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Idle containership fleet set to hit 3m teu – Alphaliner
The idle containership fleet is expected to breach the 3m teu mark as lines blank more sailings and withdraw services according to analyst Alphaliner.
In its weekly newsletter Alphaliner said that with more than 250 scheduled sailings being withdrawn by container lines in Q2 due to the COVID-19 pandemic hitting demand the inactive fleet would surge past the 3m teu mark surpassing a previous high of 2.46m teu in early March.
“No market segment will be spared, with capacity cuts announced across almost all key routes. Apart from the Asia - Europe, Asia - North America and Transatlantic routes, carriers have also implemented capacity reductions in South America, the Middle East, the Indian Subcontinent, Africa, and Oceania,” Alphaliner said.
“While the larger ships will be cascaded to replace smaller units on the remaining strings, carriers will be forced to idle a large part of their operated tonnage. This will affect all size segments in the coming weeks.”
Nearly a third of the inactive fleet is in yards for scrubber retrofits with Alphaliner saying 1.02m teu of capacity is in yards for such installations at present.
THE Alliance merging services, blanking 28 sailings in May/June
THE Alliance has set out capacity cuts for May and June including the merger of services, suspensions and blanked sailings due to lower demand caused by the COVID-19 pandemic.
The latest cuts by THE Alliance, which comprises Hapag-Lloyd, Hyundai Merchant Marine (HMM), Ocean Network Express (ONE) and Yang Ming, follow on from 20 blanked sailings in April.
An announcement by ONE said that the FE2 and FE4 Asia – North Europe services would be merged for weeks 19 – 26 to become FE2 with North Europe ports on the service subject berth window availability.
On the transpacific the PS5 loop would be suspended for weeks 19 – 26, and on the transpacific – East Coast route via Suez and Panama Canals the EC3 service would remain merged with EC1.
A total of 28 services will be blanked on the Asia – Med and transpacific trades during in the two month period and these are listed below this article.
On the Asia – Middle East trade the AG1 and AG3 loops will be combined between weeks 19 and 26 with a rotation of: Qingdao – Pusan – Shanghai – Ningbo – Kaohsiung – Shekou – Singapore – Jebel Ali – Dammam – Hamad – Jubail – Abu Dhabi – Sohar – Port Kelang – Singapore – Hong Kong – Qingdao.
Meanwhile a call in Xiamen will be added to the westbound leg of the AG2 loop.
“Despite the above-mentioned adjustments, the members of THE Alliance are committed to deliver reliable services to our respective customers and provide alternative solutions to keep supply chains moving. The affected services are expected to resume normal operation dependent on market conditions,” the lines said.
Blanked sailings –
Asia and the Mediterranean
Week 19 – MD1 and MD3 void
Week 20 – MD2 void
Week 21 – MD1 void
Week 22 – MD2 and MD3 void
Week 23 – MD1 void
Week 24 – MD2 and MD3 void
Week 25 – MD1 void
Week 26 – MD2 void
Transpacific – West Coast
Week 19 – PS3, PN3 and PN4 void
Week 20 – PS4 void
Week 21 – PS3, PN3 and PN4 void
Week 22 – PS4 void
Week 23 – PS3, PN3 and PN4 void
Week 24 – PS4 void
Week 25 – PS3, PN3 and PN4 void
Week 26 – PS4 void
COVID-19: the CMA CGM Group builds a logistical bridge to supply France with urgent medical equipment
Thanks to its control of the entire transportation chain, the CMA CGM Group and its subsidiary CEVA Logistics are building a logistical bridge between China and France.
The first two shipments of masks and medical supplies arrive in France on Thursday, April 9th and Friday, April 10th. A 600 m3 plane fully chartered by the Group will follow on Sunday, April 12th. Twenty million masks as well as medical supplies will therefore be delivered to France in 4 days.
The CMA CGM Group pursues its commitment to supply France with medical equipment
CEVA Logistics will then charter two flights every week to fight the COVID-19 pandemic in France. The masks and medical supplies transported by the Group will be distributed to hospitals, nursing homes, local authorities and businesses, particularly in retail.
Present in over 160 countries, the CMA CGM Group is also taking action around the world. In particular, CEVA Logistics is contributing to the logistical bridge arranged from China to the United States and to Latin America.
An extraordinary mobilization made possible by the expertise of the Group and the commitment of its employees
The CMA CGM Group and its subsidiary CEVA Logistics deliver masks and medical supplies in very short time frames, from the moment goods are accepted until they are handed over to the final recipients:
• Collection and pre-carriage from factories in China
• Transportation to CEVA warehouses in China and packaging
• Delivery to airports and chartering of flights
• Loading, unloading and customs clearance in France
• Dispatch and mobilization of the transportation system to ensure delivery to final recipients.
CMA CGM Group employees continue to mobilise on a daily basis to ensure the ocean transportation and delivery of essential goods, particularly food, medical and pharmaceutical products, in France and around the world.
Rodolphe Saadé, Chairman and Chief Executive Officer of the CMA CGM Group, states: “This unprecedented logistical bridge will supply health products to France in a very short time frame, and thereby help confront the current emergency. As a French company with a global presence, it is incumbent upon us to apply all our expertise to help in these times of crisis. This complex logistics operation was made possible thanks to the mobilization of all Group employees who are accomplishing a remarkable human achievement.”
Main container lines face $23bn loss in 2020 under ‘worst case’ scenario
The impact of the novel coronavirus (COVID-19) could cause main carriers to collectively lose a staggering $23bn in 2020 under a “worst case” scenario, according to analyst Sea-Intelligence.
Alan Murphy, ceo of Sea-Intelligence, said carriers may see freight rates decline to the same degree they had experienced during the financial crisis of 2009.
Sea-Intelligence observed that within the past week (week 14), the number of blank deepsea sailings has increased from 45 to 212. The majority of blank sailings are clustered within the coming five to six weeks amid multiple services with cancellations ranging through to the end of June.
The largest capacity withdrawal is seen in the Asia-Europe trade where the market is now entering a four-week period with 29-34% of the capacity having been removed from the market.
For this week (week 15), Asia-Europe’s share of capacity being blanked is projected at 18%, with further forecast of increased blank capacity at 29% for week 16, 34% for week 17 and 18, 30% for week 19, 22% for week 20, 15% for week 21, before dipping below 10% for the weeks until week 25 (mid-June).
“The financial impact on the carriers could also be profound, although the magnitude to a large degree depends on the carriers’ pricing discipline going forward,” Murphy commented.
With the worst case scenario being a collective loss of $23bn in 2020, the most benign scenario on the other hand will see carriers experience a 10% volume decline this year, but manage to prevent any material decline in freight rates.
“In this case their profits will decline by $6bn compared to 2019 and cause all main carriers combined to lose $0.8bn in 2020,” Murphy said.
“It is therefore clear that the primary purpose of the capacity reductions should be seen as an effort to prevent a catastrophic drop in rate levels. The cost savings are also important, as they too are measured in the billions, but pale in comparison to the impact declining rate levels will have,” he added.
Murphy said the development in freight rates will be crucial in the coming weeks as that will determine the degree of capacity reductions.
Container volume at major Chinese ports dropped last weekThe container volume of China’s eight major ports declined 4.4% for the past week, which is the first weekly decline since the middle of February this year.
Affected by the shortage of cargo resources, the average container cargo volume at major Chinese ports declined in the past week, especially the ports at Pearl river delta. Recent weeks have seen major lines starting to blank large numbers of sailings between Asia and Europe/US as the COVID-19 pandemic impacts demand in Western countries.
Meanwhile, the three hub ports along Yangtze river, Nanjing, Wuhan and Chongqing’s cargo throughput kept growth last week and posted an increase of 9.5%.
As the end of 1 April, the berth resumption ratio of Wuhan, the epicentre of the orginal outbreak, reached 100%, and the cargo volume recovered to 60% comparing to the same period of last year.
China Ports & Harbors Association warns severe challenges on container sector due to the spread of COVID-19 globally. The association forecasts 10%-15% decline of container throughput at foreign-trading hub ports in the second quarter of this year.
(Source: World Maritime News, American Shipper, Seatrade Maritime)
