In recent days, unprecedented torrential rains have caused severe floods in many European countries. Railways and highways have been washed away, freight transport has been suspended, and logistics have been delayed.
Congestion of 328 ships in 116 ports around the world will be affected, and the congestion and rising freight rates will continue into the first half of next year.
The inland container transportation in the United States has been overwhelmed. Many railway operators have adopted compulsory measures. MSC issued a warning.
01 The railway network of many European countries was interrupted due to flooding
A catastrophic flood caused by an unprecedented torrential rain is hitting Europe hard.
From western Germany to Belgium and the Netherlands, several regions in Western Europe have been hit by floods caused by heavy rains.
According to the announcement issued by DB Schenker, due to the damage caused by bad weather, many railway traffic in North Rhine-Westphalia and Rhineland-Palatinate will be delayed and cancelled.
According to Maersk’s announcement, the recent weather conditions in Belgium have caused serious damage to the railway track between Antwerp and Artus. Therefore, the railway between Antwerp and Artus has been temporarily closed and the track is currently being repaired, which is expected to last at least. Three weeks.
The following intermodal railways are temporarily banned:
Rail CY and Rail Combined Athus
Remind you to pay attention to logistics delays and trade risks...
02 Congestion worsens! 328 ships affected by congestion in 116 ports worldwide
Port congestion spread to the world, and more and more container ships on five continents are waiting for berths to dock. A map released by seapexplorer, a container transportation platform created by logistics giant Kuehne+Nagel, highlights the current ultra-high pressure scenes in various container ports around the world.
As of 3:20 pm on the 21st, Singapore time, there are 328 ships stranded in ports around the world, and 116 ports have reported problems such as congestion.
Data from the seapexplorer platform a month ago showed that 304 ships in 101 ports were affected by congestion, and the congestion further intensified. Due to port congestion, up to 10% of global shipping capacity has been consumed.
In the past month, as the backlog of cargo in Yantian in South China has been cleared up, one of the important notable changes is that the number of ships waiting outside the two ports of Los Angeles and Long Beach, the two largest maritime gateways in the United States, has increased by one. Times.
According to the latest statistics, 18 ships lined up off the coast of Los Angeles, waiting for an average of nearly 5 days for berths. According to data from the Pacific Merchant Shipping Association, containers stayed at the Los Angeles-Long Beach Terminal for an average of 4.76 days in June, up from 3.96 days last month.
Mario Cordero, executive director of Long Beach , said that the port will enter the peak import season later this month as retailers restock for back-to-school shopping and year-end holidays. It indicates that it will not be possible until the end of the year to move towards a certain normal state.
Griff Lynch, executive director of the Georgia Port Authority, said that strong demand for imported goods may continue until 2022, as companies scramble to rebuild inventories during the uneven rebound of the epidemic. This situation continues until the Chinese New Year, and there are now many signs that this situation may exceed the Spring Festival.
The container port from Seattle to Charleston, South Carolina has a record high volume of freight this year, and many ports are flooded with cargo, so that ships have to pay for waiting for berths to dock . Tight capacity has pushed ocean freight rates up to four times the pre-pandemic rate.
At the same time, due to the influx of cargo from China, Vietnam and other ports in Asia, the terminals have been overwhelmed, storage space is exhausted, trucks and railroads are tight, and congestion on the west coast has become more serious. Union Pacific temporarily suspended container rail transportation from western ports such as Los Angeles and Long Beach this week to clean up containers near Chicago.
Lars Jensen, founder of Vespucci Maritime, a container consultancy, estimated earlier this month that up to 10% of global shipping capacity has been consumed due to port congestion .
Port performance data from IHS Markit shows that as of May this year, the waiting time for container ships to berth has more than doubled compared to 2019. The situation in North America has deteriorated the most. In May 2021, the average anchoring time of ships was 33 hours, while the average anchoring time in May 2019 was only 8 hours. Data for June and July are not yet available, but the data may deteriorate after the near shutdown of Yantian Port and many railroad disruptions in North America and Europe.
Turloch Mooney, deputy director of maritime and trade at IHS Markit, said: “The situation has not improved and is worrying.” “The reliability of the shipping schedule is still far below the level before the epidemic. Considering the rapid growth of freight volume, many terminals are operating at full capacity, and With the continuing problem of equipment repositioning, it is difficult to see a substantial improvement in the situation in the short term. "
03 The inland container transportation in the United States has been overwhelmed, and many railway operators have adopted compulsory measures
As imports from the United States hit a record high, in order to alleviate the serious congestion in the inland multimodal transport hub and clear the large backlog of containers, the US freight railroad has begun to reduce rail transportation at ports such as Los Angeles, Long Beach and New York.
Since July 18, the largest rail operator in the United States , Union Pacific, has suspended shipping containers from West Coast ports (Los Angeles/Long Beach, Oakland, Seattle and Tacoma) to the inland, especially Chicago, for a period of 7 days. .
Chicago is the largest railroad hub in the United States and has been at the center of congestion on the rail network. There are reports that some containers have been stranded in Chicago for six or seven weeks.
The UP's move by the Union Pacific Railroad is a compelling action for railways to deal with congestion, and other U.S. Tier 1 railway companies have also taken drastic measures.
This month, Norfolk Southern (NS) , a tier one railroad company that mainly serves the east coast of the United States, will significantly reduce the number of containers it receives on its four busy routes , mainly due to lack of chassis and strong demand. Prior to this, NS announced at the end of June that it would cut emergency services in 24 lanes.
The CSX Transportation Company , another tier one railroad company , cut the number of scheduled slots from Bedford to Chicago. In addition, the BNSF Railway Company has set an upper limit for the allocation of transport capacity.
The carrier MSC stated in a service consultation on Monday that starting from last Sunday and in the next two weeks, MSC railroad supplier BNSF will meter and ration incoming trains at the Los Angeles and Long Beach terminals.
MSC stated that the cargo will therefore remain at the terminal until the restrictions are lifted or "weakened", and cargo shipped to Chicago or unloaded from the ship will be affected. "Considering these challenging situations, changing the destination may be difficult,". It also added that BNSF did not set these restrictions in the ports of Oakland and Tacoma.
MSC also pointed out that since last Sunday, an unnamed MSC rail operator has begun to measure traffic from New York to three Midwestern destinations: Chicago, Cleveland and Indianapolis. " If the current situation does not improve, these temporary measures are likely to be extended to other railway operators "
One reflection of the overburdening of the U.S. rail network is the dramatic increase in the number of imported container transshipments from the West Coast to the Midwest. Trucking is also tight, and shippers have reported supplier embargoes, restrictions and surcharges to control capacity , which are often seen in the parcel and LTL industry.
However, the Pacific Merchant Shipping Association (PMSA), which represents the West Coast liner company and marine terminals of the United States, expressed concern about the suspension. PMSA said that the suspension of the plan will increase the current cargo backlog at the terminal , which will cause railway cargo to continue to dock at the terminal, thereby increasing congestion.
Now, inland problems are returning to the port, reversing the port’s efforts to increase productivity and ease congestion. At the Port of Los Angeles/Long Beach, container dwell time and truck turnaround time deteriorated in the latest statistics in May and June. The number of ships at anchor has increased, reaching 18 earlier last week, although the Port of Los Angeles now has 15 container ships per day, compared to 10 per day before Covid-19.
Gene Seroka, CEO of the Port of Los Angeles, pointed out that the peak cargo flow in the early season has arrived, and some retailers have moved ahead to avoid delays. He expects freight volumes to peak from August to October.