The multimodal network news digest - issue #21

Continuous slide of the freight rates is expected to bring them to the pre-COVID level. Shanghai-North Europe freight rates dropped to $2,350/TEU. Shanghai-US East Coast rate is at $3,900/FEU. There are also declines in rates from Shanghai to the Persian Gulf, South America, and Australia.

China, one of the most important countries for shipping demand, has significantly slowed down its industrial growth because of its zero-COVID policy which will have consequences for businesses worldwide. China’s dry bulk commodity import demand has declined by 4.7% year-on-year to 1.6bn tonnes. Moreover, the country’s container volumes have reportedly fallen by -22% year over year. 

Trying to halter the drop in rates on trade lanes, companies are scheduling more blank sailings to reduce capacity (for example on the eastbound trans-Pacific trade lane.)  However, these steps may not be enough. Liners will idle. In fact, experts predict that idling will reach approximately 1.5m TEU in 2023, or roughly 6% of the end-2022 cellular fleet.

When it comes to carriers, contracts no longer seem to be important anymore, some experts admit. The problem is that they were set high when the carriers tried to lock in shippers on extended deals, but now when the market pivots so unexpectedly, shipping on contracts becomes unsustainable. 

Truckers’ strike in South Korea has caused disruptions, in particular, interrupting deliveries of raw and semi-finished materials. 

In Austria, a strike is looming over the horizon. All trains will be stopped on Monday unless another decision is made during the negotiations. 

Routes and services 

• Maersk has added a weekly rail service, the ‘Pratigya Express’, from Sonipat Inland Container Depot to APM Terminals Pipavav Port. 
• Ukrainian Railways will add 6 additional border crossings for rail freight to Europe: 3 facilities will be added on the border with Poland (Rawa-Ruska, Grebenne, and Starzhava – Krostsenko), 2 - on the border with Romania (the Delovo-Valea Visheului section), and 1 on the border with Moldova (at Berezino – Basarabeasca). 
• Ningbo-Zhoushan Port has opened a new sea-rail transport service to export new energy vehicles. 
• The terminals Malaszewicze and Biała Podlaska near the border with Belarus will have more capacity thanks to 13 new additional tracks. It will help to handle longer and heavier trains. 

Other 

• South Carolina Ports have completed the rail expansion at Inland Port Greer by adding 8,000 feet of new rail to meet cargo demands through 2040. The next phase will be about the expansion of the container yard. The completion of the project is scheduled for 2024. 
• After two years, the boxship backlog at Port of Long Beach, Port of Los Angeles has come to an end. No vessels are queuing anymore. 
• MSC withdrew from the plan to acquire ITA Airways.
• Rail Cargo Group will expand with a new branch and a new carrier in Serbia and China in 2023. By doing it in Serbia, the company will be able to offer connections towards Turkey and Greece via two alternative routes. 

These are only several changes that occurred in more than 250 bn freight rates across 25 million routes with more than 1 million market players. Want to share some news about your company, services, and routes? Just post them on MAXMODAL, a multimodal network that digitally connects routes and rates worldwide to automate sales and operations across container transportation & logistics industry. Join to innovate.