Trade & Industry Advisory

11 May 2020 • 7 min read

Ocean Carriers, Capacity Crunch, Panama Canal

Editorial Team

This Week in Ocean Freight. The Panama Canal- This week’s round-up ends with a nice infographic from the people at FreightWaves

This week I was invited to the Rotterdam Partners Red Carpet Diner, where all new international companies that opened offices in Rotterdam were welcomed by Mayor Ahmed Aboutaleb. For a startup like Cogoport, being an innovative digital ocean freight marketplace, Rotterdam is the obvious choice as a location for our European head office. Not only is the Port of Rotterdam the largest in Europe, but it is also among the most innovative in the world.

Also on my mind this week were the two events where I will be speaking at in November.

On November 6 I will be speaking at the Intermodal Europe event in Rotterdam. At 16h10 I will talk about the critical role of container optimization in the era of digital freight. I will focus on the importance of managing empties and how visibility, transparency, and analytics can improve the flow of goods through any supply chain. Register for the event for free here.

On November 7 and 8 I will be speaking at the ICT and Logistics (ICT en Logistiek) event in Utrecht. At 14h45, both days, I will talk about why booking a container should be as easy as booking a hotel, and I will show everybody how this can be done as well. Register for the event for free here.

Be sure to also register for one of my speaking sessions, as the number of seats is limited.

And now on to the news that caught my eye this past week

Capacity Crunch

“North European shippers are scrambling to book space on October sailings to Asia ahead of a new capacity crunch.
The decision by ocean carriers to void 11 voyages from Asia to North Europe nest month to halt the slide in container spot rates will result in a similar number of cancelled backhaul sailings in November and December.”

→Rush for space on Asia-Europe as box carriers spark new capacity crunch

More Surcharges and Carrier Rates

More on surcharges and carrier rates in addition to the items mentioned last week.

“There has been insufficient mainstream publicity on the IMO’s 2020 global emissions regulation for shipping, and a lack of transparency by container lines on their recovery strategies.
These are the worrying conclusions of a review by maritime consultant Alphaliner and a shipper survey by Drewry Supply Chain Advisors.”

→Shippers are being 'left in the dark' as carriers look to recover IMO 2020 costs

“But because the charge is per box, the greater number of revenue-earning boxes sailing west will collectively pay far more than they need to in order to compensate for the same boxes returning east when empty,” observes GSF Secretary General, James Hookham.

He adds that this has the effect of applying higher than average surcharges on their most profitable routes. For example, the Far East to North Europe route has a trade factor of 1.3, but North Europe to Far East of 0.7.”

New ocean cargo surcharges will be foul odor for many global shippers

Top 29 Ocean Carriers

Ok. This item from SupplyChain247 is called Top 35, but 29 of those can be booked through the Cogoport Platform. :-)

Anyway, an interesting read.

“Signs of a turnaround in the prospects of global container shipping companies began surfacing last July when rates began creeping up through the peak season. Overcapacity, however, continues to haunt the industry and may keep it from a sustainable recovery.”

“Given the challenges that all but the top five players have from a cost competitiveness perspective, analysts think that it’s reasonable to assume that there will be some further consolidation. This is in spite of how the sector has distilled into the relatively small number of significant independent carriers today.”

Top 35 Ocean Carriers 2018: Turnaround time?

The Panama Canal

This week’s round-up ends with a nice infographic from the people at FreightWaves.

“The Panama Canal (Spanish: Canal de Panamá) is an artificial 82 km (51 mi) waterway in Panama that connects the Atlantic Ocean with the Pacific Ocean. The canal cuts across the Isthmus of Panama and is a conduit for maritime trade. Canal locks are at each end to lift ships up to Gatun Lake, an artificial lake created to reduce the amount of excavation work required for the canal, 26 m (85 ft) above sea level, and then lower the ships at the other end. The original locks are 34 m (110 ft) wide. A third, wider lane of locks was constructed between September 2007 and May 2016. The expanded canal began commercial operation on June 26, 2016. The new locks allow transit of larger, post-Panamax ships, capable of handling more cargo.[13,000 TEU]”

→ Wikipedia - The Panama Canal

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