, the first time it broke through the 100,000-box barrier in its history, but the increased volume was met by reduced capacity.
According to the port authority, the two main reasons for the congestion have been a shortage of labour and the temporary loss of one of its four berths, which had been occupied with the arrival of three new post-panamax cranes, the tallest currently deployed on the west coast.
Robert Bernardo, acting director of communication, said the cranes became fully operational last week, so all berths were available again to handle traffic.
But he added: “The big issue is getting more workers to handle the record-breaking cargo levels.”
He said the port authority had been informed by the Pacific Maritime Association that its members had hired hundreds of new workers, who are now undergoing training for skilled positions.
“We expect to see an improvement in overall maritime operations in the coming days and months,” he declared.
The direct sailings from China – the first for Oakland – were designed to offer a faster alternative to Los Angeles and Long Beach, which have been mired in congestion for months. As such, they were well received in the market.
“Zim was promising, and we felt it would be a good alternative,” said Bob Imbriani, vice-president international services of forwarder Team Worldwide. “However, it has not materialised.”
CMA CGM’s Golden Gate Bridge Service was oversubscribed, noted Craig Grossgart, senior VP global ocean of Seko Logistics. “The ships were about 7,000 teu and we could have filled 14,000 teu ships easily,” he said.
However, he reckons that in normal market conditions, two expedited services into Oakland would be too much, as a lot of the demand has come in response to the congestion in southern California.
Mr Grossgart said there were still expedited services from China (defined as having paid-for priority berthing in Asia and steaming at 21-plus knots). Matson, which runs two strings from Ningbo and Shanghai to Los Angeles, and CMA CGM have more or less dedicated terminals at the US port to guarantee fast handling.
However, he has doubts about the speed on the Asian side at this point.
“Even with priority berthing I’d be surprised that any of the vessels get a berth on arrival in Ningbo or Shanghai. There are simply too many vessels waiting in the anchorage to allow for this,” he said.
In its weekly update, Freightos noted yesterday that the port of Yantian, which handles about 25% of US-bound Chinese-origin ocean volumes, had been operating at 30% capacity for over two weeks. And in many locations, ports are unable to handle the elevated volumes.
“The Yantian crisis is contributing to delays and tied-up capacity already plaguing the industry, pushing the share of global capacity currently waiting outside a port to more than 5%,” wrote Freightos research lead Judah Levine. He added that this had pushed spot rates higher still this week.
But, for all their magnitude and impact, congested ports are only part of the problem, believes Mr Imbriani.
“The problem is that no one carrier, or one or two additional sailings to alternate ports, will solve the problem. It may help, but not eliminate it. Remember we will still have ground handling and drayage problems regardless of the port and at origin equipment issues.
“It will take a co-ordinated effort between all carriers, terminal operators, port authorities, drayage and rail companies to build a lasting solution. We continue to explore all possible options to include carriers, ports of origin, ports of destination, trans-loading upon import and much more,” he said.
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