Congestion, epidemic, high demand, new conditions in air transportation and shipping

According to the latest data from the Marine Exchange of Southern California, on the 1,000-mile stretch of North American coastline, 101 container ships berthed or wandered on two gateway waterways in the United States waiting for berths. Before the epidemic, ships that usually took only two weeks to travel from Asia to North America are now taking up huge capacity due to congestion and delays. Ships on some voyages have berthed for more than 45 days. "Zhonggu Shandong" has been waiting for berth for 55 days.

Although the Port of Los Angeles disclosed that the number of ships waiting to be reduced by nearly half within a week, the fact that congestion has not eased. Last month, U.S. authorities pushed the ship’s anchorage away from the California coast and required the ship to stop 150 miles from the coastline. When you can't see a large number of container ships, the number of subsequent congested ships continues to increase.

Through the analysis of Clarksons' port blockage data and Los Angeles Port's outbound ship volume data analysis, cross-tracking confirms that the port congestion has not yet been alleviated. The reduction is due to the adjustment of anchorage arrangement rules which resulted in some ships not being counted.

The Southern California Shipping Exchange adjusted the queuing rules for anchorage waiting on November 15th. According to previous rules, ships waiting to enter the port can wait at anchorages within 20 nautical miles from the Port of Los Angeles and Long Beach. In the past six months, increased port congestion has led to overcrowding in the waiting area. Due to safety and air pollution considerations, the new regulations stipulate that, except for special circumstances, waiting ships can only be at 150 miles southwest of California and 50 miles away from California and Mexico. Waiting in the sea, only ships that can enter the port within 72 hours of the port’s notification are allowed to slowly approach the port anchorage and wait for mooring nearby. As a result, the distance between freighters has increased, and the speed of cargo entering the port has also been lengthened, resulting in further aggravation of port congestion.

The latest data from the Marine Exchange of Southern California shows that there are currently 101 container ships stranded, of which 30 are anchored in Southern California waters, and 71 are slowly sailing or drifting outside the designated safety and air quality areas.

"Can you imagine the risk of 101 container ships gathering in 40 miles of water near Los Angeles during tonight's storm?" Now, these ships have spread 1,000 miles, many of which are located in relatively calm waters south of the Mexican coast. "The exchange said in a Facebook post on the 13th.

As of the evening of the 13th, the authorities have actually cleaned up all the ships anchored in Los Angeles and Long Beach to deal with the upcoming major storm.

Sal Mercogliano, an associate professor at Campbell University in North Carolina, pointed out in his latest video in the popular YouTube "What's happening in shipping" series that the waiting time for ships on the trans-Pacific trade route is extremely long. The video pointed out that the "Navios Amarillo" waiting in the waters of Baja, Mexico and the "Maersk Esmeraldas" waiting in the waters of Xiamen are the most typical cases.

The 4250TEU "Navios Amarillo" left the Port of Busan, South Korea on November 17, and is currently anchored in Mexican waters. It is planned to anchor in Los Angeles on January 2 for 46 days.

The 13,000 TEU ship "Maersk Esmeraldas" that had called Hong Kong, Shenzhen, Yantian, and Xiamen ports at the end of November left Xiamen Port two days ago (actually it departed on December 1) and is still anchored off the coast of China. The sea area not far away, planned to arrive in Los Angeles on January 11, requires a one-month transit time, which shows the scale of congestion on the trans-Pacific route.

The ports of Los Angeles and Long Beach announced on the 13th that the planned "container overdue detention fee" charged to shipping companies will be postponed for another week. This is the fifth postponement. The fine was first raised in October, but it has not yet been implemented.

To meet the soaring demand of consumers before Christmas, some importers need to ensure that their products can be put on the shelves in time during the holidays, and have to abandon sea transportation and switch to air transportation.

However, according to relevant statistics, in the past three months, air freight prices to and from major Asian routes have doubled.

The British "Financial Times" reported that the price of air freight from Shanghai to North America reached a record high of US$14 per kilogram, which was much higher than the US$8 per kilogram at the end of August. The current price has exceeded the 12 per kilogram at the beginning of the new crown epidemic.

 The all-time high of the dollar. But the additional cost of air freight may put pressure on consumers through inflation.

At the same time, similar routes, such as Hong Kong, China to Europe and the United States, and transatlantic routes between Europe and North America, have seen significant increases in air freight prices.

"Everyone knows that if you want goods to be on the shelves before Christmas, you must use air freight." said Yngve Ruud, global air cargo director of Kuehne+Nagel, one of the world's largest freight forwarders. A freight forwarder said: "The market expects the peak season and air cargo market demand will continue until March next year."

The Financial Times analyzed that there are many reasons for the soaring air freight prices:

•First, the global shipping congestion has caused a large number of companies to switch to air routes to transport products such as fashion goods, consumer electronics and parts.

•Secondly, the widespread spread of the "Omi Keron" strain of the new crown has caused a large number of new crown testing reagents and personal protective equipment to be demanded all over the world.

•Finally, due to holidays such as "Black Friday" and Western Christmas, the global supply chain is extremely busy.

It is understood that some airlines have switched to air freight services, and logistics companies such as FedEx and DHL are also filling some of the gaps to fully cope with the increasing demand for such convenient, fast but expensive services.

Marco Blomens, head of freight consulting at Sebury Consulting, a subsidiary of Accenture, said that the current aviation industry’s capacity is still 13% less than in 2019, while demand has increased by 6% over the same period, resulting in a nearly 20 percentage point between supply and demand. difference. According to the latest statistics and analysis reports, the current chaotic supply chain situation may not be eased until the second half of 2022.