Containers piled up at the Yangshan Deepwater Port in Shanghai last month. The port currently has a shortage of the bigger, 40ft containers, according to Container xChange's Container Availability Index. Reuters
Containers piled up at the Yangshan Deepwater Port in Shanghai last month. The port currently has a shortage of the bigger, 40ft containers, according to Container xChange's Container Availability Index. Reuters
Containers piled up at the Yangshan Deepwater Port in Shanghai last month. The port currently has a shortage of the bigger, 40ft containers, according to Container xChange's Container Availability Index. Reuters
Containers piled up at the Yangshan Deepwater Port in Shanghai last month. The port currently has a shortage of the bigger, 40ft containers, according to Container xChange's Container Availability Ind

Shipping companies box clever to overcome container shortages


  • English
  • Arabic

The humble shipping container has a new status in the Covid-19 pandemic: hot commodity.

Shortages of the ribbed steel boxes that have plied the global economy for a half-century are plaguing trans-Pacific routes in particular. The dearth is boosting the purchase price of new containers and lease rates by 50%, snarling port traffic, adding surcharges and slowing deliveries heading into the holidays.

A surge in Chinese exports and robust consumer demand in the US help explain the tightness, and major shipping liners like Hapag-Lloyd are scrambling to reposition their bigger, 40 foot containers from less busy parts of the world. Nico Hecker, Hapag-Lloyd’s director of global container logistics, dubbed it a “black swan” moment.

The German sea freight company is “experiencing the strongest increase in 40 foot demand following one of the strongest decreases in demand ever”, Hecker said in a post on the company’s website last week. “The containers must be returned to China as quickly as possible to be equipped for an expected strong fourth quarter.”

The squeeze shows up in an indicator developed by Container xChange, an online platform based in Hamburg, Germany. The latest reading of its Container Availability Index was 0.04 for the 40-foot extra-tall boxes – the size popular for consumer products – in Los Angeles, while Shanghai slumped to 0.22. On a scale of zero to 1, the dividing line between surpluses and shortages is 0.5.

Dire predictions that global trade would collapse this year prompted container carriers to cancel sailings to underpin freight rates. Those forecasts proved far too pessimistic, though, and industry observers now say a sharp second-half rebound may mean container volumes for 2020 end up not far off levels reached in 2019.

Economists have long debated whether international commerce lifts all economic boats and many nowadays agree that it does, in theory at least. But the market for a commodity like shipping containers is very much a zero-sum game, where winners and losers are decided by who does and doesn’t have their hands on available supply.

“I’ve had no used containers for sale for three or four weeks now,” said Chris Osborne, managing director of Budget Shipping Containers in Birmingham, England. “I am missing out on sales, definitely, by not having the stock there but I’m also not losing them to competitors because they’re in the same boat.”

About 35 million shipping containers are currently in use globally, making some 170 million full trips a year, according to Florian Frese, marketing director at Container xChange. About 55 million of those trips are made when they’re empty – on returns trips or as shipping companies realign them with the demand.

The current scarcity means importers are facing longer waits for their goods and might pay extra fees to secure the transport equipment. The impact can ripple beyond the flow of goods between the world’s two largest economies.

“The more profitable the China-US lane becomes, the more incentivised carriers are to divert containers from other lanes, increasing the prices on shipping in secondary markets,” said Eytan Buchman, chief marketing officer at Hong Kong-based Freightos, an online shipping marketplace.

“Historically, this has been a driver of higher intra-Asia rates, with spare containers located in Asia diverted to the trans-Pacific route.”

Shipping liners own roughly half the world’s containers, and the rest are owned by lessors including Bermuda-based Triton International, whose US-listed shares jumped 34 per cent in the third quarter, more than quadruple the increase in the S&P 500 Index.

Shares of Textainer Group Holdings, a San Francisco-based container lessor, surged 73 per cent in the last quarter and CAI International, a leasing firm also based in San Francisco, jumped 65 per cent.

“We hear from customers that they expect a fairly significant container shortage to remain through [to] at least Chinese New Year” in mid-February, Brian Sondey, Triton’s chief executive, said on a conference call in October.

He said leasing rates for new containers were up “well over 50 per cent” from the second quarter and its inventory of 40 foot containers is as “close to full utilisation as you can get”. Triton ordered $350 million worth of new containers for delivery in the first few months of 2021.

The beneficiaries of such booming demand are Chinese manufacturers that dominate the global market for newly built containers, the price of which has increased to about $2,500 each, from about $1,600 a year ago.

Industry figures show the availability of dry-freight containers produced in China were down to about 250,000 20-foot equivalent units at the end of October, from 871,000 in May. Order books are full until April or May next year.

The Birkin bag is made by Hermès. 
It is named after actress and singer Jane Birkin
Noone from Hermès will go on record to say how much a new Birkin costs, how long one would have to wait to get one, and how many bags are actually made each year.

Sukuk explained

Sukuk are Sharia-compliant financial certificates issued by governments, corporates and other entities. While as an asset class they resemble conventional bonds, there are some significant differences. As interest is prohibited under Sharia, sukuk must contain an underlying transaction, for example a leaseback agreement, and the income that is paid to investors is generated by the underlying asset. Investors must also be prepared to share in both the profits and losses of an enterprise. Nevertheless, sukuk are similar to conventional bonds in that they provide regular payments, and are considered less risky than equities. Most investors would not buy sukuk directly due to high minimum subscriptions, but invest via funds.

The specs

Engine: 3.9-litre twin-turbo V8

Transmission: seven-speed

Power: 720hp

Torque: 770Nm

Price: Dh1,100,000

On sale: now

Empty Words

By Mario Levrero  

(Coffee House Press)
 

Sweet%20Tooth
%3Cp%3E%3Cstrong%3ECreator%3A%20%3C%2Fstrong%3EJim%20Mickle%3Cbr%3E%3Cstrong%3EStarring%3A%20%3C%2Fstrong%3EChristian%20Convery%2C%20Nonso%20Anozie%2C%20Adeel%20Akhtar%2C%20Stefania%20LaVie%20Owen%3Cbr%3E%3Cstrong%3ERating%3A%20%3C%2Fstrong%3E2.5%2F5%3C%2Fp%3E%0A
World record transfers

1. Kylian Mbappe - to Real Madrid in 2017/18 - €180 million (Dh770.4m - if a deal goes through)
2. Paul Pogba - to Manchester United in 2016/17 - €105m
3. Gareth Bale - to Real Madrid in 2013/14 - €101m
4. Cristiano Ronaldo - to Real Madrid in 2009/10 - €94m
5. Gonzalo Higuain - to Juventus in 2016/17 - €90m
6. Neymar - to Barcelona in 2013/14 - €88.2m
7. Romelu Lukaku - to Manchester United in 2017/18 - €84.7m
8. Luis Suarez - to Barcelona in 2014/15 - €81.72m
9. Angel di Maria - to Manchester United in 2014/15 - €75m
10. James Rodriguez - to Real Madrid in 2014/15 - €75m

Getting there
Flydubai flies direct from Dubai to Tbilisi from Dh1,025 return including taxes

The biog

Name: Dhabia Khalifa AlQubaisi

Age: 23

How she spends spare time: Playing with cats at the clinic and feeding them

Inspiration: My father. He’s a hard working man who has been through a lot to provide us with everything we need

Favourite book: Attitude, emotions and the psychology of cats by Dr Nicholes Dodman

Favourit film: 101 Dalmatians - it remind me of my childhood and began my love of dogs 

Word of advice: By being patient, good things will come and by staying positive you’ll have the will to continue to love what you're doing

Recipe

Garlicky shrimp in olive oil
Gambas Al Ajillo

Preparation time: 5 to 10 minutes

Cooking time: 5 minutes

Serves 4

Ingredients

180ml extra virgin olive oil; 4 to 5 large cloves of garlic, minced or pureed (or 3 to 4 garlic scapes, roughly chopped); 1 or 2 small hot red chillies, dried (or ¼ teaspoon dried red chilli flakes); 400g raw prawns, deveined, heads removed and tails left intact; a generous splash of sweet chilli vinegar; sea salt flakes for seasoning; a small handful of fresh flat-leaf parsley, roughly chopped

Method

Heat the oil in a terracotta dish or frying pan. Once the oil is sizzling hot, add the garlic and chilli, stirring continuously for about 10 seconds until golden and aromatic.

Add a splash of sweet chilli vinegar and as it vigorously simmers, releasing perfumed aromas, add the prawns and cook, stirring a few times.

Once the prawns turn pink, after 1 or 2 minutes of cooking,  remove from the heat and season with sea salt flakes.

Once the prawns are cool enough to eat, scatter with parsley and serve with small forks or toothpicks as the perfect sharing starter. Finish off with crusty bread to soak up all that flavour-infused olive oil.

 

GAC GS8 Specs

Engine: 2.0-litre 4cyl turbo

Power: 248hp at 5,200rpm

Torque: 400Nm at 1,750-4,000rpm

Transmission: 8-speed auto

Fuel consumption: 9.1L/100km

On sale: Now

Price: From Dh149,900

West Asia Premiership

Dubai Hurricanes 58-10 Dubai Knights Eagles

Dubai Tigers 5-39 Bahrain

Jebel Ali Dragons 16-56 Abu Dhabi Harlequins

ALRAWABI%20SCHOOL%20FOR%20GIRLS
%3Cp%3ECreator%3A%20Tima%20Shomali%3C%2Fp%3E%0A%3Cp%3EStarring%3A%C2%A0Tara%20Abboud%2C%C2%A0Kira%20Yaghnam%2C%20Tara%20Atalla%3C%2Fp%3E%0A%3Cp%3ERating%3A%204%2F5%3C%2Fp%3E%0A
Top 10 most polluted cities
  1. Bhiwadi, India
  2. Ghaziabad, India
  3. Hotan, China
  4. Delhi, India
  5. Jaunpur, India
  6. Faisalabad, Pakistan
  7. Noida, India
  8. Bahawalpur, Pakistan
  9. Peshawar, Pakistan
  10. Bagpat, India

Super Rugby play-offs

Quarter-finals

  • Hurricanes 35, ACT 16
  • Crusaders 17, Highlanders 0
  • Lions 23, Sharks 21
  • Chiefs 17, Stormers 11

Semi-finals

Saturday, July 29

  • Crusaders v Chiefs, 12.35pm (UAE)
  • Lions v Hurricanes, 4.30pm