EU | UK news digest. 18 June
Port’s of Hamburg congestion forces companies to look for the alternatives, but are there any of them left? Container export freight rates have marked the 10th week of consecutive growth
Freight rates for container exports from the Port of Shanghai in Week 23 increased from the previous week on several trade routes, commemorating the 10th consecutive week of growth. Spot rates for moving containers to Europe picked up 7.9% to US$6,355 per TEU, while those to the Mediterranean were carried at US$6,272 per TEU, swelling 5.4%. Carriers lose patience with congested box terminals and dump their cargo at other ports. In addition, they are being asked to pick up the tab for inland on-carriage or relay to destination ports. While Hamburg is being omitted, the struggle for booking slots and surge in demand cause Liverpool’s container port to implode. As the result, real costs are being incurred and more charges are added. They demurrage for vehicles waiting more than 90 minutes at the port, as well as a £100 surcharge for end-of-the-week collections is imposed. For the time being, in the EU, export demand is expected to remain strong across all trade lanes.
The high hopes for rail freight to become one of the means for post-crisis recovery have been in the air for a while now. According to the experts, the China-Europe rail connections could come to the rescue indeed, since Eurasian trains have acquired a more prestigious position and are now a credible alternative to maritime transport in terms of reliability and prices. The new services that enter the market with an intermodal profile are equally important in this sense. The facilitation of rail development has become a primary objective for many companies. The Netherlands is participating in a new study on feasibility of a new train connection from Antwerp to the Ruhr area in Germany. The initiative addresses the issue of the rising industrial demand. Lineas follows suit. The company will connect the North Sea Port and Ghent directly to the Intermodale Milano Segrate terminal in Northern Italy. The new train service will have an intermodal profile and will run with five weekly roundtrips. Industry players believe that another strategically important direction for development in terms of recovery – the Rhine-Alpine corridor – could be improved with the help of additional investments. Instead, the Dutch port of Moerdijk bets on infrastructure and strives to increase the number of weekly trains. Meanwhile, the UK sees itself as the main driver of the rail freight locomotive based on the data that demonstrates the increased efficiency of the local rail network as a sign of market recovery. In turn, Britain’s biggest inland intermodal terminal – DIRFT – is swiftly moving to the largest stage of its development that will boost its capacity up to 32 trains per day.
However, the situation on the roads leaves much to be desired. The continuous, acute shortage of HGV drivers has reached a phase of critical importance on the national level in the UK. Experts claim that there is no quick solution to the problem in the current context and the government needs to take active steps especially after it intervened to change the tax rules and added drivers to the migrant skilled labor. In general, whatever measures authorities implement, they have to design them with respect to efficiency. This common knowledge might not be a common practice – Danish restrictions on road haulage are already affecting transport companies. FREJA Logistics experiences increasing capacity shortages that are very difficult to meet due to the imposed measures that are too bureaucratic and time-consuming to comply with. As the result, Danish hauliers cannot provide satisfactory solutions to the transport demand.
The air sector is still struggling, and yet the first steps towards an upward trajectory are being undertaken. Despite the ease of the lockdowns, rates from India to the UK are high, amounting to $3.2-$3.5/kg, which is an uptick, compared with the EU prices of $3-$3.2/kg, due to the limits on factory production and tight air and sea freight capacity. The latter continues to jeopardize the situation. In unison with other sectors, airfreight calls for government support. Logistics UK, together with the Aberdeen Investment Fund, has issued a call to arms to the UK government that could significantly improve the current state and maintain already achieved accomplishments. Among the objectives proposed by the companies, it has been suggested to expedite negotiations between the EU and UK on traffic rights to open up core markets and ensure the free flow of cargo. It seems like there is no better moment for it since the European market is so eager to move forward. The Italian market, which has long wished for its very own freighter operator following the demise of Cargoitalia, is set to see an all-cargo operator launch shortly. Aliscargo, to be based at Milan Malpensa, is in the final stages of getting its AOC after its first aircraft delivers at the weekend.
