/ By tjchinafreight ivy / Cargo • Shipping

Port Klang fire: 22 containers burned, 38 damaged

A severe fire broke out at the Westports terminal in Port Klang, Malaysia's main container port, with 22 containers burned and 38 damaged.

Port Klang Authority general manager K. Subramaniam said the fire started at 4.15pm (local time) on April 4. At around 4.45pm, the Port Police Control Centre (PPCC) received a call about a fire in the container yard.
After answering the call, the PPCC called the Fire and Rescue Department (FRD) from Port Klang, which deployed two fire trucks to extinguish the blaze shortly after.
It took firefighters 11 hours to put out the blaze, which was fully extinguished around 3 a.m. on April 5.

Subramaniam pointed out that the container holds general cargo and does not contain dangerous goods. Affected box contents include auto parts, cotton products, baby walkers, audio equipment and lubricants.

"At this time, we are unable to determine the extent of the damaged containers. All affected box operators will be notified in due course," Westports said in a statement.
"There was no damage to port equipment and infrastructure. We are also pleased to inform that there were no injuries or disruptions to our operations.
"We would like to thank everyone involved in helping us put out the fire, especially the FRDs from various stations."

While investigating the cause of the fire, Subramaniam said: "Other than the blockade of the fire area for investigation, the container cranes were not affected and other areas of the port were operating normally."

Selangor Fire and Rescue Department chief Norazam Khamis said the fire initially spread to eight containers, which were stacked in two rows by weight. Westports crews attempted to move other containers to prevent the fire from spreading.

/ By tjchinafreight ivy / Shipping

Over 20 ships awaiting loading in Qatar port! Global LNG shortages worsen

The global LNG shortage has worsened, with the number of empty ships waiting to unload from Qatar, the world's top exporter, to the highest level in nearly a year.

As many as 21 LNG carriers are currently awaiting shipments off the coast of Qatar, according to data compiled by Bloomberg. Analysts at Bloomberg New Energy Finance (NEF) pointed to the recent surge in empty ships waiting to be loaded, raising concerns that in the past few more than 20 vessels were waiting to be loaded at Qatari ports.

Bloomberg analysts believe there could be several reasons for the surge in empty ships, such as a technical problem at an LNG processing plant or upstream facilities reducing production, or Qatargas changing its maintenance schedule, but in this case it should be There won't be so many ships lined up to load because buyers are notified in advance.

Qatar’s LNG exports in February were well below the average for the same period over the past five years, and total LNG exports in March were estimated at 6.5 million tonnes, also lower than the same period in the previous two years.

The LNG ships have sailed back to Qatar after unloading in China, Japan, India and Italy, according to data compiled by Bloomberg. Typically, Qatar ships most of its LNG to Asian markets at this time of year, so Pacific buyers will be more sensitive to any supply disruption than Atlantic buyers.

Qatargas has yet to comment. Energy data provider Kayrros said Qatar Gas' No. 6 LNG liquefaction and purification plant was closed for more than a month before reopening on March 20.

Global LNG shortages intensify as Qatar exports dwindle and buyers in Asia and Europe try to find alternative sources of LNG outside of Russia, tightening the market and any supply disruption or production cuts will push up spot LNG prices.

Qatar Energy Minister Saad al-Kaabi said Qatar will continue to supply LNG to Europe and will not transfer LNG to other customers. Still, he refused to impose sanctions on Russia, reiterating that a complete ban on Russian gas supplies to Europe was "practically impossible". Qatar supplies LNG to some European countries in the form of convertible contracts.

/ By tjchinafreight ivy / Shipping

The container shipping market is in short supply, and the price of second-hand ships has skyrocketed

Since the outbreak of the epidemic, the supply and demand of the container shipping market has been unbalanced, and the freight rate has skyrocketed. Shipping companies that are "not worried about money" have bought and leased them. The amount of scrap is almost zero.

According to Alphaliner data, container lines have gone on a spree to acquire more than 500 container ships in the second-hand ship market in the past 18 months. Among them, Mediterranean Shipping was the largest buyer, purchasing a total of 169 second-hand ships with a total capacity of 636,900 TEU; followed by CMA CGM, which purchased 62 ships with a total capacity of 207,000 TEU. Maersk Line only ranked third, purchasing 27 ships of 141,600 TEU. The fourth is Wan Hai Shipping, which purchased 23 ships of 139,700 TEU.

ALphaliner pointed out that at the beginning of the market recovery, the price of second-hand ships was still at a low level, which made it a better choice for container shipping companies to buy and lease. At the same time, many small non-operating ship owners (NOO) are struggling on the brink of bankruptcy due to years of low rental income, and it is difficult to resist the high prices offered by container shipping companies.

Currently in the second-hand ship market, container ship prices have soared to record highs. The hot sale situation has also made the scrapping of container ships almost zero, and the capacity in the charter market has plummeted by 1.6 million TEU.

At the same time, orders for new container ships also hit a record high last year. Clarkson's data shows that in 2021, the order volume of container ships will reach 569 ships of 4.3 million TEU, and the contract value is as high as 42.8 billion US dollars. This order level is even 29% higher than the previous record level of 3.3 million TEU in 2007. 3.5 times the average order volume in the 10 years ending in 2020.

Since 2022, there have been 124 new orders in the container ship market, with a total capacity of about 857,600 TEU. It is estimated that the order volume of container ships will remain at a high level after 2022.

/ By tjchinafreight ivy / Shipping

Vietnam accelerates container production to compete with China

Chinese factories now account for more than 96% of the world's dry container and 100% of the reefer container market, and Vietnam is joining the fray and is providing the world with a new container export destination.

Vietnam's Hoa Phat Group, Southeast Asia's largest steelmaker, is making a foray into container manufacturing.
It sees potential synergies with its core steel production business.
Hoa Phat started construction of its plant Hoa Phat Container Manufacturing in Vung Tau province in December and is expected to be operational by the end of this year with an annual production capacity of 500,000 TEUs, all using steel produced in-house.
Two South Korean companies - Seojin Systems and Ace Engineering - have also built container factories in northern Vietnam, which are expected to be operational later this year.

Hefa Group: Plans to supply containers to the market in the fourth quarter

Nguyen Manh Tuan, vice chairman of Hoa Phat Group, said: "Shipping containers are part of the Hoa Phat company ecosystem, and Hoa Phat started building the container manufacturing plant amid a global shortage of shipping containers."

Hefa Group planned to start construction of the factory in June 2021, but due to the impact of the fourth wave of the new crown epidemic, the project was officially launched in November 2021, five months later than planned.

But after 3 months of construction, 5 workshops, with a total construction area of ​​nearly 7 hectares, began to erect columns. On February 22, 2022, the construction of the first truss of workshop 5 was completed.

Vu Duc Sinh, head of the container manufacturing division of Hoa Fatt Group, said the first machines and equipment at the plant are expected to arrive this month and construction will be fully completed by April. The construction of the factory is accelerating. There are 3-5 contractors on the construction site, who distribute the projects equally and strive to complete the capital construction within 6 months from the date of commencement of construction. We want to build factories as soon as possible to take advantage of the shortage.

In Vietnam, Hoa Phat was the first container manufacturer. Tuan explained that the high price of weathering hot rolled coil steel used to make containers would cost the company if imported, and we at Hoa Phat can produce this steel.

The Hefa Group's container factory will be commissioned in the third quarter of 2022, and products will be brought to market from the fourth quarter of this year. The plant is expected to have a capacity of 200,000 TEU per year by the end of 2023.

/ By tjchinafreight ivy / FBA

What is the difference between overseas warehouse and FBA?

  • FBA, or Fulfillment by Amazon, means that sellers send products sold on Amazon directly to local warehouses. When a customer places an order, the Amazon system automatically completes the delivery.
  • Overseas warehouses refer to storage facilities established overseas. Cross-border e-commerce enterprises export goods to overseas warehouses in batches according to general trade methods. Once the order is placed, the item is delivered to the consumer.

Advantages of overseas warehouses

Faster delivery. It effectively reduces order response time by 50-70% compared to shipping from China. Additionally, it improves user experience and greatly reduces product turnaround time.

Reduce logistics costs. Through centralized delivery to overseas warehouses, local express delivery in the United States can reduce delivery costs by 30-50%.

FBA inventory adjustment is easy. For sellers, the overseas warehouse is the buffer warehouse of Amazon FBA, which is convenient and flexible to adjust the FBA inventory.

Disadvantages of overseas warehouses

Pay storage fees. The use of overseas warehouses requires payment of a certain fee, which is generally charged on a daily basis. And the cost of warehousing in different countries is also different, and sellers need to calculate the cost by themselves.

In stock. The premise of entering overseas warehouses is that sellers need to have a certain amount of inventory, which means that they need to stock up in advance, which will bring the risk of slow sales. And not suitable for sellers who sell special customized products.

Cash flow is inconvenient. Due to the large amount of stocking to overseas warehouses, the capital investment in stocking, logistics, warehousing, etc. is large, which can easily lead to a breakdown in the capital chain.

Sellers have high requirements for warehouse management data monitoring. Sellers need to monitor the detailed data of incoming and outgoing shipments, as well as putting on and off the shelves, otherwise it will easily lead to loss of goods or data mismatch. Some Amazon sellers responded that the inventory quantity did not match the actual number of products sold. Since Amazon has a complete warehouse management system, third-party overseas warehouses cannot guarantee that there will be no problems.

In essence, there is no difference between overseas warehouses and FBA. Both provide sellers with comprehensive warehousing and fulfillment services. However, there are obvious differences between the two in terms of service content and form.

1. The difference between service providers: FBA is Amazon's official warehouse distribution service, and after-sales service is provided by Amazon; overseas warehouses are provided by third-party service providers, responsible for the warehousing and distribution of sellers' products.

2. Different service forms. Once the seller has sent the goods to FBA, there is no need to deal with shipping related issues. The whole process from sorting to shipping is completed by FBA. The overseas warehouse is divided into two parts, first sorting and packaging in the warehouse, and then entrusting the local express company to complete the delivery service.

3. The service content is different. The service content of FBA is relatively simple, that is, it simply helps sellers deliver goods. The service content of overseas warehouses is more abundant. In addition to basic warehouse distribution, it also provides related services such as labeling and labeling, single-piece delivery, transit replenishment, quality inspection, and front-end logistics. For example, worry-free overseas warehouses can also realize customized services according to customer requirements.

4. Overall price difference. Combining all services, FBA is more expensive, while the overall cost-effectiveness of overseas warehouses is higher.

Other differences

Choose:

Amazon FBA warehouse has certain restrictions on the size, weight and category of products, so the choice is biased towards small, high and high-quality products

DH overseas warehouses have a wider range of choices than FBA warehouses.

Product:

FBA does not provide assembly services, and requires sellers to affix the outer box label and product label before entering the warehouse. If the product label is found to be damaged, it will be returned for repair.

DH overseas warehouses will provide sorting and assembly services before products are put on the shelves.

/ By tjchinafreight ivy / Shipping

FOB Shipping Point vs. FOB Destination

Container ship in the harbor in Asia 

International business terms (incoterms) were designed by the International Chamber of Commerce (ICC) to simplify international trade by creating a common standard language, a globally recognized list of terms related to the international transport and transport of goods.
Importers and exporters need to be proficient and proficient in many terms. Some terms are more common than others, such as Free On Board (FOB), Free Carrier (FCA) and Ex Works (EXW). FOB, while common, is largely misunderstood.
Although their language is largely drafted in legal language, it is the responsibility of all parties involved in a shipment to ensure that they understand all Incoterms, otherwise a simple shipment can turn into a costly accident .

Incoterms are important for several reasons. If you find yourself wondering what FOB means in shipping, be sure to take the time to understand FOB shipping

Free shipping on board

The FOB point of dispatch, also known as the FOB origin, is when title and responsibility for the goods pass from the seller to the buyer when the goods are placed on the delivery vehicle.
Since the FOB shipping point transfers title to the shipment of the goods when they are placed at the shipping point, legal title to those goods passes to the buyer. Therefore, the seller is not responsible for the goods during delivery. FOB Shipping Point is a further limitation or condition of FOB as liability changes hands at the seller's shipping terminal.

For example, suppose that ABC Company in the United States purchases electronic equipment from its supplier in China, and the company has a FOB point-of-ship agreement. If the nominated carrier damages the package during delivery, ABC Company will be solely responsible and cannot claim compensation from the supplier for the loss or damage. Suppliers are solely responsible for bringing electronic equipment to the carrier.

Free destinations on board

Conversely, for FOB destinations, title transfers at the buyer's loading dock, PO box, or office building. Title to the goods passes from the seller to the buyer once the goods have been delivered to the place designated by the buyer. Therefore, the seller legally owns the goods and is responsible for the goods in transit.

Types of free destinations on board

  • FOB freight prepaid and allows the named seller to be obligated to pay the freight and have the goods in transit. The seller bears the risk of loss of or damage to the goods in transit. Title to the goods passes to the buyer at the buyer's place of business.
  • FOB shipping prepaid and adding the specified seller is obligated to pay shipping. However, the seller charges the buyer for shipping. The seller bears the risk of loss of or damage to the goods in transit because the seller owns the goods in transit. Title to the goods transfers to the buyer's place of business.
  • FOB freight collect specifies that the buyer must pay the freight upon receipt of the goods. However, the seller bears the risks associated with shipping the goods because the seller still owns the goods during the shipping process.
  • FOB freight collect specifies that the buyer must pay the freight. However, the buyer deducts the fee from the seller's invoice. The seller is responsible for the goods because the seller still owns the goods during shipping.

Main difference

Another key difference between the two terms is how they are calculated. Since the buyer is liable after the goods are shipped, the company can record an increase in its inventory at this time. Likewise, the seller records the sale at the same time. If the goods are damaged or lost in transit, the buyer can file a claim as the company holds title during delivery.

The accounting rules for FOB destinations have changed. In this case, the seller completes the sale on its records once the goods arrive at the receiving dock. That's when the buyer records the increase in their inventory.

There are also differences in the division of costs. For the FOB shipping point option, the seller bears the shipping costs and charges until the goods arrive at the port of origin.

Once the goods are loaded on the ship, the buyer is responsible for all costs associated with shipping, as well as customs, taxes and other charges. For FOB destinations, the seller bears all costs and expenses until the goods arrive at the destination. Once in port, all costs - including duties, taxes and other charges - are borne by the buyer.

/ By tjchinafreight ivy / Shipping

Shipping companies are buying container ships?

According to Alphaliner, some ocean carriers are turning to buying ships to increase capacity, rather than chartering them, reducing capacity in the containership leasing market by 1.6 million TEU.

In addition, there are concerns in shipbroker circles that this reduction in open capacity will weaken the industry's ability to cope with the normal seasonal peak and low seasons of liner trade.

According to shipbrokers, the loss of capacity controlled by NOOs (non-operating shipowners) began in August 2020, when shipping lines, flush with cash due to soaring freight rates, began to add capacity to their own fleets.

In just 18 months, more than 500 container ships have been sold to liner operators through the secondary market, a massive fleet exodus rooted in high demand for freight post-COVID-19, Alphaliner said.

"The huge demand for container ships has caused container ship rents to soar to levels never seen before in the history of container shipping, almost overnight."

"MSC has been the main buyer so far, buying 169 second-hand container ships with a total capacity of 636,900TEU," Alphaliner said.

CMA CGM was the second most active shipping company in the container ship market, purchasing 62 vessels with a total capacity of 207,000TEU; Maersk ranked third with 27 vessels purchased with a total capacity of 141,600TEU; followed by Wanhai with 23 vessels ship with a total capacity of 139,700TEU.

However, some shipping companies have decided to take advantage of the freight rate gained on newbuildings to increase dividends to shareholders, or to seize opportunities in the charter market for longer-term fixed charters.

According to Alphaliner data, in the past 20 months, non-operating shipowners have ordered 175 ships with a total capacity of 710,321TEU, more than half of which have signed long-term charter contracts with shipping companies.

“The low number of newbuildings relative to the loss of capacity suggests that non-operating owners’ fleets need to order more 1,000-9,000 TEU-sized container ships,” the shipbroker said.

But he added that several factors were preventing owners from ordering new ships, including soaring costs, longer lead times, and uncertainty over environmental regulations and fuel options.

Meanwhile, sources at shipbrokers said they were concerned about the current lack of open container ship capacity in the market, as well as the lack of spare container ships in the future.

"At the moment, the outlook is not very good," said one broker. "However, we think that when the situation returns to some form of normalcy, shipping companies may consider moving some of the excess smaller ships they have purchased. Rent out, that will give us something to sell," he said.

/ By tjchinafreight ivy / Shipping

Ownership-based container terminal types

What is a container terminal?

Container terminal or container port (used interchangeably) is a term designated for an intermediate destination facility that enables containers to switch modes of transport on their way to their final destination.
Many times, cargo arrives at a container terminal on a single vessel and is distributed to inland customers by multiple modes of transport. The terminal is also an area dedicated to maintenance and temporary storage of containers. Occasionally, the unloading, loading and storage of the cargo in these containers is also carried out here.

Container Terminal Type

Container terminals around the world are divided into five categories based on their ownership:

Public terminals, operator leased terminals, joint ventures between operators and terminal operators, terminal built and operated by operators, and finally terminals built and operated by operators. Below is a brief overview of the five terminals -

1. Public Pier
All facilities of the public terminal, such as loading and unloading processes, tariff rates and allocated entry and exit locations are shared by all shipping lines and operate on a first-come, first-served basis. Regular duty rates apply to container handling and other related charges, or are otherwise discounted or at agreed rates.

2. The carrier leases a dedicated terminal
These are the result of major carriers working with port authorities, culminating in the signing of long-term leases that are exclusively used by these carriers. The carrier is responsible for paying the costs incurred as carrier preference. For example, Maersk has a number of terminals that have signed long-term use contracts. In addition, some shipping companies have formed partnerships to share terminal usage using multi-user long-term contracts.

3. Terminal construction and operation of terminals
Terminal operators invest directly in the construction, operation and handling of terminals. The operator enters into a lease contract with the port authority by depositing a sum into the gross handling charge of the container business.

4. Operators – build and operate terminals
The method is similar to that used for terminal construction and operation of terminals. In this type of licence, one or more carriers jointly lease a container terminal through deposits with port authorities or direct investment in construction, operation and handling services

5. Joint venture between carrier and terminal operator
In this type of contract, an agreement is reached between the shipping company and the terminal operator, thus forming a company. Direct investment, combined terminal operations for safe, prioritized and efficient container handling.

/ By tjchinafreight ivy / Shipping

How to deal with the problem of overweight containers?

There is information on the maximum weight limit on the unpacking door of each container, such as MAX GROSS: 30480KGS. This means that your box with the goods cannot exceed this weight. Tare weight--20GP: 2200KGS, 40: 3.720-4200KGS, some HQ will have MAX GROSS: 32000KGS.
This is the maximum strength that the container body can withstand. If the loading exceeds this limit, the container body may be deformed, the bottom plate will fall off, and the top beam will be bent. All the resulting losses will be fully borne by the loader. At present, most professional container terminals in China have installed automatic weighbridges. Therefore, as long as the container exceeds the weight limit of the container, the terminal will refuse to accept the container. Therefore, it is recommended that you clearly see the weight limit on the container body before packing, so as to avoid unnecessary repacking operations.

Overweight containers are a very serious problem. As container vessels become larger and containers are stacked higher to keep up with the growth of world trade, overweight containers can:

Wrong ship stowage decision
Restocking the container (and resulting delays and costs) if overweight is determined
folded container stack
Containers lost in water (overweight and
overweight container)
Cargo Liability Claims
Chassis damage
ship damage
Vessel stability and stress risk
Risk of personal injury or death to seafarers and shore workers
Service plan integrity compromised
Correctly declare supply chain service delays for container shippers
Confirmed, booked and available loads are closed at the last minute when the actual weight on board exceeds the declared weight and the total cargo weight exceeds the ship limit or port draft limit.
Loss of revenue and earnings
Liability for overweight accidents and fines on the road, and the resulting time and administrative effort and costs to seek compensation from responsible parties
Impairs the optimum trim and draft of the vessel, resulting in compromised vessel efficiency, suboptimal fuel usage and increased vessel exhaust emissions.

What should I do if I am overweight?
This is mainly divided into overweight port area, overweight shipping company, overweight port of destination

1. The shipping company is overweight
Discuss with the shipowner, make up the overweight fee, and the rest will go as normal;

2. The port area has its own regulations for overweight
If you find that you are overweight when entering the port, you need to negotiate with the port area and pay the overweight fee plus manual handling fee or take out the box and repack it;

3. The destination port is overweight
Generally, if the destination port is overweight within a certain range, the fine can be solved; if the overweight is serious, the cranes along the way cannot be loaded and can only be transferred to a nearby port or returned to the original road.

/ By tjchinafreight ivy / Shipping

Introduction to container freight terminology, freight forwarding and foreign trade notices

Container

A sea container (also known as a container, freight container, intermodal container, ISO container, hi-cube container, box, conex case, and sea tank) is a steel container that can be moved repeatedly within a product for safe and efficient movement Use an intermodal freight system.
Container shipping comes in many different sizes and options, including specialty options such as hanging garment containers, half-height containers, bulk shift containers and tanks. While these all have their uses, they are very niche.

Container leasing
The container leasing market has been fast-growing over the years. Today, around 55 % of the global container fleet is owned by leasing companies. Making container leasing a force to be reckoned with.
Are you considering leasing containers instead of buying? In that case, keep reading. We’ll tell you all you need to know about the different types of container leasing. As well as weigh the pros and cons of buying containers vs leasing them.

Container terminal
In container transportation, the specific handling department for the exchange and storage of boxes or cargoes. It authorizes the carrier or its agent to carry out the following business:
(1) Exchange and storage of FCL shipments.
(2) Those who have a container freight station shall handle the handover of LCL goods.
(3) Arranging the berthing of container ships, loading and unloading containers, and preparing stowage plans for each voyage.
(4) Handle the compilation and signature of relevant shipping documents.
(5) Prepare and sign the relevant documents for the entry, exit and circulation of the container using the means of transport.
(6) Handle the inspection and maintenance of containers, vehicles, loading and unloading tools, as well as cleaning and fumigation of empty containers.
(7) Send and receive, store and keep empty boxes.
(8) Arrange the stacking of empty boxes and heavy boxes in the yard, and prepare a site allocation plan.
(9) Other related business work. Container loading and unloading areas are generally composed of dedicated docks, frontiers, yards, freight stations, command towers, repair departments, gates and offices. Sometimes the storage yard or freight station can be extended to the transfer station of 5~15 kilometers in the urban area.

Container front yard (marshalling yard)
In front of the container terminal, in order to speed up the loading and unloading of ships, the container is temporarily stacked. Its function is: before the container ship arrives at the port, the export containers are neatly stacked in a planned and orderly manner according to the stowage requirements, and the imported containers are temporarily stacked in front of the wharf during unloading to speed up the loading and unloading operations of the ship.

sea freight

Container yard
A place where heavy or empty containers are handed over, kept and stacked. In some countries, container yards are not divided into front yards or rear yards, which are collectively referred to as yards. The container rear yard is an integral part of the container handling area. It is the place where the FCL of the container transportation "on-site" handover method is handed over (actually, the handover is carried out at the "gateway" of the container unloading area).

Empty container yard (van pool)
A site dedicated to the collection, storage, storage or handover of empty containers. It is specially set up when the container handling area or the transfer station yard is insufficient. This kind of yard does not handle heavy box or cargo handover. It can be operated independently, or it can be set up outside the area by the container handling area. Some capitalist countries, operating such empty container yards, must declare to the shipping association.

Container freight station
The place where the ship and cargo parties handle the handover for the packing and unpacking of the LCL cargo. The carrier can only entrust the operator of one container freight station in a port or inland city. It handles the following main business on behalf of the carrier:
(1) Tally and handover of LCL cargo.
(2) If there is any abnormality in the inspection of the appearance of the goods, an annotation shall be processed.
(3) The stowage and packing of the LCL cargo.
(4) Unpacking and storage of imported unpacked goods.
(5) Seal and issue a station receipt on behalf of the carrier.
(6) Handle various documents and preparations.

The maximum compensation amount that the carrier should bear in the event of cargo damage during container transportation. Limitation of liability for LCL shipments is the same as for conventional shipments. Compensation for FCL is based on some current international precedents. If the number of pieces of goods in the box is not listed on the bill of lading, each box is used as a claim calculation unit. If the number of pieces in the box is listed on the bill of lading, it is still calculated according to the number of pieces. If the damage and loss of the goods are not carried out by sea, but occurred during inland transportation, the maximum compensation amount for land transportation shall be handled. If the container is owned or provided by the shipper, in the event of loss or damage, the responsibility for the loss or damage is indeed the responsibility of the carrier, and it should also be regarded as a claim calculation unit.