Ian Matheson, from Impress Communications, reviews some recent news that might impact on Members’ business
TIACA predicts air cargo recovery as year progresses
and 2022, it has become clear that this is not going to last. The extent of the plunge in container spot rates took even the most pessimistic observers by surprise and there can be little doubt that earnings will be considerably impacted. Sales and purchases of container ships halved to 950,300 teu in 2022 as freight levels began normalising, according to Alphaliner. It noted that 295 containerships were sold in 2022, down 49% from 2021 and capacity-wise, representing a 53% drop from the record 2.04 million teu that changed hands in 2021. Despite the collapse in spot rates, ocean carriers are fundamentally in a stronger position than in the past, and shippers would be wise not to confuse a temporary down cycle with the liners’ structurally stronger long-term position, says analyst Lars Jensen of Vespucci Maritime. ON THE QUAYSIDE According to media reports, Shanghai retained its position as the world’s busiest container port for the 13th consecutive year in 2022, handling a total of 47.3 million teu. China still has many of the top 10 ports in the world based on container volume. DP World’s container terminal at Southampton achieved its greenest-ever year in 2022 after delivering a 55% reduction in net carbon emissions from its fleet and installations. It became the first UK port to switch fully to Hydrotreated Vegetable Oil (HVO) last April. Liverpool City Region and Freeport East have received the green light from the government to begin operations, meaning most of the eight proposed freeports are now open for business. This includes Plymouth, Solent and Teesside, East Midlands Airport, Humber and the Thames, in addition to the latest two, which will each receive up to £25 million of seed funding from the government over the next few years.
IN THE AIR Whilst Tiaca says that high inflation, high interest rates, high energy costs and concern over job security have compounded to create an air of defensive consumer spending, which is in turn affecting the air cargo industry, it believes the current situation is temporary and that structurally the industry is in a good place. It predicts that towards the second half of 2023, demand could pick up compared with 2022. Although current retail inventory levels are high, when consumer spending resumes those levels should fall.
with a ‘win/win’ outcome for airlines, forwarders and shippers as chargeable weight fell 8% on a year ago. The general airfreight spot rate registered its largest year-on-year decline of 35%, but overall average rates remained 75% above the pre- COVID-19 level, according to weekly market analysis by CLIVE Data Services, part of Xeneta, published in January.
IATA statistics in January sent mixed signals about air cargo. Airfreight demand measured in cargo tonne kilometres (CTK) declined 13.7% year-on-year in November, the ninth demand decline in a row, reflecting the high inflation that is curtailing the spending capacity of households, the ongoing war in Ukraine disrupting trade flows, and the “unusual” strength of the US dollar making commodities traded in dollars more expensive in local currency terms. ON THE OCEAN MSC was by far the largest container shipping line by teu capacity, according to data released in January by analyst Alphaliner. It was followed by Maersk, then CMA CGM, COSCO and Hapag-Lloyd. The top five container lines controlled 16.9 million teu, over 60% of global capacity. The three main ocean carrier alliances between them have a current newbuilding orderbook of some 5 million teu, The Loadstar publication reported. The newbuildings are set for delivery within the next two to three years, in most cases replacing smaller tonnage and boosting the capacity offered by each alliance. Various round-ups of 2022 published online suggest that whilst container shipping has enjoyed unprecedented earnings in 2021
A turbulent 2022 for the global air cargo market ended in December
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