Dear Valued Client
We would hereby kindly like to update you on the current status of the cargo movement industry.
The following was extracted from the document titled “B4SA Covid-19 – Cargo Movement Update – Summary – 5 March 2021”.
COVID-19: CARGO MOVEMENT UPDATE
An average of ~8,259 TEUs was handled per day for the last week, with a decreased average of around ~9,177 TEUs (↑11%) expected to be handled next week. These container throughput volumes remain sub-optimal, as several operational constraints persist, despite a better all-around weather week. A significant concern revolved around the availability of tugs, raising alarms at Durban, Port Elizabeth and Ngqura. The incessant headache of vessel bypasses that has been a consistent refrain in these reports was brought into sharp focus this week. The catastrophic impact of 64 vessel bypasses has resulted in 36,000 containers lost due to transhipment, with a grand total of 101,000 containers lost. There are no words to describe how detrimental these losses have been to the local and national industry.
Internationally, global container freight rates remain elevated at $5,121.04 per 40ft container but appear to have started their long-overdue decline this week. Collectively, the experience of congestion, poor productivity and container imbalances appears to continue for the moment, although with less negative impact than earlier in the year. Ultimately, the situation is reflected at many ports worldwide, emphasising South Africa’s current commercial realities. Fortunately, most major trends indicate some stabilisation and recovery soon.
The outlook remains somewhat better concerning air cargo as air cargo volumes to and from South Africa are slowly increasing. The daily average volume of air cargo handled at ORTIA over the seven days starting 22 February amounted to 453 296 kg inbound and 360 593 kg outbound. In total, that results in an average of 813 889 kg per day, which is approximately ~95% compared to the two months before the lockdown period (compared to ~94% last week). For the domestic industry, average air cargo moved since the lockdown period has amounted to ~66 845kg per day (↑0.2% compared to last week), which constitutes approximately ~39%, compared to the previous year (~39% previous week).
In terms of the global aviation industry, Africa and the Middle East was the second-best performing region behind North America in the fourth quarter of 2020. Although passenger-kilometres fell by ↓69.7% in December, air cargo experienced a strong year-end, with cargo tonne-kilometres down by only ↓0.5% in December compared with December 2019. For 2020 collectively, CTKs fell by ↓10.6% for the entire region. However, for African carriers, CTKs increased by ↑5.4% for December, which has meant that Africa’s cargo load factor has continued to increase, currently at 44.2% for 2020. The elevated CLF remains on the high side due to the lack of belly-hold capacity. Nevertheless, the outlook for 2021 is much better compared to the historic low of 2020. Air cargo freight rates have also come down lately, which is positive news.
For South African trade, our recent trade surplus has continued in January as exports have increased by ↑8.7% y-o-y, while imports fell by ↓5.5%. Overall, these figures correlate into a trade balance surplus of R11.83 billion (compared to a R2.7 billion deficit in 2020). A regional trade surplus (R6.52 billion) was also registered despite exports decreasing by ↓17.7% between December and January to R10.11 billion. Imports from BELN countries fell by a marginally ↓0.1%, amounting to R3.59 billion for the month.
In summary, it is evident that some green shoots are developing for both the domestic and international supply chains. Coupled with the generally poor economic state of South Africa currently, these developments are most welcome. But on a cautionary note, as the movement of people and goods gathers pace, we need to be vigilant of the external environment in which we operate.
MEDITERRANEAN SHIPPING COMPANY: BLANK SAILING WEEK 10
In addition, please be advised that due to the current difficulties being faced by the market MSC has notified that they plan to exclude one sailing during week 10 on the Asia – Africa network.
Kindly refer to the notice as received from MSC for more details: Blank Sailing Week 10
CFR: MAURITIUS ADVISORY – LOCKDOWN 10-25 MARCH 2021