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News digest. 1 Sept

It is all “fun and talks” until it escalates — the tension between China and Lithuania is growing. Intermodal still remains the industry’s last hope as ports are drowning in surging volumes. 

The threat of possible cease of railway connections between China and Lithuania has been looming over for a while now, and things are getting only more unclear. Although no official statements have been made, some companies are already taking a pause in ongoing projects until political stability is back. In this context, the Kaunas Intermodal Terminal will play a crucial role in Baltic and European rail freight.

Overall, European intermodal terminals remain a valuable asset for development. It is difficult to choose only one when it comes to evaluating their potential as new candidates keep appearing in the intermodal race. In particular, Luxemburg is currently in the spotlight as an aspiring  powerful hub — CFL Multimodal is planning to expand its operations in Europe and the New Silk Road. Poland is another alternative with great possibilities, however, there are several issues such as the imbalance between east and westbound flows that make intermodal development challenging. It is prime time to get onto an intermodal train, especially in the Chinese direction. The updates have shown that there is a 35.5% increase for train trips and a 44.6% surge in TEU handled, year on year on China-Europe route.

American ports continue struggling with no ease in sight. Import values are surging at an unprecedented pace. Experts project import volumes of 190,937 TEUs for the week of Sept. 12-18. Paired with low inventories and ships still queening, it is almost bringing the situation on the verge of collapse. The government, in turn, has appointed the port envoy to tackle the congestion problem. The blockages and gloomy forecasts have already forced the 2M Alliance to reschedule its Asia to US and Canada services. 

No wonder that MSC is going to push up rates in Europefor upcoming September. In addition, it will push up its prices by $200 per dry and HC unit, for all export shipments from the Southern Africa Region.

COVID crise followed by the devastating consequences have been extremely harmful for every industry. Airlines all together have lost $6.9 bil. in spring 2021, and although traveling is recovering, not everyone shares optimistic mood. Recently, the EU recommended to re-impose travel restrictions to omit the new COVID waves, so the companies should not take off their armor too early. 

Chinese ports have seen it all: pandemic outbreaks, severe weather conditions, disrupted supply chains — the list goes on. Meanwhile, the container throughput has increased year-on-year by 12.4% from January to July 2021. The average freight rate of a 40 ft container from Ningbo Port, where congestion has slightly eased its grip, to Los Angeles port in August was $6559, an increase of 15.3% compared to July 2021 levels. 

The crisis has clearly demonstrated how truly different the companies are when it comes to addressing the challenges. The industry has already witnessed a trend of the big players vigorously expanding their fleet to tackle the problem of capacity shortage. Hapag-Lloyd pushes through and makes a new order of 75,000 TEU  dry boxes in order to ease the scarcity of empty containers through the new order.

DP World is on the roll of advancing its initiative with the government of Bangladesh  regarding the construction of Bangladesh’s largest rail container depot in Gazipur district. Shippers are currently dependent on trucks, so when the facility is complete, it will majorly boost efficiency of the operations. DP World had already expressed interest to invest US$1 billion in Bangladesh’s logistics sector including the Bay Terminal in Chittagong.

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News digest. 1 Sept

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