Tag Archives: container shipping

New container imbalance fee to minimise congestion due to excess empty containers

Posted on August 3, 2022 by | 1 comment

Port Authority of NY and NJ have announced a new container fee payable by ocean carriers. The fee will be levied when the outbound containers don’t exceed inbound containers by 110% in the same period. The port authority also plans to find additional space to store containers near the port, and already has identified 12 acres on the port.

It seems that these two measures are what works to reduce congestion. The same two kinds of measures were invoked at the Port of LA and Port of Long Beach to get ocean lines to start moving empties out. In California, though, the container fees were just threatened; they never were begun. that alone was enough for ocean carriers to start moving containers out.

Perhaps we have found a credible set of options to get container carriers to move those boxes.

Kim BiggarAugust 3, 2022

Port Authority of NY and NJ announces new container imbalance fee to minimise congestion due to excess empty containers – Splash247

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Carriers ‘must commit to berthing windows’

Posted on July 31, 2022 by | 1 comment

Terminal congestion in Europe is high, even though there are fewer containers being handled than a year ago.

Ocean carriers handle congestion by skipping calls, and landing the containers at smaller ports, then sending them by land to their final destination. Skipping calls fouls up schedules for everyone, and makes it impossible to plan for increased capacity. It’s a nightmare situation for port terminal scheduling and for much of the hinterland service logistics, such as barge, rail and truck.

Another source of congestion is containers sitting in ports, often empty, awaiting movement elsewhere.

Almost everyone believes ocean carriers ought to improve on keeping schedules and sailing when they planned, meeting commitments made in advance to the terminals they intend to stop at. When there’s little excess capacity, altering schedules throws all the downstream logistics plans out of whack. It is like a bullwhip effect; when a ship skips, all the efforts planned to handle those cargoes is wasted, and has to be reorganized as best it can for what is believed to be the next round of deliveries. Keeping entire supply chains in a quandary does not lead to efficient logistics in the hinterland.

Ocean carriers are averaging about 30-40% ontime deliveries right now, and their on-time percentage has been excruciatingly low for a couple of years. No land-based logistics service could stay in business with these kinds of numbers.

In order to get ocean carriers to commit to scheduled berthings, ports are going to have to share information about berth window schedules. If this data were more public, comparisons could be made and carriers that routinely missed their slots could be penalized by getting deferred when they wanted to berth elsewhere. Getting liners to commit to berthing schedules requires cooperation among ports.

By Mike Wackett 27/07/2022

Carriers ‘must commit to berthing windows’ as N Europe ports see volumes fall – The Loadstar

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Container glut pushes down second-hand prices, but carriers still ordering new

Posted on July 20, 2022 by | 1 comment

There are now too many containers in the world. And they are cluttering up the ports and yards we need to move containers through. And they cause detention and demurrage charges, because lines won’t move them out of ports.

The global container pool is around 50 million TEU right now. According to Drewry, that is an excess of 6 million TEU. However, Drewry is not too concerned about the excess at present, feeling they can be absorbed if trade picks up. Interestingly, Drewry seems to think that the excess will be absorbed by ‘slower sailing’!

As economics tells us to expect, the price of second-hand containers is falling. However, some carriers, such as Evergreen, continue to order more. Most containers are built in China these days. Three Chinese firms, with state connections, are the primary sources. The problem is that empty used containers cost a lot to return to exporting destinations. They displace paying cargo, forcing ocean carriers to use space to carry them. And especially, with the cost of bunker fuel in the stratosphere, and the need to use very low sulfur fuel in some busy port areas, the transportation cost is high. Ocean carriers have to ‘bundle’ the cost of returns into the one-way cost of the loaded shipment. Either that, or they take a hit by moving the old containers back.

The Seatrade article by Gary Howard has nice graphs showing the average price of 40-foot used containers in Europe, and in China, provided by Container xChange. Again the question of where excess containers will be stored is raised. There haven’t been many answers to that one yet.

By Martina Li in Taiwan 19/07/2022

Container glut pushes down second-hand prices, but carriers still ordering new – The Loadstar
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Gary Howard | Jul 19, 2022

6m teu oversupply of containers after ‘reactionary’ ordering

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