The Weekly Roar

In this week’s Roar: an early peak, air cargo volumes flying high, pedal to the metal for intermodal, update on S. African ports, and technology trends for 2024.

www.wsj.com

Hapag-Lloyd just released financial results for its Q4, and it details just how much liner shipping revenues have dropped — a whopping 77.1% from 2022 to 2023, calculated before interest, taxes, depreciation, and amortization. And although volumes were up slightly, lower freight rates wiped out margins and profitability. But, while all of that sounds troubling, it appears better days may be on the horizon. There’s an expectation that peak season will start a bit earlier this year, partially due to depleted inventories worldwide.

It’s a different story for air cargo, where spot rates have been increasing. Although air cargo tends to soften at this time of year, disruptions in the Red Sea and e-commerce activity out of China have spurred an uptick in volume. February’s year-over-year percentage increase in global air cargo volumes is at 11%, with some airlines making up more than 50% of their revenue from e-commerce.

Volume is up for intermodal as well, with February marking the fourth month of an upward trend in volume. The Intermodal Association of North America (IANA) released the following data: total February volume was up 14.6% annually, which is a significant gain over the previous three months, which saw gains of 3.8%, 6.4%, and 5.5%, respectively. Total intermodal volume was up 9.9% annually in February, and domestic containers were up 5.7% annually.

Things may be looking up for South African ports. After years of less-than-positive conditions and a weakening infrastructure, the South African Association of Freight Forwarders (SAAFF) is reporting that container throughput is up significantly. Additionally, the port operator reports that there were 23% more containers handled in February when compared to January, which is a 26% year-on-year increase. However, the port also admits that it’s too soon to call this a trend.

Gartner has released a list of the top strategic supply chain technology trends for 2024. To name a few, cyber extortion, data governance, and AI-enabled vision systems. Cyber extortion may be an unfamiliar term; it looks at mitigating cyberattacks through collaboration with IT and planning. As powerful AI tools scale in capability, the importance of maintaining strict governance and a high level of data quality is becoming increasingly important. Finally, AI-enabled vision systems are solutions to capture, interpret, and infer based on the capture of real-time images.

For the rest of the week’s top shipping news, check out the article highlights below.