09 November 2020

Air & Ocean Service Announcement | 10 November 2020

There have been a number of developments this week reported by our Mainfreight teams around the world. 

In the Northern Hemisphere, our European team has seen largely social restrictions reintroduced in reaction to a surge in Covid-19 infections as they move into the Northern winter. As we experienced earlier in the year, to date these lockdowns have not impacted on the movement of cargo, and are not expected to.

Closer to home here in Australasia, Port challenges on both sides of the Tasman have seen further degradation in scheduled shipping line services. Delays are materialising across most shipping lanes in and out of New Zealand, whether they be at origin, through transhipment or schedule changes, or over local ports.

It is important at this time that all customers allow for potential delays, and talk to their local Mainfreight Air & Ocean team about any time sensitive shipments. 

Ports of Auckland & Tauranga

As communicated last week, the Port of Auckland remains under pressure to process in and outbound containers, which is driving shipping line behaviour and having a flow-on effect on the Port of Tauranga, as more vessels omit Auckland in favour of Tauranga. 

The Mainfreight team around the world managing shipments into and out of Auckland are being notified of congestion surcharges being imposed by the lines. These currently are in a range between USD $200 and USD $300 per TEU.

The latest Operational Update from Port of Auckland tells us that vessels are continuing to be worked at the Terminal, albeit at lower productivity levels than expected. 

This is primarily due to compounding demand of vessels and volume, balancing labour supply within fatigue risk parameters, as well as continued trialling of vessels and truck moves through Automation as they work through implementation. 

Vessel delays are currently on average up to 10 days, with a risk of further slippage being signalled. The Port is in the process of planning berthing windows for vessels working at the Terminal, although the results remain indicative only, while the current issues persist. 

The Port release also advises that due to the dynamic and changing environment it is difficult for Port and shipping line tracking websites to be accurate. 

Shipping Line schedule changes and vessel port call omissions around New Zealand have been increasing as a direct result of the Auckland congestion, with many carriers opting to call at Tauranga instead of Auckland, or omitting ports such as Lyttelton, Wellington & Napier to make up time lost waiting for a berth in Auckland.

Due to these changes, the Port of Tauranga and its Auckland inland hub, Metroport, have seen record numbers of import & export containers being processed, leading to congestion and delays at both facilities. 

The Port of Tauranga announced this week that demurrage-free days at both sites has been reduced from 5 to 4 days in an effort to reduce the number of containers being held.

In order to mitigate some of the worst of the situation outlined above, our team has been matching imported container equipment directly with export requirements across customers. As our business is evenly weighted between in- and outbound shipping, we are often able to successfully match import and export volume shippers.

Our Port Operations teams in Auckland and Tauranga have also been circumventing shipping line rail delays through road bridging direct off the Tauranga Port into or out of Auckland-based customers. 

Our Tauranga Air & Ocean team have also been utilising our recently expanded facilities there to unload imported containers and deliver via our FTL fleet into many North and South Island locations. 

With all of the ocean freight challenges being experienced, we have seen an increase in Air freight enquiry as our customers explore options to meet market commitments. 

This is expected to accelerate as we close in on the end of the year, so we suggest that any customers needing expedited services like air freight, should get in touch with their local Mainfreight team member.

Mainfreight Australia

As advised in previous notifications, concerns with congestion at port terminals and ECP’s (Empty Container Parks) in Sydney continue. Our Port Transport teams are working closely with all stakeholders to manage the impact of waiting time, detention and alternate site storage where possible. 

While delays of up to 5 hours when returning empties are being seen, our team is only passing on waiting time fees for those containers where 2+ hours is incurred. 

Our team in Australia remains optimistic that this is a short-term issue, with government and industry initiatives being discussed to reduce the congestion.

Wider Port issues through the eastern seaboard of Australia have diminished this week, and are expected to improve further in coming days.

Mainfreight Asia

Billy Zhang, Mainfreight Regional Sales Director - Asia, has told us this week that across his region, Covid-19 appears well-controlled, with only Malaysia reporting more daily infections.

In all 9 Asian countries where Mainfreight has a presence, cargo operations are continuing as usual. 

Billy tells us that a deficit of 40’ equipment remains in the main ports of China, Thailand and Vietnam. Capacity also continues to be under pressure from Asia to all regions, including Australasia. 

However Mainfreight customers with good forecasting are successfully moving containers ex Asia.

Mainfreight North America

Mainfreight VP of Air & Ocean Sales for North America, Jake Moller, reports that although a surge in Covid-19 cases have been reported, there is no indication of further official lockdowns as are being seen in Europe, with all customers operating much as usual. 

As was communicated last week, there are however challenges around the movement of containers, with months of near capacity volumes and restricted operations now compounded by increased peak season importing:
  • A nationwide chassis shortage is continuing to be felt, with Los Angeles and Long Beach Port Terminals particularly impacted. 
  • Rail heads inland around the rest of the United States also face delays. 
  • The volume surge is also limiting the ability of terminal operators to implement cargo-handling enhancements such as dual transactions and dray-offs that help truckers increase their productivity. 
The Mainfreight Port Operations team based at our Carson site in LA, is managing to keep containers moving, but advises that it would be prudent to be prepared for delays over the coming months.

Our Domestic Transport teams across the United States have been prepared for any disruption in the wake of the Presidential Election 48 hours ago. As of this morning, no issues impacting on the delivery or collection of cargo have been experienced. 

Mainfreight Europe

Netherlands-based Jake Pascoe, European Sales Manager for Mainfreight Air & Ocean reports that this week heavier social restrictions have been introduced in many continental European countries and the United Kingdom. 

Across the region schools, colleges and universities remain open. However, in France the universities are now closed and in Belgium all schools are closed until mid-November.

Most European countries have restrictions in place for bars and restaurants, with many closed. 

From a cargo operational perspective:
  • Our teams continue to see challenges procuring ocean freight container equipment across Europe. In some countries up to 3 weeks is required, with inland depots more challenging with empties not being relocated fast enough. 
  • Container cartage in the United Kingdom is under pressure with delays of a week not uncommon. 
  • Felixstowe continues to be challenged in clearing the backlog at the terminal, with no acceptance of empty containers for dehire currently. 
The Mainfreight Europe team of 2,745 dedicated people across 45 branches in 11 countries are working with customers and suppliers to manage the local situations we are encountering. While delays are occurring, we are finding that cargo is moving through to intended recipients successfully.

Around the 26 countries that make up the Mainfreight world, our Air & Ocean teams on the ground, working closely with our local Transport teams, are finding solutions to either circumvent congestion trouble spots, or mitigate potential issues through earlier planning. We know that communication is key during this period.

We are uniquely advantaged in the networked structure of our business, and the systems that support both our teams in 280+ Mainfreight branches around the globe, and the great customers that we work with.

For all Mainfreight customers and suppliers, right now the single most important message is that the further ahead bookings can be made, the more likely we are able to achieve an outcome that meets expectations. On most lanes, for sea freight FCL movements we would recommend booking a minimum of 4 weeks prior to ex store date. 

To talk with one of our team, please Contact your local Mainfreight branch.

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