Weekly Supply Chain Update: 3

Porto Itapoá Continues as Brazil's Fastest-Growing Private Terminal

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In April, Porto Itapoá achieved a new monthly high by handling 107,475 TEUs, breaking its previous record of 106,565 TEUs set in October 2023. Felipe Fioravanti Kaufmann, the Director of Business Development and Customer Experience at the Brazilian port, commented on the significance of these figures. He stated, "For the past two years, we have been the fastest-growing private terminal in the country, now holding approximately 8.5% of the market share”. In April, Porto Itapoá experienced a rise in dry imports to 35,692 TEUs, a figure only surpassed by January's movement of 36,951 TEUs earlier this year. Meanwhile, dry exports amounted to 17,317 TEUs, which was second only to the 18,891 TEUs recorded in December of the previous year.

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Surge in Shipping Rates to South America and West Africa Due to High Demand for Chinese Electric Vehicles

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Rates are significantly high from China to South America at the moment. One of the reasons for this is due to Brazil and Mexico's plans to impose additional tariffs on Chinese electric vehicles in July and beyond. Automakers are desperately shipping to these regions without any orders. BYD has already shipped 100,000 vehicles. Electric vehicles companies have seized the majority of shipping resources. Many shipping companies withdrew vessels running to West Africa for these large orders leading to a general increase in rates to West Africa as well.

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Maersk Announces New Peak Season Surcharges for Shipments from Far East Asia to Global Destinations

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Maersk, the Danish shipping giant, has announced the implementation of new peak season surcharges (PSS) affecting shipments from Far East Asia to various global destinations. These surcharges are set to address the increased demand during the peak shipping season. The surcharge is $1,000 for all 20’ dry containers. Additionally, Maersk will increase the peak season surcharge for shipments from the Far East to Kenya. This adjustment will take effect in June, with a flat rate of $800 per container. These adjustments reflect the ongoing changes in the global shipping industry, influenced by fluctuating market demands and operational costs. Importers and exporters in these regions should plan accordingly to accommodate the increased shipping costs during the peak season.

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Panama's Newly Elected President Prioritises Canal Water Levels, Plans Reservoirs to Ease Drought Impacts

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The newly elected president of Panama has prioritised addressing water levels in the country's canal, marking it as a key issue on his agenda. Jose Raul Mulino, who triumphed in last Sunday's election, is set to start his five-year term in July. In an interview with Reuters, Mulino disclosed his plans to propose legislation to allow the Panama Canal to construct large water reservoirs. This initiative aims to mitigate the droughts that have significantly impeded traffic along the interoceanic waterway over the last year. Mulino stated that this legislation, which would authorise the canal to use land needed for the reservoirs, would be the first to be approved during his presidency.

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Weekly Spotlight: The Shipping Underworld

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The term "dark fleet" describes tankers involved in covert operations such as turning off their Automatic Identification Systems (AIS), or engaging in deceptive shipping tactics like GNSS manipulation and ID tampering. These vessels often carry crude oil and other liquid cargoes, using evasive strategies to skirt international regulations. The fleet's composition often includes weak ownership structures and rapid changes in flags of convenience, making tracking difficult. The number of dark fleet vessels has varied significantly with the introduction of each new regulation and has increased following the imposition of Russian oil bans and price caps.

There are approximately 1,100 vessels in the dark fleet. This practice, which has its origins in trades from Iran and Venezuela, has expanded significantly since the Russian invasion of Ukraine. Russia uses these methods to circumvent sanctions and continue oil exports to its allies. CNN reports suggest that over 10% of large tankers are now engaged in these illicit activities, with their numbers on the rise.