Sea Archives | Page 36 of 70

Baltimore supply chain contingencies

Apr 3, 2024 | Automotive, Sea, Supply Chain, United States

In Baltimore work to remove the 9,662 TEU vessel Dali and damaged bridge has begun, with seven floating cranes and 30 vessels on scene, but with 4,000 tons of steel pinning the ship to the riverbed port officials suggest vessel diversions could last three months.

The bridge collapse will mean that for the time being it will not be possible for vessels to depart or berth at container terminals in Baltimore, so inbound vessels will need to re-route through other ports in the region.

It remains to be seen what the primary alternative ports will be for the most popular services and carriers, but from a sheer size perspective Norfolk and New York are the obvious choices to handle diverted vessels.

Moving Baltimore’s container traffic to Norfolk and New York would mean an increase of around 10% in volume handling in those two ports, but both had a volume drop in 2023, that could mean they have sufficient capacity. However, there may still be some disruptive effects and some bottlenecks meaning delays should be anticipated in the short term.

And while Maersk, MSC and Hapag-Lloyd have advised the discharge and load are happening in either Norfolk or New York, some of the smaller ports in the region such as Philadelphia, Charleston, Jacksonville and Delaware river ports may also be worth consideration.

Automotive adjusts to Baltimore Port closure
Baltimore is the busiest US port for vehicle imports and exports, with 850K cars and light trucks processed in 2023. Car makers that use Baltimore for shipping vehicle and parts shipments include GM, Toyota, Jaguar Land Rover, Mazda, Mercedes and Volvo.

Wilmington, Delaware and Brunswick ports in Georgia are handling the first wave of diverted vehicle carriers from Baltimore. However, one of the four roll-on/roll-off (Ro/Ro) terminals at Baltimore port continues to receive shipments, due to its upstream location, on the seaward side of the collapsed bridge.

The privately-owned terminal handles imports of Volkswagen and BMW vehicles and its location on the seaward side of the Francis Scott Key bridge, means it will remain open despite the closure of the rest of the port.

The specialist automotive RoRo carriers are pursuing alternative solutions in nearby ports, while Wallenius Wilhelmsen’s 8,000-CEU Carmen completed its call at Baltimore prior to the bridge collapse but is now unable to leave the port.

While Baltimore is an important RoRo call virtually all services linking North America with key vehicle exports markets in Asia and Europe call at Brunswick, which makes it a viable option for manufacturers and automotive shippers.

While most displaced cargo will be bound for the Northeast US, the Port of Jacksonville, Florida, has spare berth and terminal capacity to handle additional cargo volumes, should contingency plans consider a southern-based solution.

Metro have alternative solutions to Baltimore gateway and we can provide containerised services for vehicles into other US gateways.

Our weekly transatlantic Ellerman US Express (USX) service serves New York, Philadelphia, Norfolk and Jacksonville, with direct port calls in the UK, Europe, Scandinavia and Baltics.

If you would like any further information on this, or our other contingency solutions please do not hesitate to EMAIL our Automotive Account Director, Ian Tubbs.

Avoiding the bill that Dali shippers will face

Apr 3, 2024 | Insurance, International Trade, Sea

The Francis Scott Key Bridge in Baltimore collapsed after the container ship, Dali, collided with it last Tuesday. The eventual cost of the disaster is expected to be hundreds of millions of dollars and shippers with cargo aboard the Dali could ultimately be responsible for the ship’s damages and associated costs.

An established maritime law known as General Average (GA) where all parties involved in a sea voyage share any losses incurred, ensures that all parties have a vested interest in the vessel, because they share the risk and cost of protecting it.

General average situations can occur when a ship is lost, suffers damage or becomes stranded, or when cargo needs to be damaged or thrown overboard to save the vessel.

It’s too soon to know whether costs incurred to free the Dali will qualify as a case of General Average, or whether General Average will be called by the owners, though the latter is extremely likely due to the sheer scale of the disaster.

General Average is one of the most complex procedures in insurance, because insurers will need to calculate the total value of all the goods onboard the vessel to work out the amount owed by each shipper.

With about 4,700 full containers (just under 50% of capacity) aboard the Dali at the time of the collision, establishing the value of each container is complex and using historical data, the process can often take several years.

Adding another level of complexity and probably cost is the fact that a large proportion of the cargo aboard will inevitably be uninsured, as too many shippers either assume it’s already in place, or covered by their freight forwarders or the shipping line.

Despite several high-profile casualties in recent years, General Average remains rare in shipping and something many shippers aren’t aware of, or think of insuring against.

While there might be some coverage by a freight forwarder or carrier under their standard trading conditions, these are typically limited, as opposed to the actual value of the goods.

When General Average is called, the consignee will need to provide security for the cargo’s proportion of the General Average, typically a percentage-based deposit, or an Underwriter’s Guarantee.

Metro’s All Risk marine insurance covers the full value of your goods and protects you against all loss of cargo and the risk of General Average.

For further information on our marine insurance cover and to ensure that you have full liability, please EMAIL Laurence Burford, CFO at our Birmingham HQ.

Maersk vessel collapses Baltimore bridge

Mar 26, 2024 | 4PL, Automotive, Exports, Logistics, News, Sea, Supply Chain, United States

The Dali, a time chartered Maersk container vessel with two pilots onboard, crashed into a support pylon of the Francis Scott Key Bridge in Baltimore, Maryland, in the early hours of Tuesday 26th February, collapsing a large section of the 1.6 mile bridge into the Patapsco River.

The Francis Scott Key bridge was the main thoroughfare for drivers between New York and Washington who sought to avoid downtown Baltimore. It was one of three ways to cross the Baltimore Harbour, with a traffic volume of 31,000 cars per day or 11.3 million vehicles a year.

The collapse of the bridge has cut off access in and out of the port for vessels. Around the world, about 40 ships, including 34 cargo vessels, have Baltimore listed as a destination, including 10 commercial ships with anchors dropped in nearby waters, according to MarineTraffic.

Baltimore port’s private and public terminals handled 847,158 autos and light trucks in 2023, the most of any U.S. port.

On top of the RORO operations Baltimore port handles around 21,000 TEU a week, which will have to be re-routed via other ports in the region until access is restored.

It is still unknown how long the port will be cut off due to the incident, but any length of downtime will greatly impact RORO capacity into the US East Coast, as well as cause additional congestion at alternative ports that will need to take on the overflow of ocean containers that would naturally route through Baltimore.

This also comes at a time when there is an element of uncertainty regarding the future situation at the US East and Gulf Coast ports due to the International Longshoremen’s Association and the United States Maritime Alliance current contract set to expire on 31st September 2024. Whether this incident will have any impact on the negotiations remains to be seen but Metro will be monitoring the situation closely and will be keeping our customers informed.

Automotive logistics contingency

The impact on RoRo, container and conventional freight moving into Baltimore is going to be significant. Baltimore is one of the largest RoRo ports for global vehicle movements into and out of the US East Coast. Carriers have already began to advise of diversions and avoidance of the port for the foreseeable future across all ocean freight modes.

We anticipate that there will be a consequential effect on vessel rotations and schedules ongoing to and from Europe and that vehicle compounds at alternative ports will become congested adding further to the impact, especially on the automotive sector.

RoRo carriers are already seeing a surge in bookings, adding further pressure on the high demand routes to the US. We will continue to update on the situation and market intelligence as it unravels. The impact will be ongoing for many weeks, and as experienced from the pandemic and Red Sea situations it is likely that indirect issues will arise as an outcome of the initial tragedy.

Metro have alternative solutions to Baltimore gateway and we can provide containerised services for vehicles and also other gateways into the US.

We are currently compiling the alternative options that we have and can share these with you in conjunction with our partner shipping lines and local offices in the US.

Please contact us for further information and speak with your account manager who will be delighted to arrange a meeting or Teams call to discuss the options available and your own specific needs and forecasts during the period of closure.

If you would like any further information on this solution and how it can work for you please do not hesitate to EMAIL our Automotive Account Director, Ian Tubbs.

TPM and US review

Mar 20, 2024 | Air, China, International Trade, Sea, Supply Chain, United States

Organised by the Journal of Commerce, TPM (Transpacific Maritime Conference) is the premier global shipping and supply chain conference, attracting senior executives from all areas of the industry.

Held annually in the port city of Long Beach, California, TPM brings together shippers, carriers, freight forwarders, intermodal operators and technology providers to discuss the most pressing global challenges and developments, for a week of essential networking, seminars, and relationship building.

With over one hundred presentations, interactive speaker sessions and networking events, and almost two hundred speakers, including leaders from the largest brands and carriers on the planet, TPM really is in a league of its own.

Metro’s Chief Commercial Officer, Andrew Smith, joined this year’s conference, to participate in TPM’s insightful panels and forward-thinking discussions to explore the global dynamics and challenges impacting ocean supply chains.

Andrew said “It was important to take the opportunity to travel out to Long Beach for TPM as part of my recent visit to the United States, to meet key customers, partners and carriers. It was a full on trip, encompassing seven cities across the country in just over a week, and the time spent talking to customers in particular was invaluable”.

“The Red Sea crisis was obviously a major talking point among delegates and in particular how to manage a situation which appears to have no immediate solution and is likely to continue for the foreseeable future.”

“TPM was as interesting and insightful as always and I think the key takeaways are well-worth sharing.”

“Keynote speaker Robert Gates, the former CIA director, painted a picture of a world where increasing local conflicts should be anticipated and with the global geopolitical landscape the most challenging it has been for decades, preparedness for future supply chain disruption is essential.”

“In this environment it is perhaps natural that so many shippers are looking at de-risking their supply chains. Resilience and flexibility are at the core of de-risking, with initiatives such as multi-carrier programmes, sourcing diversification, re-shoring and near-shoring.”

“Another takeaway worth highlighting is that despite all the current operational challenges, sustainability still remains top of the agenda for carriers and major shippers, and the TPM programmes reflected this, with nearly a third of the scheduled events featuring environmental, transformation and sustainability issues.”

“My visit to the United States, alongside Metro colleagues regular trips, reiterate our focus and commitment to this important market. This focus will continue and ramp-up further with a new route development role created to expand both customer and partner engagement.”

“To discover how we can support your Transpacific or Transatlantic trade needs, or to discuss any of the issues highlighted here, please reach out to me directly via EMAIL.”