Shipping and Maritime

softwood log exports

Germany Exported Logs at Record Pace in Early 2020, with Almost 50% Destined for China

Aug. 30, 2020 - The log market in Germany has been extremely volatile in the first half of 2020, with high demand from the export market and a tight supply of fresh green logs. When the Coronavirus Epidemic forced sawmills to close in March, domestic demand for sawlogs fell and the price increases seen earlier in the quarter reversed – resulting in both domestic and export prices falling.

Sawlog prices varied throughout the country depending on the level of local supply, the quality of the beetle-killed timber, the availability of fresh logs, and the competition from log exporters.

Log prices also varied due to contract volumes and spot purchases. Towards the end of the quarter, spot prices fell to levels that barely covered the costs for logging and hauling the timber. The 1Q/20’s estimated average sawlog price was an increase from the previous quarter but substantially lower than the 1Q/19, according to the Wood Resource Quarterly.

Softwood log exports from Germany have increased dramatically over the past five years, from 2.1 million m3 in 2014 to 7.4 million m3 in 2019. The oversupply of logs resulted in record high exports in the 3Q/19 followed by two quarters of q-o-q declines (see chart).

Despite the reduction in exports during the winter months, total shipments during the first four months of 2020 were up 38% as compared to the same period in 2019.

China has quickly become the largest market for German logs, accounting for almost 50% of all exported logs so far in 2020. From January to April this year, almost 2.4 million m3 of softwood logs were shipped to China. Log exportation from Europe to Asia is a recent trend. As late as 2017, there were practically no shipments of German logs outside of Europe.

Log export prices were fairly stable during most of 2019 but started to decline in late 2019 and early 2020. In March and April 2020, average prices were down about 14% as compared to the same months in 2019. Prices for logs destined for China have also declined substantially from early 2019 but are still nominally higher than the prices for logs shipped to other markets.

The large supply of logs in Germany has had little impact on the consumption of logs by the domestic sawmilling industry. The increase in lumber exports has been less dramatic than that of logs, with the y-o-y rate of change actually falling the past three years, from 12% (2015 to 2016) to 6% (2018 to 2019).

Wood Resource Quarterly is published by Wood Resources International, an internationally recognized forest industry consulting firm. For further information visit: www.woodprices.com.

SOURCE: Wood Resources International LLC
 

CMA CGM has Launched New Container Service to the Port of Gothenburg

Aug. 18, 2020 - On 31 July, the shipping company CMA CGM launched a new container service, adding a new link between Gothenburg and Hamburg. The new service includes calls at Gothenburg every Friday, initially using a vessel with a capacity of over 1,000 TEUs.

“CMA CGM is a leading worldwide shipping group, and this is yet another step in our ongoing strategy for the Swedish market. The launch of this new service will enhance the potential for Sweden to link into our extensive global service network,” said Linus Ljungmark, General Manager at CMA CGM Scandinavia.

The service will be operated under the name Scandinavian Shuttle Service, departing from Gothenburg every Friday, and arriving in Hamburg the following Sunday/Monday. Initially, the vessel Aries J, with a capacity of over 1,000 TEUs, will be used.

“We are extremely pleased to see that CMA CGM is continuing to invest offensively, and particularly so as it has chosen the Port of Gothenburg as a focal point. The Port acquires a new service which will broaden our offering even further, opening up new potential for Swedish industry to reach its global markets,” said Claes Sundmark,” Vice President, Business Area Container, RoRo & Rail at the Gothenburg Port Authority.

CMA CGM – one the world’s largest container lines – is part of the shipping company alliance “Ocean Alliance” along with Cosco, Evergreen, and OOCL.

SOURCE: Port of Gothenburg
 

MSC’S New Santana Service Connects Asia and North America

Aug. 19, 2020 (Press Release) - In anticipation of continuous strong Transpacific market demand, MSC is pleased to announce its new Santana service for the North American west coast. The service will commence at the end of August in Yantian and will remain in place until further notice.

The Santana service’s full rotation will be:

  • Yantian – Shanghai – LA/LGB – Vancouver – Busan – Yantian

Besides allowing for added capacity to handle the stronger volume demand, the Santana service will offer market-competitive transit times into the U.S. West Coast.

SOURCE: MSC
 

Intermodal Association of North America Honors Vincent Marino with Silver Kingpin Award

Vincent J. MarinoAugust 19, 2020 – The Intermodal Association of North America (IANA) announced that Vincent J. Marino, President and CEO of the Marino Group, will be honored with the 2020 Silver Kingpin Award in an online presentation to be held Monday, September 14th.

The Silver Kingpin, the industry’s most prestigious award, recognizes an individual’s long-term contributions to intermodalism. The award was initiated in 1977 by the National Piggyback Association.

Marino has spent his entire 46-year career in the intermodal industry. Under his leadership, the Marino Group, established in 1971 and headquartered in Charleston, South Carolina, has grown into a network of maintenance & repair and over-the-road repair companies. Other business areas include equipment modification/sales and depot services in the East Coast, Gulf & Midwest markets.

“Vince has been a champion of intermodal for many years,” said Joni Casey, President and CEO of IANA. “His contributions have been and continue to be focused on ensuring the safety and integrity of intermodal equipment. IANA appreciates Vince’s industry leadership and support.”

A native of Brooklyn, New York, Marino graduated from New York University with a B.S. in Business Administration. He is a past Chairman of the Maritime Association of South Carolina and served on the Board of Directors of the Charleston Metro Chamber of Commerce. He also currently serves on IANA’s Operations and Maintenance & Repair committees.

IANA’s roster of more than 1,000 corporate members includes railroads, ocean carriers, ports, intermodal truckers and over-the-road highway carriers, intermodal marketing and logistic companies, and suppliers to the industry.

SOURCE: Intermodal Association of North America
 

Recovered paper shipment

Global Shipping Companies End Recovered Paper Exports to China

By Tim Woods Managing Director of IndustryEdge (for Forest2Market's blog)

July 20, 2020 - Recovered paper shipments to China could cease before the end of 2020, with global shipping companies now rejecting shipments for delivery after the end of September. The second and fifth largest global shipping conglomerates (Mediterranean Shipping Company [MSC] and Hapag Lloyd) have announced separately that they will cease shipping recovered paper to China before the end of 2020.

The move by the shipping lines is in response to Chinese laws that were introduced in late April that move China much closer to its stated aim of ending recovered paper imports entirely by the end of 2020.

Key Points:

  • Chinese officials have repeatedly signaled an end to imports of recovered paper
  • In April, China tightened its solid waste management laws
  • In late June, the Chinese Government announced it would ban the importation of solid waste from 2021
  • Major shipping lines are getting ahead of any bans, reducing their potential liabilities

It appears that both companies plan to cease taking containers that would be delivered to China after the beginning of October, as part of a risk management strategy. IndustryEdge was recently advised by a client that other shipping companies are also conducting “consultations” on the future of recovered material shipping to China.

In the interim, China’s import permits continue to be metered out on a national needs basis, leaving exporters from countries like Australia and New Zealand uncertain about even short-term shipments.

Month-on-month permits are extremely volatile and expected to result in China’s total recovered paper imports declining to less than 5 million tons in 2020, down from a peak of around 28 million tons in 2017.

This development must be viewed alongside the other significant development in global fiber markets of the last two years: the rapid expansion in the number of mills producing recovered paper pulp for shipment to China. Mills have been converted and established in North America, Malaysia and Vietnam, most significantly.

The likelihood is that by year’s end, Australian suppliers will be seeking alternative markets to China in larger proportions than ever before. Over the year-ended May 2020, Australian recovered paper exports to China totaled 249.2 kt (valued at AUDM41.2), down 54 percent on the prior year. In fact, at just 8,579 tons in May 2020, Australia’s exports of recovered paper to China were their lowest in more than seven years, with average prices at AUDFob122/t, within range of the lowest monthly average price ever recorded.

Indonesia is the next most likely destination for Australia’s recovered fiber. Over the year-ended May 2020, Indonesia received 295.5 kt of Australian recovered paper (valued at AUDM52.8). However, Indonesia’s market is already close to capacity and is expected to be swamped with potential supply options, placing obvious pressure on prices. Indonesia has recently repositioned its recovered paper import quality requirements, and countries like Korea are in the process of doing the same.

One possibility under active consideration in some parts of the recovered paper sector is whether exports could be allowed into countries making recovered paper pulp that will ultimately be sent to China. That consideration alone is an indication that recovered paper pulping, for the international market, needs to be on the Australian infrastructure investment table right now.

About IndustryEdge

IndustryEdge is Australia and New Zealand’s dedicated provider of market intelligence, trade data and analysis in the paper, paper products, pulp and recovered paper sectors. For further information, visit: industryedge.com.au

Forest2Market provides pricing data, supply chain expertise and strategic consulting services to participants in the global wood and fiber supply chain. The Forest2Market's unique databases contain more than 400 million rows of transaction data; they are the foundation for all analytics available in the firm's business intelligence platform, SilvaStat360, as well as client resource studies and consulting engagements. To learn more, visit www.forest2market.com.

SOURCE: Forest2Market
 
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