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Descartes releases January report on global shipping crisis

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Descartes releases January report on global shipping crisis. Image: Pixabay
Descartes releases January report on global shipping crisis. Image: Pixabay
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Descartes Systems Group, the global leader in uniting logistics-intensive businesses in commerce, released its January report on the ongoing global shipping crisis and analysis for logistics and supply chain professionals. The report shows continued strong U.S. ocean container import volumes and economic indicators, which may point to similar levels of disruption for global supply chains in 2022 as in 2021.

While December was the second month in a row with declining container import volumes (see Figure 1), compared to December 2020 and pre-pandemic December 2019, it was still a record month with volumes up 1% and 25%, respectively. From a pattern perspective, the November/December decline is similar to 2019. Looking at year-over-year container import volumes, 2021 was 18% higher than 2020 and 22% higher than 2019. When considering the extent of the container import increase and the fact that higher volumes have persisted for 18 months, the chronic supply chain disruption that has ensued should not be surprising.

“In the U.S., consumer behavior driving a high ratio of goods to services expenditures (see Figure 2) is the fundamental driver of the current situation and doesn’t appear to be changing,” said Chris Jones, EVP Industry & Services at Descartes. “The new coronavirus variants are having multiple impacts keeping consumers from spending on services as opposed to goods and exacerbating existing resource shortages and the ability to move good efficiently. We believe 2022 is shaping up to be another congested and frustrating year for global supply chains and importers and logistics services providers need to view this as a longer-term situation and plan accordingly.

 

 

Descartes releases January report on global shipping crisis. Image: Descartes

Descartes releases January report on global shipping crisis. Image: Descartes

 

Descartes releases January report on global shipping crisis. Image: Descartes

Descartes releases January report on global shipping crisis. Image: Descartes

 

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Container Shipping Lines

Maersk and MSC to terminate 2M alliance in 2025

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Maersk and MSC to terminate 2M alliance in 2025. Image: Maersk
Maersk and MSC to terminate 2M alliance in 2025. Image: Maersk
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MSC Mediterranean Shipping Company and Maersk A/S, an entity under A.P. Moller – Maersk, have mutually agreed to terminate, effective in January 2025, the present 2M alliance.

In a joint statement, CEO Vincent Clerc of A. P. Moller – Maersk, and CEO Soren Toft of MSC say, “MSC and Maersk recognize that much has changed since the two companies signed the 10-year agreement in 2015. Discontinuing the 2M alliance paves the way for both companies to continue to pursue their individual strategies.”

He continues, “We have very much appreciated the partnership and look forward to a continued strong collaboration throughout the remainder of the agreement period. We remain fully committed to delivering on the 2M alliance’s services to customers of MSC and Maersk.”

The announcement has no immediate impact on the services provided to customers using the 2M trades. Each company’s customer teams will communicate with their respective clients to support during, and beyond, the phase-out of the 2M alliance.

Background information about the 2M alliance:

  • 2M is a container shipping line vessel sharing agreement (VSA)
  • It was introduced in 2015 by the two companies with the aim of ensuring competitive and cost-efficient operations on the Asia-Europe,
  • Transatlantic and Transpacific trades
  • The 2M agreement has a minimum term of 10 years with a 2-year notice period of termination

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Container Shipping Lines

Mawani announces addition of Indamex 2 shipping service

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Mawani announces addition of Indamex 2 shipping service. Image: Saudi Ports Authority
Mawani announces addition of Indamex 2 shipping service. Image: Saudi Ports Authority
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The Saudi Ports Authority has announced the addition of the Indamex 2 shipping service, a route jointly operated by global container liners Hapag-Lloyd and CMA CGM, to Jeddah Islamic Port.

The trade link is key to the Kingdom’s ambitions in positioning Jeddah as a major east-west hub and strengthening its global maritime connectivity in line with the goals of the National Transport and Logistics Strategy.

The Kingdom’s busiest port will gain access to leading trade gateways across the Indian Subcontinent and North America, including Port Qasim in Pakistan, Mundra and Jawaharlal Nehru in India, and Norfolk, Charleston, and Savannah in the United States.

The first sailing on the new shipping service had left the Red Sea port on the 11 th of January on board MV. SWANSEA V. 006W, a vessel that has a carrying capacity of 4600-6966 TEUs. Over the course of last year, the nation’s hubs have added up to 9 shipping services in a bid to boost the Kingdom’s ranking in the global logistics indices and multiply the sector’s current throughput capacity.

Jeddah Islamic Port remains the region’s prime maritime and transshipment hub, receiving around three- fourths of the Kingdom’s seaborne trade and transshipment volumes across its 62 multipurpose berths designed to handle containers, general cargo, livestock, passengers, bulk grain, and automobiles. With a capacity spanning 130 million tons, the port is home to state-of-the-art infrastructure that comprises four cargo and container terminals, a bonded storage and re-export zone, storage yards, and warehouses.

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Container Shipping Lines

Ocean Network Express to acquire TraPac and Yusen Terminals

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Ocean Network Express to acquire TraPac and Yusen Terminals. Image; ONE
Ocean Network Express to acquire TraPac and Yusen Terminals. Image; ONE
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Ocean Network Express has signed definitive agreements to acquire a 51% stake in each of TraPac LLC and Yusen Terminals LLC, currently held by Mitsui O.S.K. Lines, Ltd. and Nippon Yusen Kabushiki Kaisha respectively. TraPac is a container terminal operator and vessel stevedore that provides container terminal services in Los Angeles and Oakland. YTI is a container terminal operator and vessel stevedore that provides container terminal services in Los Angeles.

These acquisitions are part of the integration of the container shipping businesses from the parent companies into ONE. The recent disruptions to the supply chain due to Covid-19 have highlighted the importance container terminals play in keeping global trade flowing. The newly acquired container terminals will safeguard ONE’s access to terminal capacity in key and strategic gateways, support its growth ambitions and enhance its service offerings to customers.

The closing of these transactions is subject to the approval of the relevant authorities.

Ocean Network Express was established on July 7, 2017 by the integration of ‘K’ Line, MOL and NYK.

Their fleet size is 1,505,181 TEU which is the 7th largest in the world. Operations will be performed through a fleet of 205 vessels, including 35 super-large ships, such as the world largest 20,000TEU container-ships, in a service network covering over 120 countries around the world. ONE will further expand the number of ports in the future to Asia, North America, Europe, the Mediterranean Sea and the Middle East, also planning to expand our direct service to perform a wide service coverage.

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