Shipping Australia stated that in order to reduce the backlog of empty containers at the port, liner companies directly incurred expenses and abandoned cargo operations , indicating that liner companies have provided great support for maintaining the normal operation of the Australian supply chain.
The accumulation of empty containers has always been a problem faced by major ports in the world. In Sydney, weather and other factors have exacerbated this problem, affecting the exchange of import and export containers by liner companies. In order to alleviate this problem, liner companies are increasing the number of ships at the port and paying additional ship operations and port fees for this.
New South Wales Minister of Transport and Roads Andrew Constance noted that the number of empty containers exported recently reached a record level . More than 78,000 empty containers were exported in October 2020, and more than 75,000 empty containers were exported in November. The average export volume of empty containers in the first 12 months was about 64,000.
In order to reduce the accumulation of empty containers at the port, the liner company was forced to reduce the export of heavy containers:
●At present, a liner company has successfully reduced its empty container inventory from 13,000 TEU to 5,000 TEU;
● Another liner company reduced its empty container inventory from 25,000 TEU to 16,000 TEU;
●Some companies have completely emptied the empty container inventory in New South Wales;
●A ship on the route from Northeast Asia to New Zealand has been transferred to Sydney Harbour to deliver empty containers;
●The two ships will cross Melbourne and stop at Sydney and Brisbane only to transport empty containers;
●A ship normally deployed on the Singapore-Fremantle route will stop service and transfer to the Singapore-Sydney-Singapore route to load empty containers. The ship has already picked up empty containers twice before;
●A liner company deploys two ships specifically for transporting empty containers during the peak season-one with a capacity of about 2200TEU and the other with a capacity of about 2800TEU;
● Another liner company has transported more than 12,000 FEU and more than 9,000 TEU. This company also temporarily deployed a ship to load 2,114 empty containers;
●In November last year, a liner company dispatched an empty ship to transport 1,384 empty containers, and it took 7 days to wait for the berth. Public data shows that in late November, the rent of a 2500TEU container ship was $15,500/day, and the rental price of 8,500TEU was $36,000/day, in addition to other costs such as crew wages and fuel.
In order to alleviate Australia's logistics supply chain difficulties, liner companies have undertaken a heavy financial burden . For example, the round-trip journey from Singapore to Sydney exceeds 9,500 nautical miles, and it takes at least 16 days to travel at a speed of 24 knots per hour (not including port time). Including crew wages, fuel costs, insurance fees, lubricating oil fees, storage fees, crew replenishment, chartering fees, tugboat fees, pilotage fees, mooring fees, port fees, etc., a 4250TEU ship needs 150 per voyage. Ten thousand Australian dollars. And this voyage loaded all empty containers, without any freight income.
According to the Shanghai Export Container Freight Index, the current freight rate of the Singapore-Fremantle route is US$2,431/TEU. It is roughly estimated that the opportunity cost of this voyage exceeds US$10 million.
There is no doubt that in order to reduce the accumulation of empty containers, these liner companies are paying a lot of money and giving up a lot of freight revenue. Faced with unprecedented demand growth, liner companies are doing their best to relieve the backlog of empty containers to ensure the normal flow of international shipping containers in the supply chain. At present, the accumulation of empty containers at the port is improving.
