Did You Know That..

…Container rates in full retreat; stock sentiment hit by ceasefire. SCFI Shanghai-US west coast index declines 10% week on week. Spot rates are falling across the board, likely because of seasonal demand weakness. There is also a structural risk emerging: The Israel-Hamas ceasefire could eventually bring containerships back to the Red Sea, leading to severe overcapacity.

…Good news from Gaza, but shipping needs to wait and see. Houthi violence against vessels has cost the world economy billions. Hope for the best, prepare for the worst, and be unsurprised by anything in between.

…No imminent return to Red Sea for shipping despite Gaza ceasefire. Houthi militants signal that attacks may continue despite a ceasefire deal. A ceasefire deal in Gaza has not altered the current threat assessment for shipping in the Red Sea and shipping lines will not be prepared to disrupt global supply chains by re-routing until there is hard evidence the Houthi threat has diminished.

…Nevertheless, Houthis announce partial stop to Red Sea attacks. Only Israeli-owned and flagged vessels now subject to Houthi ‘bans’ on transiting Red Sea, Bab el Mandeb, Gulf of Aden, and Arabian Gulf.

…Reopening Suez Canal expected to trigger a 60%-70% drop in container rates. Carriers competing for market share and shippers seeking to retaliate for previously high rates will likely drive a race to the bottom. A return to Suez routing in the first half of 2025 is projected to push spot rates back to loss-making levels for carriers by year-end.

…Savannah speeds Indian cargo by eight days. The port of Savannah now offers faster logistics for cargo from India, reducing transit times to US inland markets such as Atlanta, Chicago, and Dallas by up to eight days compared to west coast ports.

…Trump tariffs could see a 70% drop in Chinese exports to the US. The export fall could wipe 2% off China’s GDP growth. The 45th and now 47th US president said he wants to impose tariffs of up to 60% on China on the campaign trail. If his wish comes to fruition, it could completely reorient global shipping.

…Why Chinese AI has stunned the world. DeepSeek’s models are much cheaper and almost as good as American rivals. A Chinese firm, DeepSeek, had released a “preview” of a reasoning model, dubbed R1, a week before that. Despite the American government’s efforts to hold back China’s AI industry, two Chinese firms had reduced their American counterparts’ technological lead to a matter of weeks.

…New feeder links Finland, Latvia, and Poland. CMA CGM has introduced the Baltic Express Service (BLX), a new feeder connection linking Finland and Latvia via Gdansk (Poland).

…AD Ports to add a logistics area in Alexandria. AD Ports and the Egyptian ministry of industry and transport are embarking on the joint development of a 1.1 sq km logistics park at Alexandria Port.

…Your editor made a trip to South America, and we expect to announce the entrance of new members Argentina and Uruguay shortly. Stay tuned.

…PSA International set a new record in 2024 by handling 100.2 million TEU globally, marking its first year surpassing the 100 million TEU milestone. This achievement includes 40.9 million TEU from PSA's Singapore terminal (+5.5%) and 59.2 million TEU from its terminals outside Singapore (+5.7%), reflecting a 5.6% overall volume growth.

…Biofuels gaining ground but price and scarcity are a risk. Owners should check their specifications to avoid technical mishaps. Biofuels are expected to gain in popularity, driven by emissions regulations, but shipping will struggle to find enough of them at the right price over time.

…Vietnam gains manufacturing ground - but will it provoke US tariffs? Vietnam is gaining ground as an alternative to China, but there are warnings that too rapid a growth could provoke tariffs from the new US administration.

…Guayaquil sets a new standard in banana exports. Contecon Guayaquil has launched Ecuador's first on-dock cold storage facility, the Guayaquil Banana Gateway, enhancing the country's banana export efficiency.

…Today, Chinese New Year has begun. 恭喜发财 (Gōngxǐ fācái), or 恭喜發財 (Gong Xi Fa Cai) in Cantonese. Wishing you all happiness and prosperity.

…Chinese New Year rush and threat of tariffs leave box ports congested. The Chinese factory rush to get goods out before the new year holiday and the threat of US import tariffs have seen global container port congestion hit a three-month high. Approximately 3.3 million TEU, or nearly 11% of the container shipping fleet, is held up at ports in Asia, Europe, and North America, according to a Linerlytica report today.

…Your editor just returned from a trip to South America. We expect to announce new members in Argentina and Uruguay shortly after CNY. Stay tuned!

…Crime gangs using fake security seals to access China-to-US containers. The ability to access and replace the seal on containers is triggering increased amounts of cargo crime – while failure to prevent it could see companies facing high costs.

…Bee Logistics, our valued members in Vietnam and Thailand, will also represent the network in Laos. More details about this new member will follow shortly.

Wishing you all a fruitful rest of the week!