For shippers, by a shipping container (and a human named Michael). It’s finally 2023!
Happy New Year! Now, it’s time to get back to business.
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Onward…
📈 BY THE NUMBERS: Important numbers impacting freight and logistics
⛽ Diesel: $4.583 / gal
Data via the U.S. Energy Information Administration – Week of Jan. 2, 2023.
✈️ Air Cargo Index: 192.4 🔽 (November 2022, FRED)
December 2022 index data isn’t released yet – check back soon.
🚢 Global Container Index: $2,246 (Dec. 30, 2022)
🌐TOP STORY: Shanghai remained world’s busiest container terminal in 2022
Chinese state media have reported that the Port of Shanghai was once again the world’s busiest container terminal in 2022, marking a 13-year streak in the top slot.
Despite China’s zero-covid policy, Shanghai International Port Group (SIPG) reports that Shanghai exceeded 47.3 million TEUs during the 2022 calendar year, growing just under 1% (down from 8% growth in 2021).
The port operator added that these records and progress are due to the integration of ports throughout the Yangtze River region. By all standards, the volumes of processed container cargo through Shanghai continues to be sobering news for competing economies hoping to close the export gap.
How did ports in the US and Europe (the world’s #2 and #3 top exporters) compare? The busiest containerized port in Europe is Rotterdam, whose throughput dropped by 8.6% in the first nine months of 2022, and 4.4% in TEU.In North America, the busiest container ports bounce among Los Angeles, Long Beach, and New York-New Jersey. In 2022, the Port of Los Angeles processed 9,182,287.35 TEUs in 2022. The Port of New York and New Jersey saw 8,880,653 TEUs in Nov. 2022 YTD. NYNJ 2022 totals are not posted.
SO WHAT?: The US economy, despite being the largest in the world, and all the trade war hullabaloo, still relies heavily on China. Terminals on either side of the Pacific process the highest global cargo volumes. Especially for the United States, the majority of retail goods imported come through ports based in China and East Asia and transit along the transpacific corridors dominated by American and Chinese ocean operators. We expect the PRC as it has in recent decades – to dominate volume numbers in 2023.
Read more at China Daily and Global Times. The numbers have been confirmed by industry outlet Maritime Executive.
🔍Tennessee trucking company wins D&D case against Evergreen
Taiwan-based carrier Evergreen was handed a defeat by the Federal Maritime Commission just before the new year. One of the commission’s small claims officers upheld a complaint filed by TCW Inc, a trucking carrier in Tennessee, over detention and demurrage (D&D) fees levied by Evergreen. The commission in December issued a rule that requires carriers to only levy D&D charges when the action will encourage the flow of cargo through ports to cargo forwarders. FMC confirmed that the respondent (Evergreen) is now forbidden from “imposing per diem charges on day when a motor carrier has no ability to return equipment due to a port closure; and directs [the] respondent and all marine lines to bill per diem charges directly to the …[beneficial cargo owner] instead of the motor carrier.” German carrier Hapag-Lloyd has opted to wave more than $150,000 in demurrage fees for a forwarding company based in Wisconsin.
📉 XPO downgraded by Bank of America, citing a worsening small freight outlook
The publicly-traded XPO Logistics, a less-than-truckload shipping company, saw its stock downgraded to neutral by the Bank of America – the second largest institutional bank in the United States. On Dec. 30, XPO was trading down by 3.5% in light of the news. This stock downgrade places a negative long-term outlook where partial truck shipping is in a decline.
Read an analysis on the downgrading at MarketBeat.
🕊️ Human rights at sea
One overlooked aspect of the pandemic has been the crisis of crew change restrictions due to public health concerns and the unethical practice of operators abandoning crews. David Hammond of the UK charity Human Rights at Sea, writes for Maritime Executive: “The cause of human rights abuses at sea is the same as on land. And although states (flag, coastal and port) may not always protect people, the abusers must still be held accountable.”
Read the column here.
⚠️ Other stories to read… ⚠️
- Human & Labor Rights: “Denmark Reaffirms Support For the Philippines Efforts On International Maritime Compliance” – Marine Insight
- Ports: “Some supply chain managers are wary of shifting trade back to West Coast ports” – CNBC.com
- Supply Chains: “Top disruptions that shook supply chains in 2022” – Supply Chain Dive
- Krugman: “The Football Game Theory of Inflation” – The New York Times
- Inflation: “Global hedge funds plan 2023 around inflation risk” – Reuters via Y! Finance
- Inflation: “The Rise of Undocumented Inflation” – The American Prospect
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The current edition of our newsletter was written by Michael M., Freight Forwarding Weekly’s chief news analyst. Do you have a tip or do you want us to cover something? Tell us by replying.