Market Update – October

September 28, 2023

Greetings from SILA Global!

As October unfolds, it’s crucial to examine the evolving landscape that defines this industry and delve into the challenges and opportunities shaping the industry this coming month. The China market is bracing itself for significant shifts in the shipping and logistics landscape, primarily due to the annual National holiday, which spans from October 1st to October 7th. This holiday period, while a time of celebration and reflection for many, has ripple effects that resonate throughout the shipping industry. Here, we delve into the forecast for the next month and the challenges and changes that lie ahead.

Space Supply and Scheduling

Week 39: Schedule Shuffling

The kickoff to October brings with it several notable alterations to shipping schedules. In Week 39, we’ll witness:

North East Asia-Australia (A3N) Service Sliding:The A3N service is set to slide into Week 40. This schedule change will necessitate adjustments for shippers and logistics operators.
Panda Bunching:A phenomenon known as “Panda Bunching” is expected. Multiple shipments are grouped together, resulting in altered transit times and potential delays.
Service Delays – China-Australia Express (A1X):The A1X service, originally planned for Week 39, will also be affected by the holiday and will now operate in Week 40.

Week 40: Blank Sailing Dominates

Week 40 will see a significant impact on shipping services, including:

Blank Sailing Galore:Most of the services, including North East Asia (A3C), China-Australia Express (CAX), China-Australia (CA2), and MSC’s Panda & Dragon services are expected to go blank during this week. Blank sailing involves canceled voyages, causing disruptions in cargo movement.
Bunching- A3N/A1X:Bunching is anticipated for A3N and A1X services, further complicating scheduling and logistics.

Week 41: More Blanks, Bunching & Omissions

Week 41 continues the trend of schedule interruptions, with:

Blank Services:North East Asia (A3N), North East Asia (A3S), Asia-Australia (AAs), and China-Australia (CAT) services are expected to be blanked, meaning they won’t be operating during this period.
Bunching – Thailand-Fremantle Express (TFX):The trend of “bunching” extends to the TFX service, leading to potential delays and congestion.
Service Omission – CAT (EMC/YML/SNL/HPL): The first notable omission comes from the CAT alliance, which includes EMC, YML, SNL, and HPL. In Week 41, this alliance will omit several crucial ports, including Shekou (SHK), Shanghai (SHA) and Ningbo (NGB).
Service Omission – CA2 (SLS): The China-Australia (CA2) service, operated by SLS, will also see an omission in Week 41. Ports like Qingdao (TAO), Shanghai (SHA), and Shekou (SHK) will not be part of the service during this week.
Service Omission – AUN (ONE/MSK): Week 41 brings another omission, this time from the Australia North East Asia (AUN) service, which includes ONE and MSK. Ports like Qingdao (TAO), Ningbo (NGB), Yantian (YTN), and Shanghai (SHA) are excluded during this week, affecting cargo schedules and logistics planning.
Service Omission – A3S (CMA/COSCO/OOCL/PIL): Week 41 brings an omission for the North East Asia (A3S) service, operated by CMA, COSCO, OOCL, and PIL. Ports like Xiamen (XMN) and Shekou (SHK) will not be part of the service during this week, potentially affecting cargo movements in the region.
Service Omission – A3C (OOCL, COSCO, ANL, PIL): North East Asia (A3C) service, involving carriers OOCL, COSCO, ANL, and PIL, will omit Shanghai (SHA) and Ningbo (NGB).
Service Omission – CAX (GSL): The China-Australia (CAX) service by GSL will face double omissions in Week 41 and Week 42. Ningbo (NGB) and Shenzhen (SZX) will not be served during these weeks.

Week 42: A Bunching & Omissions Encore

As the holiday season draws to a close, Week 42 will witness:

Bunching – A1X/CAX/Panda:The month ends with bunching for A1X, CAX, and Panda services, adding another layer of complexity to cargo scheduling.
Service Omission – CAX (GSL): The China-Australia (CAX) service by GSL will face double omissions in Week 41 and Week 42. Ningbo (NGB) and Shenzhen (SZX) will not be served during these weeks.

Service Omission – CAE/NEAX (EMC/ONE/HMM): Week 42 brings an omission for the China-Australia (CAE) & North East Asia (NEAX) service, involving carriers EMC, ONE, and HMM. Yantian (YTN), a significant port, will not be included in this week’s service.

CA2 Consortium Contract Expiration – March 24

As the global shipping industry continues to navigate a complex and ever-changing landscape, one topic has captured the attention of industry players and experts alike: the China Australia Service (CA2) Consortium.

This consortium’s existing contract is on the verge of expiration, with the deadline set for March 24. The uncertainty surrounding the future of the CA2 Consortium has triggered discussions and speculations within the maritime community. Industry stakeholders are keenly interested in whether this influential consortium will choose to extend its operations beyond this pivotal date. The implications of this decision are far-reaching and have the potential to impact the dynamics of the global shipping market significantly.

In the midst of this uncertainty, SILA remains dedicated to providing the latest updates, ensuring that you stay well-informed and prepared to navigate the intricacies of the shipping and logistics industry. Keep a close watch as we continue to monitor developments surrounding the CA2 Consortium’s contract expiration.

While China’s National holiday is a time of celebration, it also poses unique challenges for the shipping and logistics industry. With schedule changes, omissions, blank sailings, and bunching becoming the norm for the next few weeks, adaptability and proactive planning will be key to ensuring smooth operations in this dynamic environment. As the holiday season unfolds, stakeholders in the China market must stay vigilant and agile to steer their businesses through these turbulent waters.

Flexibility and proactive decision-making will be essential to navigate the complexities of the global shipping landscape in the weeks ahead. By keeping a watchful eye on trends and a readiness to embrace innovation, together we can navigate the seas of change and chart a course toward a more resilient and prosperous future.

Please reach out to our dedicated representatives for guidance and solutions that cater to your specific requirements and thank you for entrusting us with your shipping needs.