News Highlights week: 41 - 2024

Starting with the 23 October sailing of the 6,400 teu MSC DAMLA ex Haiphong, this port in Vietnam will become the new starting point for MSC’s Asia – West Coast of North America ‘Chinook’ service.

This standalone loop turns in eight weeks with eight 6,400 – 9,400 teu ships. The full revised itinerary reads: Haiphong, Yantian, Shanghai, Qingdao, Busan, Vancouver, Seattle, Portland, Haiphong.

For Haiphong, MSC’s ‘Chinook’ will be a second direct Pacific Northwest connection, adding to the ‘PN3’ service of THE Alliance which is operated by vessels of Yang Ming and HMM.

OOCL’s East-West revenues double year-on-year

Orient Overseas Container Lines (OOCL) reported shipping revenues of USD 3.1 bn for the third quarter of the year, up from USD 1.8 bn a year earlier.

The boost was fuelled by a doubling in earnings on the principal East West routes.

Revenue on the transpacific and Asia-Europe reached a collective USD 2.0 bn (3Q23: 1.0 bn) in the July-September period, despite a 16% y-o-y increase in volumes on the transpacific, and an actual 12% decline in liftings from Asia to Europe.

It is OOCL’s best revenue result since the fourth quarter of 2022. Rates have been pushed to their highest levels since the pandemic as western exporters have brought forward holiday shipments and the Red Sea diversions have kept capacity tight.

The figures suggest profits are likely to be strong for carriers when the next financial results are announced in November, though the fourth quarter remains a trickier prospect. Earnings are expected to show a sharp fall in the final quarter with rates already declining rapidly in the latter part of Q3.

US port strike ends sooner than expected

The US dockworkers’ union International Longshoremen’s Association (ILA) and the United States Maritime Alliance (USMX) which regroups employers of the US East and Gulf Coasts port sector, announced late on 3 October that the two parties had found an agreement to end the port strike that had been crippling container ports on the US East and Gulf Coasts since the start of the month.

Both parties have reached an agreement on wages which includes a 61.5% pay rise over a period of six years. ILA was initially asking for a 78% raise and was offered a 50% pay hike by USMX, one day before the strikes kicked off.

A extension of the current labour contract has meanwhile been agreed until 15 January 2025. This will give both parties time to negotiate other outstanding issues, particularly the delicate and important subject of terminal automation.

All ports and terminals affected by the walkout started re-opening late on 3 October. Over fifty container vessels had been queueing off the ports and it is estimated that around three weeks will be needed to clear the backlog, including the dispatch of stranded cargoes.

On 1 October the ILA started what was expected to be the largest port strike in the US since 1977, with 45,000 dockers stopping work and 36 ports - including 15 container ports - being shut down. Carriers had anticipated this crisis, which was expected to be a long one, by putting in place contingency plans and in some cases declaring ‘force majeure’.