PORT FEES FOR CHINESE SHIPS MAY PROMPT GENCO TO LEAVE US MARKET
Genco is the largest U.S.-headquartered bulker operator and has a substantial number of Chinese-built vessels in its fleet. As such, it is exposed to the proposed port fees on Chinese tonnage, written by the Office of the U.S. Trade Representative (USTR). If the fee structure is adopted as written, Chinese-built ships – and any global operators who use Chinese-built ships elsewhere – would have to pay millions of dollars for every port call in the United States. Exporters would also be required to ship an increasing percentage of their goods on U.S.-flagged tonnage, and eventually on scarce U.S.-built tonnage, raising costs for export shipments and creating new employment options for U.S. mariners. Multiple shipowners have described deep changes to their business if the fees go into effect. U.S.-based ro/ro liner ACL says that it will go out of business in the United States, and multiple ocean carriers have said that they will narrow their port calls down to a few major gateways to minimize fees. Genco’s Wobensmith told Bloomberg that he shares USTR’s goal of strengthening American shipping, but in the near term, his firm has two options: exit the U.S. market and focus on the rest of the world, which accounts for 90 percent of its business; or pass the extra U.S. costs on to the end user.
PORT OF SAVANNAH SETS RECORD CONTAINER, RAIL AND TRUCK MOVES IN FEBRUARY
The Georgia Ports Authority said the Port of Savannah moved 479,850 twenty-foot equivalent units, the busiest February on record and a 6% increase from the same month a year ago. Authority President and Chief Executive Griff Lynch in a release credited the surge to the port’s role as a gateway to the Southeast. Frontloading by importers ahead of planned U.S. tariffs also helped boost U.S. container volumes across major import hubs. On Feb. 28, the port achieved 2,246 rail lifts, a new record for a 24-hour period, at the Mason Mega Rail Terminal. The hub handles six trains daily or 42 per week, with dwell time of 19-24 hours. To further enhance efficiency, Gateway Terminals and the International Longshoremen’s Association union local have agreed to add three new start times for vessel operations: 6 a.m., 3 p.m. and 9 p.m. This expansion to eight total start times, coupled with 24-hour vessel service, is expected to significantly reduce vessel time at dock. Savannah is also implementing innovative solutions to increase vessel capacity. Starting in May, a new lay berth at Ocean Terminal will be utilized to stage vessels, dramatically reducing transition times between large ships. This strategy is projected to improve berth availability at Garden City Terminal by up to 75%, potentially allowing the port to handle two more ships per week, or an additional 100 vessels annually.
SLIDE IN GLOBAL FREIGHT RATES UNABATED
n the latest round of tariffs due to enter into force on 2 April steel and aluminum tariffs will be levied along with import duties on finished cars, with 25% tariffs while various trading partners including Mexico, Canada and China with tariffs across the board on imports. According to ABC News, “Consumer attitudes [in the US] worsened more than expected in March, dropping to their lowest levels since 2021, a Conference Board survey reported.” Some economists are forecasting a recession as a result of Donald Trump’s industrial policies with the US economy essentially defined by its consumerism, but as tariffs bite and prices rise, consumers are expected to lose confidence. The reality of declining confidence is reflected in the freight rates, particularly spot rates, which are effectively the pulse of the container shipping industry. Shippers and forwarders would be forgiven for thinking that the wave of extraordinary events that has carried shipping lines’ profits to historic highs is finally coming to an end, certainly the fundamentals point to that, but for the reality the coming weeks will be instructive.
CMA CGM AND ABB COLLABORATE ON PARAMETRIC ROLL ALGORITHM
Tech firm ABB and French liner giant CMA CGM are collaborating on a new parametric roll algorithm to improve ship safety with Splash reporting on many containers overboard incidents over the years. The solution integrates a theoretical framework developed by CMA CGM into the ABB Ability OCTOPUS Marine Advisory system. Parametric rolling has been a challenge to ship safely for decades. Particularly affecting containerships, ropax vessels, and car carriers, it means that a vessel experiences large rolling motions as it moves in waves. The phenomenon is hard to predict and poses a threat to vessel, cargo, and crew safety. By detecting and helping to prevent extreme parametric rolling, the new algorithm will help enhance operational safety by reducing the risk of accidents, vessel damage, and cargo loss at sea.