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There's apparently a container ship stuck nearly sideways in the Suez Canal.
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Mar 23, 2021 22:02
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Lol bet they lost the plant. They could be very very bad depending on how bad it is grounded. Looks like seven tugs are pushing on it now trying to get it off.
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Mar 23, 2021 23:40
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Bar Ran Dun posted:Lol bet they lost the plant. They could be very very bad depending on how bad it is grounded. Looks like seven tugs are pushing on it now trying to get it off. Yeah, news reports I'm seeing say they lost power and steering during a sand storm of some kind. Now SMIT Salvage has been hired to deal with it, and they're towing other ships out to go around the Cape. Does it mean anything special that this particular company is hired to deal with the mess? I'm more familiar with aerospace personally.
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Mar 24, 2021 23:32
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SMIT raised the Kursk and did the Costa Concordia. So they’re serious business not loving around salvors.
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Mar 24, 2021 23:39
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I'm assuming this is gonna further blow up asia -> WEU sea freight costs? Re-routing around the cape must be +2wks vs the canal and the sudden jump in transit times sure must not help.
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Mar 25, 2021 03:18
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meowmeowmeowmeow posted:I'm assuming this is gonna further blow up asia -> WEU sea freight costs? Re-routing around the cape must be +2wks vs the canal and the sudden jump in transit times sure must not help. Guess it's more incentive to ship by rail the next few months.
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Mar 25, 2021 04:27
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Lol don’t matter if ya can’t get cans. Can’t put a container you don’t have on a train.
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Mar 25, 2021 05:46
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Bar Ran Dun posted:SMIT raised the Kursk and did the Costa Concordia. Thanks for the info.
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Mar 25, 2021 06:43
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Evergreen declared general average. So... everybody with cargo (or there insurers) are on the hook (in a proportional, pro rata way). https://en.m.wikipedia.org/wiki/General_average Any shippers that didn’t have marine insurance about about to poo poo their pants.
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Apr 1, 2021 18:54
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Bar Ran Dun posted:Evergreen declared general average. So... everybody with cargo (or there insurers) are on the hook (in a proportional, pro rata way). What sorts of costs need to be covered here? Was there damage to the ship itself or is this for the loss of time-sensitive cargo? Also given the size of the ship, aren't there going to be a whole lot of folks to spread the cost across? Thanks for the updates, this is really interesting.
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Apr 1, 2021 20:46
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Bar Ran Dun posted:Evergreen declared general average. So... everybody with cargo (or there insurers) are on the hook (in a proportional, pro rata way). Who is potentially liable for damages?
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Apr 1, 2021 23:12
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So here’s my understanding of how it works. I think liability is only the ship and cargo. Do not the delays to all the other ships just the Ever Given and the cargo on the Ever Given. The carrier isn’t liable for the ship/cargo loss anymore one general average happens. When there is a major event like this a a salvor comes in a saves a vessel they have a salvage claim. These can be... large like half the ship Large. That percentage was probably negotiated in this case with SMIT before they started. So there liability will be the salvage claim, vessel repairs and cargo damages. Once GA is declared each shipper has to pay a bond to get their cargo. They or their insurer doesn’t pay, they never get the cargo. They have to figure out all the losses. That’s going to take a long time like half a year to years maybe. Then they have a total of all the losses , salvage, ship damages, cargo damages. Then they get a percentage. All this was worth X before the accident, the losses are Z so we have loss percentage. Each shipper and the carrier have to pay in to cover the loss relative to the value they had going in adjusted by the loss percentage. So your poo poo was $100,000. 100,000 x loss percentage is what you owe. For the carrier value of the ship x loss percentage is what they owe. Then the losses to each party get paid out, out of this. So if you had $100,000 and $10,000 got ruined by the delay, you get $10,000 back (but you still paid in the loss percentage) if the loss percentage was 40%. You’d lose 30,000 (pay in 40 payed out 10). Most of the cargo on this ship is going to be okay outside of perishables so basically the carrier is going to benefit immensely and the cargo Interests will be on the hook for a big chunk of the salvage. It’s going to take years for this to all play out.
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Apr 2, 2021 02:19
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Some marine insurance contract still refer to the transit of shipments as “the adventure” and this is the poo poo why.
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Apr 2, 2021 02:22
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So what you are saying is we can expect a wave of cheap 2021 Funkopops to hit the stores around 2024.
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Apr 2, 2021 07:22
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Bar Ran Dun posted:Some marine insurance contract still refer to the transit of shipments as “the adventure” and this is the poo poo why. Thanks for spelling all this out to the rest of us, it’s absolutely wild!
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Apr 2, 2021 16:51
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steinrokkan posted:So what you are saying is we can expect a wave of cheap 2021 Funkopops to hit the stores around 2024. Salvage isn’t what it used to be. Most contracts have control of disposition with the assured more as bad they all care about brand damage. Anymore food is impossible to salvage.
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Apr 2, 2021 18:03
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So Yellen wants a global minimum corporate tax. initially through OECD as a voluntary commitment from major economies so not unlike the Paris Agreement. I suppose the idea is to then start squeezing tax haven shitholes until they fall into line. It's hopefully a first step towards slightly less blatantly explotative globalism. One might even contemplate the possibility of minimum environmental and labor requirements somewhere down the line.
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Apr 6, 2021 08:28
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So now literally years after it was discussed here: https://www.nytimes.com/2021/06/01/business/coronavirus-global-shortages.html?referringSource=articleShare
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Jun 1, 2021 19:13
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Bar Ran Dun posted:So now literally years after it was discussed here: I love how that article completely missed the fact that Toyota has been increasing their inventory of computer chips due to realizing that the chip supply chain was volatile as all hell. Also, there’s a massive difference between “inventory” and “excess inventory”.
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Jun 2, 2021 06:04
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Solkanar512 posted:Also, there’s a massive difference between “inventory” and “excess inventory”. Try to explain this to a manager who's been having cargo cult lean courses and JIT philosophy shoveled in their direction since university.
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Jun 2, 2021 10:29
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Solkanar512 posted:I love how that article completely missed the fact that Toyota has been increasing their inventory of computer chips due to realizing that the chip supply chain was volatile as all hell. ah, someone else watches wendover productions
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Jun 5, 2021 15:55
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mandatory lesbian posted:ah, someone else watches wendover productions Yeah, but I also work for a large manufacturing company. It's weird to me how many other types of businesses try to cram lean/jit/etc into their methods. Orange is right when they used the term "cargo cult".
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Jun 5, 2021 17:28
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Some of the supply chain modeling stuff I have talks about having “evangelists “ for implementing it.
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Jun 5, 2021 17:57
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SHIP ORDERS SURGE AS CARRIERS RUSH TO ADD CAPACITY Global shipyards that were retrenching and consolidating in a faltering maritime market barely more than a year ago are now flush with new orders, boosted by efforts by shipping lines to add capacity to meet resurgent consumer demand in Western economies. Orders for new container ships in the first five months of this year were nearly double the orders for all of both 2019 and 2020, according to London-based maritime data provider VesselsValue Ltd., with the biggest gains going to shipyards in South Korea and China. The order tally has been so strong that some yards have stopped giving quotes for new vessels and are trying to renegotiate existing orders for more than 20 ships as the price of steel plates used to build vessels has doubled since the end of 2020, according to people involved in those deals. The resurgence in ordering is being driven mainly by container ships as Western retailers such as Walmart Inc. and Amazon.com Inc. scramble to restock after a year of supply-chain disruptions from the coronavirus pandemic. The rush to replenish depleted inventories, along with congestion at major ports in North America, Europe and Asia, has left cargo space hard to find and sent freight rates soaring. That has spurred big profit gains at operators like A.P. Moller-Maersk, CMA CGM and Hapag-Lloyd , as well as triggered moves to renew and expand their fleets. The strong orders are in contrast with the past couple of years, when a long downturn in maritime trade left a dwindling backlog of orders at shipyards and forced some to consolidate. “It’s been our busiest period in years and it’s very much about container ships,” said a senior executive of South Korea’s Hyundai Heavy Industries Co., the world’s biggest shipbuilding facility in terms of capacity. “The orders are mostly for bigger ships with all the extras to emit less, which is good for margins. We are almost out of slots to build new ships until late 2023.” “I’ve never seen such demand in 20 years,” this executive said. South Korea’s three big yards - Hyundai Heavy, Daewoo Shipbuilding & Marine Engineering Co. and Samsung Heavy Industries Co. - account for more than a third of all shipbuilding orders for all types of vessels. The other shipyards with big shares of global orders are China State Shipbuilding Corp., China Shipbuilding Industry Corp. and Japan’s Imabari Shipbuilding Co. In the first five months of this year, 208 container ships worth $16.3 billion were added to the global order book, compared with 120 ships valued at $8.8 billion for all of last year and 114 vessels worth $6.9 billion in 2019, according to VesselsValue. The South Korean shipyard executive said the boxship orders are mainly for vessels that can move around 14,500 containers and behemoths with a capacity of more than 20,000 boxes that are mainly deployed on Asia-Europe trade lanes. (The Wall Street Journal, 6/8/2021)”
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Jun 11, 2021 22:36
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https://www.npr.org/sections/money/2021/06/15/1006381735/how-chaos-in-the-shipping-industry-is-choking-the-economy
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Jun 15, 2021 18:42
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LINER CONGESTION SPREADS ACROSS THE PLANET, 304 SHIPS QUEUING FOR BERTH SPACE The ebb and flow of record global liner congestion is neatly encapsulated in two maps provided below from Seaexplorer, a container shipping platform created by logistics giant Kuehne+Nagel. As of 3.30 pm Singapore time today there were 304 ships idle in front of ports around the world waiting for berth space to open up. Seaexplorer data shows there are 101 ports reporting disruption such as congestion. Officials at the Kuehne+Nagel digital offshoot report the number of ships forming queues hit 350 in the middle of this week before falling back to 304, the same level as this time last week (see lower map). Red dots in the enlargeable maps represent clusters of ships while orange ones mark out ports that are congested or suffering from disrupted operations. The clear change over the past week is how the congestion, so visible in recent weeks in south China, a key export area hit by a Covid-19 outbreak, is now spreading to other important hubs. Singapore, for instance, has seen the number of boxships waiting for berth space increase by 37.5% over the past week, while intra-Asia hubs such as Laem Chabang are now reporting tailbacks and in the US, east coast ports are suffering all manner of disruptions. While last week, boxships queueing in Chinese waters made up more than 50% of the global total, this has dropped today to less than 40% indicating the growing global congestion contagion. Terminals are becoming global bottlenecks, be it at berths, yards or gating out cargo. Maersk, the world’s largest container line, in a post from earlier this week discussed the stretched nature of global supply chains, something it warned was now the new normal. “The trend is worrying, and unceasing congestion is becoming a global problem. Due to Covid-19 and a significant volume push since the end of last year, terminals are becoming global bottlenecks, be it at berths, yards or gating out cargo, and it’s continuing throughout the logistics chain – in the warehouses, the distribution centers – with numbers on the rise,” Maersk stated. Splash reported yesterday how the partial shutdown of Yantian Port following a Covid-19 outbreak late last month is now on track to affect twice as many containers as were impacted during March’s high-profile blockage of the Suez Canal. (Splash 24/7.com, 6/18/2021)
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Jun 18, 2021 17:10
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The skyrocketing price of shipping goods across the globe may hit your pocketbook sooner than you think - from that cup of coffee you get each morning to the toys you were thinking of buying your kids. Transporting a 40-foot steel container of cargo by sea from Shanghai to Rotterdam now costs a record $10,522, a whopping 547% higher than the seasonal average over the last five years, according to Drewry Shipping. With upwards of 80% of all goods trade transported by sea, freight-cost surges are threatening to boost the price of everything from toys, furniture and car parts to coffee, sugar and anchovies, compounding concerns in global markets already bracing for accelerating inflation. “In 40 years in toy retailing I have never known such challenging conditions from the point of view of pricing,” Gary Grant, the founder and executive chairman of the U.K. toy shop The Entertainer, said in a interview. He has had to stop importing giant teddy bears from China because their retail price would have had to double to add in higher freight costs. “Will this have an impact on retail prices? My answer has to be yes.” A confluence of factors - soaring demand, a shortage of containers, saturated ports and too few ships and dock workers - have contributed to the squeeze on transportation capacity on every freight path. Recent Covid outbreaks in Asian export hubs like China have made matters worse. The pain is most acutely felt on longer-distance routes, making shipping from Shanghai to Rotterdam 67% more expensive than to the U.S. West Coast, for instance. Often dismissed as having an insignificant impact on inflation because they were a tiny part of the overall expense, rising shipping costs are now forcing some economists to pay them a bit more attention. Although still seen as a relatively minor input, HSBC Holdings Plc estimates that a 205% increase in container shipping costs over the past year could raise euro-area producer prices by as much as 2%. Central bankers have so far been sanguine about the phenomenon, arguing that the rise in consumer prices tied to supply hiccups won’t last. European Central Bank President Christine Lagarde said on June 10 that while supply-chain bottlenecks would push up production prices and the headline inflation rate is expected to rise further in the second half of this year, the effect will fade. Several factors explain the relative lack of concern. Shipping costs only constitute a small fraction of the final price of a manufactured good, with economists at Goldman Sachs Group Inc. estimating in March - when China-Europe rates were about half of current levels - that internationally they made up less than 1%. To top that, companies have annual contracts with the container lines, so the prices they’ve locked in are considerably lower than the headline-grabbing spot rates. Although the latest round of contract negotiations in May reflected the stronger spot market, HSBC trade economist Shanella Rajanayagam said that “the longer-term rates are much much lower than the spot rates, even if they are feeding through.” With the end of lockdowns consumer demand is likely to shift to services from goods, but “the risk of course is that higher shipping costs persist - especially given ongoing shipping disruption - and that producers become more willing to pass these higher costs on to consumers,” Rajanayagam said. While many economists note that even a full pass-through of higher shipping fares to consumers will have a marginal effect on headline inflation, Volker Wieland, a professor of economics at the Goethe University in Frankfurt and a member of the German government’s council of economic advisers, warns that they might not be sufficiently factored in. “Even if the order of magnitude is smaller than estimated, the dynamic builds over a year and has significant effects,” he said. “That means there’s a danger we’re underestimating the impact.” (Bloomberg, 6/14/2021)
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Jun 18, 2021 17:12
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RETAILER HOME DEPOT CHARTERS BOXSHIP TO MAINTAIN SUPPLY CHAIN After months of reports of capacity and equipment shortages highlighting the challenges retailers are having getting merchandise to their stores, one of the largest big-box stores in North America, Home Depot, has taken the extraordinary step of chartering a containership to maintain its supply chain. It is the first time in the company’s 40-year history that it has gone to such extremes to fill its shelves. The home improvement’ retailer ranks as one of the largest importers. With nearly 2,300 stores in the U.S., Canada, and Mexico, Home Depot generated over $132 billion in revenues in 2020. The home improvement sector continues to be one of the hottest segments, with consumers deciding to make changes as they spent months at home during the pandemic. With sales rising over 30 percent in the first quarter of 2021, Home Depot has a voracious appetite for merchandise to keep its stores and warehouses full. Each store stocks approximately 35,000 products, the company reports, with a total of more than one million items listed in its online store. President and Chief Operating Officer Ted Decker told CNBC that the company has already taken usual steps to maintain its merchandise inventories and get products on the shelves during the disruptions to the global supply chain. He said Home Depot has purchased merchandise at higher costs in the open market beyond its contracted suppliers. The company has even resorted to flying smaller, higher value items, such as power tools and electrical components, by air freight to make up for shortfalls in supply. Describing the company’s latest efforts to maintain its supply lines, Decker told CNBC, “We have a ship that’s solely going to be ours, and it’s just going to go back and forth with 100 percent dedicated to Home Depot.” He did not identify the size of the boxship or which carrier they are chartering the vessel from, nor the length of the charter. He said it would start running next month, but did not specify which routes or ports. Last week, the National Retail Federation forecast that the U.S.’s major ports were on track for record volumes in 2021 driven in large part by retail merchandise imports. The NRF in its monthly Global Port Tracker projected that container volume would remain above 2020 levels at least until the fall but might see a slight decline in volumes versus 2020 before retailers begin stocking up for the holiday retailer season. (Maritime Executive, 6/15/2021)
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Jun 18, 2021 17:22
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A fire in Canada just cut off grain exports out of Vancouver.
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Jul 7, 2021 16:05
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Bar Ran Dun posted:A fire in Canada just cut off grain exports out of Vancouver. 
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Jul 8, 2021 03:47
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https://splash247.com/congress-to-debate-amending-us-shipping-act-next-month/ They might ban international container liner carriers from refusing us exports. This is uh possibly uh... Wars start over this type of stuff. Also https://splash247.com/white-house-readies-supply-chain-disruptions-task-force/
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Jul 19, 2021 21:15
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Bar Ran Dun posted:https://splash247.com/congress-to-debate-amending-us-shipping-act-next-month/ ....how does that actually work? Like if the container liner says "hmmm nah" and the US says "Welp no ports for you here" wouldn't the US economy basically implode again while the shipping companies admittedly need to scramble for ports but have other options?
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Jul 19, 2021 21:25
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Well we do something like the certificates they are talking about with cruise ships already. But the you must accept all exports business... That’s new. I don’t think they’ll go hmmm nah. In the short term I think they would all just comply. Long term it would depend on how we acted. If we are dicks about it all, this is the type of thing that starts wars. It would definitely be a departure from how the regulation of international shipping works now.
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Jul 19, 2021 22:10
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My guess is the impetus was on empty containers but they couldn't just word it specifically for empty containers. Hopefully that's the case and other countries will just eat the loss because JIT uber alles.
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Jul 20, 2021 09:56
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https://www.nytimes.com/2021/08/20/opinion/us-globalization-tariffs.html?referringSource=articleShare Lol I fired an email off at Krugman asserting he was underestimating the effect of the container flow issue on inflation and I’m pretty sure this is his the response. Honey, Who Shrunk the World? When I was in my 30s, my parents gave me a sweatshirt bearing the words “Global shmobal.” At the time, I was going to many economics conferences; when my parents would ask me what the latest conference was about, I apparently always replied, “Global shmobal.” What I didn’t know at the time was that the global was about to get even shmobaler. In the mid-1980s, world trade had recovered from the disruptions and protectionism of the interwar period, but exports as a share of world G.D.P. were still back only to around their level in 1913. Starting around 1988, however, there was a huge surge in trade — sometimes referred to as hyperglobalization — that leveled off around 2008 but left the world’s economies much more integrated than ever before: Image Exports as percentage of world G.D.P. Exports as percentage of world G.D.P.Credit...World Bank This tight integration has played an important background role in pandemic economics. Vaccine production is very much an international enterprise, with production of each major vaccine relying on inputs from multiple nations. On the downside, our reliance on global supply chains has introduced forms of economic risk: One factor in recent inflation has been a worldwide shortage of shipping containers. But how did we get so globalized? There are, it seems to me, two main narratives out there. One narrative stresses the role of technology, especially the rise of containerized shipping (which is why the box shortage is a big deal). As the work of David Hummels, maybe the leading expert on this subject, points out, there has also been a large decline in the cost of air transport, which is a surprisingly big factor: Only a tiny fraction of the tonnage that crosses borders goes by air, but air-shipped goods are, of course, much higher value per pound than those sent by water, so airplanes carry around 30 percent of the value of world trade. By the way, pharmaceuticals, presumably including Covid-19 vaccine ingredients, are mainly shipped by air: An alternative narrative, however, places less weight on technology than on policy. That’s the narrative one often sees associated with Trumpists (although they’re not the only ones with something like this view): Globalists pushed to open our borders to imports, and that’s why foreign goods have flooded into our economy. And the truth is that from the 1930s up to Donald Trump, the U.S. government did, in fact, pursue a strategy of negotiating reductions in tariffs and other barriers to trade, in the belief that more trade would both foster economic growth and, by creating productive interdependence among nations, promote world peace. But the long-run push toward more open trade on the part of the United States and other advanced economies mostly took place before hyperglobalization; tariffs were already very low by the 1980s: While there weren’t big changes in the policies of advanced economies, however, there was a trade policy revolution in emerging markets, which had high rates of protection in the early 1980s, then drastically liberalized. Here’s the World Bank estimate of average tariffs in low and middle-income countries: You might ask why a reduction in emerging-market tariffs — taxes on imports — should lead to a surge in emerging-market exports. So let’s talk about the Lerner symmetry theorem — or, actually, let’s not and just say that tariffs eventually reduce exports as well as imports, typically by leading to an overvalued currency that makes exporters less competitive. And conversely, slashing tariffs leads to more exports. Basically, nations can choose to be inward-looking, trying to develop by producing for the domestic market, or outward-looking, trying to develop by selling to the rest of the world. What happened in much of the developing world during the era of hyperglobalization was a drastic turn toward outward-looking policies. What caused that trade policy revolution and hence helped cause hyperglobalization itself? The immediate answer, which may surprise you, is that it was basically driven by ideas. For more than a generation after World War II, it was widely accepted, even among mainstream economists and at organizations like the World Bank, that nations in the early stages of development should pursue import-substituting industrialization: building up manufacturing behind tariff barriers until it was mature enough to compete on world markets. By the 1970s, however, there was broad disillusionment with this strategy, as observers noted the disappointing results of I.S.I. (yes, it was so common that economists routinely used the abbreviation) and as people began to notice export-oriented success stories like South Korea and Taiwan. So orthodoxy shifted to a much more free-trade set of ideas, the famous Washington Consensus. (Catherine Rampell suggests that should be the new name for D.C.’s football team. Nerds of the world, unite!) The new orthodoxy also delivered its share of disappointments, but that’s a story for another time. The important point, for now, is that the change in economic ideology led to a radical change in policy, which played an important role in surging world trade: We wouldn’t be importing all those goods from low-wage countries if those countries were still, like India and Mexico in the 1970s, inward-looking economies living behind high tariff walls. There are, I think, two morals from this story. First, ideas matter. Maybe not as much as John Maynard Keynes suggested when he asserted that “it is ideas, not vested interests, which are dangerous for good or evil,” but they can have huge effects. Second, it’s a corrective against American hubris. We still tend, far too often, to imagine that we can shape the world as we like. But those days are long gone, if they ever existed. Hyperglobalization was made in Beijing, New Delhi and Mexico City, not in D.C.
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Aug 22, 2021 04:16
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Krugman is a dumbass and he’s only popular due to luck and do the pilgrims progress effect
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Aug 22, 2021 07:56
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https://www.nytimes.com/2021/08/30/business/supply-chain-shortages.html?referringSource=articleShare
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Aug 31, 2021 03:15
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