“Supply chain bottlenecks – largely due to the Red Sea attacks and Panama Canal restrictions –and expectations of high seasonal demand have seen ocean freight rates rise – but industry stakeholders believe they could fall after the pre-Chinese New Year rush.”

“According to the latest report from maritime and supply chain intelligence company eeSea, there has in fact been an increase in the number of cancelled sailings on the tradelane.
“We are already seeing an uptick in announcements of blank sailings just into the first week of 2024,” said eeSea, which would bring the total to 12 proforma voyages voided by transpacific carriers up to the end of February.”

“Maritime and supply chain intelligence company eeSea has its work cut out keeping track of the “hidden” or unconfirmed diversions.

In the absence of any official confirmation from operators, eeSea is relying on AIS and ship captains’ next port updates, when given, to track progress of vessels.”

“Panama Canal draught restrictions on one side of the world and Yemen-based Houthi rebels attacking shipping transiting the Red Sea enroute to the Suez Canal on the other side, are giving ocean carrier ship managers sleepless nights.

According to Destine Ozuygur, head of operations at maritime and supply chain intelligence firm eeSea, diversions of carrier proforma loops are being scaled up as more services avoid the two waterways.”

“This morning, eeSea data showed a queue of seven vessels waiting to transit the Panama Canal, one in transit and a further 15 at anchor in surrounding port areas; at Suez, there are seven vessels waiting for passage and two in transit, while 21 vessels are confirmed to arrive within the next week at the Cape of Good Hope.
But “ we expect to see this number rise as we definitively pinpoint more diversions in the following weeks”, she added.”

“The maximum draught of a vessel able to transit the canal as been reduced from 14.9 metres to 13.4 metres, while the number of daily transits has gone down, from the designed capacity of 34 to 38, to 24, which is set to be reduced to 22 on Friday, and again, to 18, by February.

Meanwhile, congestion at the waterway continues to mount on a daily basis, according to liner database eeSea, with 20 box ships waiting to transit – nine at the Pacific entrance and 11 in the Atlantic.”

“Hitherto, the main increase in the inactive containership fleet has come from small and medium-sized vessels, but increasingly carriers are deciding to mothball their surplus large ships that have been displaced by even bigger newbuild arrivals.”

“Analysts at eeSea pointed out that in the January to September period last year, 25% of proforma transpacific capacity was lost equating to 6.1m teu thanks to strikes and bottlenecks, so effective deployed capacity was only 17.5m teu.

In 2023 that number is 3.5m teu of lost capacity amounting to 17%, so effective deployed capacity is 17.1m teu or only a 2.4% drop compared to 2022, according to eeSea data.”

“Draught limits on vessels seeking passage through the Panama Canal continue to show an extensive reach throughout the global supply chain.

The team at eeSea is actively tracking a number of key indicators, including day-to-day congestion just outside of the canal, as well as bordering ports, vessel diversions and the offloading of extraneous cargo.”

“Waiting times for merchant ships have been growing this month, starting out at 15 days on August 1 and have now topped 20 days with a growing backlog of ships waiting at either end of the canal (see map below).

Special auctions are in place for cancelled slots, with very high fees demanded. Liners have reacted by implementing canal transit surcharges of up to $500 per teu.

Data from Denmark’s eeSea shows the average number of boxship transits over the past eight weeks has been 58 per week. Last week it slipped to 55.

“Obviously, if the drought continues, and we only handle, say 55 vessels like last week, the problem will accumulate,” warned eeSea’s founder Simon Sundboell.”

“Tomorrow, the fate of Canada’s west coast ports will be decided, as the ILWU Canada takes a vote on the proposed ‘tentative deal’.

The vote will mean work will stop between 8am and 4pm Pacific Time on Tuesday across all relevant ports.”

“Things are relatively quiet this morning, but it may simply be more of that breath-holding we are familiar with.

Despite a second tentative agreement being reached by both parties today, nothing is finalised yet and, after this week’s rollercoaster, most of us are probably hesitating to let out a sigh of relief.”

“Due to the fluidity of the situation unfolding on Canada’s west coast, it’s safe to say that plotting expectations for which vessels will realistically be given a berth over the course of the next week has become an increasingly difficult task.

Whether or not the ILWU will now return to the negotiating table, or renew its 72-hour strike notice (again) it seems fair to assume that Vancouver and Rupert ports will attempt to churn through as many vessels as possible in the next couple of days.”

“Details of the proposal were not made public, but sources said key stumbling blocks included remuneration and union jurisdiction over terminal maintenance work.

“Things have once again been thrown into turmoil just while teams on the ground are beginning to get their bearings on how the next few weeks will unfold,” eeSea analyst Destine Ozuygur told The Loadstar.”

“The port strike that paralysed most cargo moves through Canadian west coast ports since 1 July moved closer to its end yesterday.

Both the ILWU and British Columbia Maritime Employers Association (BCMEA) endorsed the compromise suggested by a federal mediator, opening the way to ratification by their respective members.

According to an operations update by the port of Vancouver, some operations were already set to resume yesterday afternoon, hours after the two sides signalled acceptance of the proposed four-year labour agreement.

However, it will take some time to work through the backlog, according to eeSea.”

“It seems that the 11th day of the strike has brought renewed confidence from the carriers in confirming schedule delays into long weeks, as well as two blanks; but there was still only one service-wide adjustment to speak of.

Yesterday, MSC announced that the Chinook service would temporarily be reverting to a Seattle-Portland-Vancouver rotation; confirming port swaps in advance for all Chinook vessels currently in the lineup.”

“The Canadian west coast ports strike is creating a trade situation we have not seen since COVID.

The ITS Logistics Port/Rail Ramp Freight Index shows nothing but a sea of red, and the fuel heating up this dumpster fire is the reconsignment of containers once bound for Canada, which will now be unloaded in the United States.

Destine Ozuygur, head of operations at maritime data and vessel tracking company eeSea, said the company has identified two additional vessels that are officially diverting from Vancouver. This brings the diversion count up to five.”

“Destine Ozuygur, head of operations at maritime data and vessel tracking company eeSea, told CNBC two vessels, the MSC Sara Elena and the Ever Safety, have officially left Canadian ports and will not return.

“This has been confirmed by the ocean carrier,” said Ozuygur.

The company is also tracking two additional ships that previously listed Vancouver as their destination on the schedule, but no longer do.”

“Twenty-eight consecutive work shifts lost and ten days of ILWU Canada’s strike action has potentially disrupted $7.5 billion of cargo – automotive parts, refrigerated food, fertilizer, critical minerals, commodities and goods that are not reaching Canadians, or our trading partners abroad.

The economic repercussions of this labour action have only been escalating. Every day, $800 million in critical cargo, comprising 25% of Canada’s total traded goods have been compromised by ILWU Canada’s strike action. Cargo is already being diverted, with eeSea data showing two confirmed omissions of Canadian ports by vessels that will only call at the US West Coast.”

“ILWU President Willie Adams said in a statement that the union will “not be unloading Canadian bound cargo in solidarity with our Brothers and Sisters in ILWU Canada.” But the fact is that the diverted ships, with billions of dollars in cargo, would not go to US ports if they did not have a reasonable expectation of it being unloaded.

In an interview with CNBC, Destine Ozuygur, head of operations at maritime data and vessel tracking company eeSea, confirmed that both of the ships would not be returning to Canadian ports. “This has been confirmed by the ocean carrier,” said Ozuygur.”