Newsletter – June 23, 2020

AIR FREIGHT UPDATES

After its ‘moment in the sun’, air cargo will be back to its former ‘grim realities’

theloadstar.com

Rapidly declining air freight rates and increasing passenger flights – with belly capacity – are set to see many of the new ‘passenger-freighter’ operators leave the market.

Both Cathay Pacific and Lufthansa Cargo have already acknowledged that the ‘preighter’ peak was in May, and that June would see far lower levels. Read more here.

OCEAN FREIGHT UPDATES

Blank sailing strategy could bring carriers $9bn profit this year, says consultant

theloadstar.com

Notwithstanding a significant decline in container liftings as a consequence of the global pandemic, ocean carriers have confounded the dire predictions of analysts with their more optimistic outlook for earnings.

Sea-Intelligence, which only a few weeks ago predicted a worst-case annual loss for the liner industry of $23bn, said that, based on its remodelling, the carriers could potentially achieve a profit for the year “in excess of $9bn”. Read more here.

Maersk sets $500 misdeclaration fee for wrongly-sized out-of-gauge cargo

theloadstar.com

In a further effort to crack down on misdeclared cargo, Maersk Line will introduce a $500 fee for special and out-of-gauge cargo if the actual dimensions of the cargo differ from booking details.

Maersk has warned shippers that, from 1 July, even if the actual sizes differ from booked dimensions by as little as a few centimetres, the fee will be applied. Read more here.

MOL goes on the defensive as it prepares for the post-Covid era, slashing fleet by 5%

splash247.com

Mitsui OSK Lines (MOL), Japan’s largest shipowner by fleet size, has issued a new business plan to cope with slashed world trade in the years ahead following the damage wrought to the global economy by the coronavirus.

MOL will reduce its holdings by 40 ships – equivalent to around 5% of its fleet – with tankers, bulkers and car carriers all set to be offloaded. The company is also planning to dispose of non-core assets including real estate as it prepares to get through one of its toughest periods in its 136-year history. Read more here.

Harsh reversal of fortune for containership owners as charter rates tumble

theloadstar.com

Ocean carrier optimism is being driven by higher freight rates and cheaper fuel – but tumbling charter hire costs are proving to be the icing on their cake.

According to a recent Alphaliner report, containership daily hire rates have slumped by up to 50% since the coronavirus pandemic wrecked global demand and led container lines to off-hire surplus tonnage and decline extension options. Read more here.

CANADA BUSINESS – GOVERNMENT UPDATES

Port of Montreal Union Negotiations Update

ciffa.com

Further to the Canadian Industrial Relations Board (CIRB) June 9, 2020 decision to deny the Maritime Employers Association (MEA) request to designate port services as “essential services,” the MEA confirms the following:

“We have reviewed the decision. Although it does not correspond to our expectations, we remain convinced that the continuity and stability of the logistics chain is of the utmost importance. Our priority is to focus on the negotiations and reach a satisfactory agreement for all parties.”

With the Port of Montreal stevedores (CUPE 375) contract having expired December 31, 2018, the CIRB’s ruling is significant to port operations during this period of negotiations.

Canada’s Trudeau Warns Against Reopening Borders Too Soon

simpleflying.com

As the coronavirus situation appears to improve across Canada, the pressure is mounting to restart specific sectors of the economy. One notable industry that remains stifled is international tourism. This is due to travel bans and restrictions still in place, restricting entry into Canada. When asked about the reopening of borders this morning, the country’s Prime Minister pushed back – citing the risk of a second wave of infection. Read more here.