Newsletter- August 18, 2022

OCEAN FREIGHT UPDATES

‘Two-tier’ market surfacing as gap between mega and smaller box lines widens

theloadstar.com
With the Q2 earnings season reaching its finale, an Alphaliner survey this week shows the profitability growth of the biggest carriers greatly exceeds that of the small and medium-sized lines.
Moreover, the consultant suggests, a “two-tier market” may be developing between the contract-focused carriers and those that tap the short-term and spot markets for their liftings. Read more here.

China’s Yangtze River Also Reports Falling Water Threatening Shipping

maritime-executive.com
While attention is focused on the falling water levels along the Rhine and its impact on Germany and Europe, word comes that China is facing a similar challenge along the Yangtze, the country’s longest river. Always one of the most important inland waterways in the country, China in recent years has invested heavily in the Yangtze seeking to enhance its role both in supplying inland regions and becoming an increasingly important pipeline to move exports to the major seaport at Shanghai located on the Yangtze Delta. Read more here.

Hundreds of boxes damaged in latest containership blaze off Colombo

splash247.com
Reports have emerged of another sizeable fire onboard a boxship. Insurance firm WK Webster carries news of a fire on the 8,586 teu Zim Charleston 10 days ago in the Indian Ocean.
Tracking from MarineTraffic (see below) shows the ship made for Colombo after the fire erupted, where the ship remains today. Read more here. 

Turning point? Port of LA boss sees imports ‘easing’ lower in August

freightwaves.com
Los Angeles, America’s largest container port, saw no letup in imports in July. But the numbers could finally start to pull back this month, according to Gene Seroka, executive director of the Port of Los Angeles.
Seroka reported Wednesday that Los Angeles handled 935,345 twenty-foot equivalent units last month, making it the port’s best July on record. Overall volumes, including imports, exports and empties, were up 5% year on year. Read more here.

Container line Zim hit by exposure to falling spot rates

freightwaves.com
Niche ocean carrier Zim has been one of the great success stories of the container shipping boom. It expanded its fleet faster than larger rivals off a smaller base, focused only on the highest-paying lanes — like the trans-Pacific — and kept spot exposure high at 50%. As earnings skyrocketed, it became the largest U.S.-listed shipping company by market cap.
Freight rates for the second quarter of 2022 disclosed by Zim (NYSE: ZIM) on Wednesday show that it’s still outperforming larger carriers on rates. Yet the numbers reveal a rising risk: Zim is more exposed to weakening spot rates than liner giants like Maersk and Hapag-Lloyd. And those spot rates are continuing to fall. Read more here.

GROUND AND RAIL FREIGHT UPDATES

Canadian Pacific gets regulatory OK on KCS deal, secures labor agreement

freightwaves.com
Canadian Pacific has received permission from U.S. federal regulators to pursue its acquisition of Kansas City Southern, the railway announced Tuesday.
The Committee on Foreign Investment in the United States granted the regulatory clearance. The committee, which is affiliated with the U.S. Department of Treasury, reviews certain transactions involving foreign investment in the U.S. to determine their effect on national security. Read more here.