In a new customer report, Maersk, the liner giant, said that the month on month decline in US imports "is not due to weak demand, but to the continuous disruption of transport capacity caused by severe congestion in the entire trans Pacific transport network."
Freightwaves, a SaaS data provider in the North American freight market, has a shippers' exclusive maritime booking index on its platform, which shows that after rising in the whole may, the index has now stagnated, with a short decline at least in early June, including booking data for the coming week.
The index provides a directional indicator of future US imports. Based on 20 foot equivalent unit (TEU), as of the scheduled overseas departure date.
▍ continuous congestion and epidemic put pressure on the supply chain
At present, there are still dozens of ships berthing in San Pedro Bay and San Francisco Bay near the California coast, Los Angeles and long beach ports, and drifting in the Pacific Ocean near Auckland port. The average waiting time of the ships is one to two weeks. The delay also seriously affects the liner frequency, and the effective capacity and ships can not return to Asia in time to load goods.
Novel coronavirus pneumonia in China's Shenzhen port exacerbated the pressure of supply chain. Maersk said in a customer consultation report on Thursday that the productivity of the eastern port area of Yantian international container terminal (YICT) dropped to 30% of the normal level, while all operations of the western port area of Yantian were suspended until further notice. Maersk expects Yantian International's ships to be delayed for "more than 14 days.". Meanwhile, the novel coronavirus pneumonia prevention measures at Shekou port are now restricting the export container transport.
Flexport warned in a market update report this week that "the emergence of an epidemic in the place of origin - especially the nationwide blockade in Yantian port and Malaysia - may lead to vessel diversion, more suspension and upward pressure on rates."
▍ 2m alliance adjusts services from Asia to North America
In view of the unprecedented market situation on the west coast of the United States, serious port congestion has slowed down the supply chain and cargo delivery of various ports. 2m alliance plans to adjust its sailing plans across the Pacific West Coast of the United States and Canada, and adjust its TP Alaska service by increasing the coverage of vessels and ports, so as to provide more stable services and improve the reliability of the shipping schedule.
As shipping schedules change, Maersk and MSc say their goal is to match actual departure dates in Asia. As a result, it has been announced that the number of voyages for the following services will be revised to provide better schedule reliability:
In addition, Maersk will adjust its US line service and its TP Alaska service by increasing vessel and port coverage to provide more stable service and improve shipping schedule reliability.
TP Alaska service will now provide weekly direct flights from Shanghai and Yantian to Tacoma, while continuing to provide a bi weekly westbound service from the US Dutch port to Northeast Asia.
Current TP Alaska routes: Dutch port (USA) * – Yokohama (Japan) * – Busan (Korea) * – Qingdao (China) *.
New TP Alaska route: Shanghai (China) - Yantian (China) - Tacoma (USA) - Dutch port (USA) * - Yokohama (Japan) * - Busan (Korea) * - Qingdao (China) * - Shanghai (China) - Yantian (China) - Tacoma (USA).
First voyage frequency and time:
In general, the delivery time of Asian container shipment is being extended. According to a Cowen teleconference team member, "in the past, shipping space had to be reserved about two weeks in advance, but now it takes four to six weeks, sometimes even eight weeks."
And according to flexport, "capacity constraints and origin and destination constraints continue to extend the travel time of all lanes." The trans Pacific freight situation is "critical," the report said.
▍ high demand coexists with supply disruption
From the point of view of pure demand, in theory, US import pre orders should still be rising.
The evercore ISI retailer survey reached 68.6 points last week, the highest level in 20 years. In a conference call organized by investment bank Cowen and company, a team member from its intermodal logistics division said, "large retailers are not seeing any slowdown." Another member of the group said that "for the rest of the year, the customer's PO (purchase order) has been fully reserved."
The Institute for supply management's inventory index for may fell again to 28. This is the lowest level since the index was established, which means that the demand for replenishment inventory in the next few months will be very high.
Henry Byers, a maritime expert at freightwaves, said, "the demand is so high that it finally tests the capacity limit. Congestion of ships, suspension of empty flights, imbalance of containers and accumulation of goods originating in mainland China have forced the volume of sea containers to be limited. "
"I also think that some end customers are starting to cancel or delay orders because of the long delivery time. To some extent, customers start to change their buying behavior based on delivery time and availability. " Byers said.
"There are challenges in both demand and supply. High demand and supply disruption are our common problems, and that's where we are now. "