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The Valencia Containerised Freight Index stabilises its growth with an increase of 4.14% in December

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The Valencia Containerised Freight Index stabilises its growth with an increase of 4.14% in December. Image: Port Authority of Valencia
The Valencia Containerised Freight Index stabilises its growth with an increase of 4.14% in December. Image: Port Authority of Valencia
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The Valencia Containerised Freight Index, the indicator that measures the trend and evolution of container transport costs by sea from the Port of Valencia, closed the year with a 4.14% increase in December compared to the previous month. This rise continues the trend of the last five months of the year, where the monthly increases have been more moderate than in the January-July period. Thus, the VCFI has reached a value of 4,063.59 points at the close of 2021, accumulating an increase of 185.5% compared to December 2020, while since the beginning of the series in January 2018 the increase has been 306.36%.

The high demand for port traffic, the price of marine fuel and congestion in some US precincts have marked the end of 2021. The VCFI rises in all geographical areas, except for Atlantic Europe, among which the increase of 1.21% in the Western Mediterranean and 2.95% in the Far East stand out.

For yet another month, the demand for products and services continues with the same growing trend as in previous months, which is reflected in maritime transport, which has experienced an increase in its levels, mainly due to the growth of traffic in Chinese ports. In fact, this strong boost in demand, especially in US containerised import traffics, except for motor vehicles and their parts due to the semiconductor crisis, is having a direct impact on global maritime activity.

Against this backdrop, shipping lines are using all available vessels so that the commercially idle fleet continues to be kept to a minimum. Thus, in mid-December, data provided by Alphaliner counted 48 inactive containerships with 149,386 TEU representing 0.6% of the total active units, showing a slight decrease from November’s level of 164,540 TEU of idle fleet.

Another key aspect when it comes to understanding the evolution of freight rates due to their direct influence on the operating costs of shipping lines is the price of fuel. Thus, according to data provided by Ship&Bunker on the cost of bunkering (refuelling of ships at sea) in the 20 main ports of the world, the average price of IFO 380 (Intermediate Fuel Oil) stood at $480.50 in December compared to $455.50 the previous month, which represents an increase of 5.48%. Similarly, VLSFO (Very Low Sulphur Fuel Oil) has increased by 8.18%, since in November the value was at $585.50 per tonne, while in December it reached $633.50.

As for the analysis of the different areas that make up the VCFI, growth has been the general trend in all areas except for Atlantic Europe, whose freight rates have decreased by 10.78% compared to November. The largest increases in the Index occurred in Africa East Coast (10.70%), Latin America Pacific (8.23%), Baltic States (7.78%), USA & Canada (5.31%) and Central America & Caribbean (4.59%).

In addition to the above-mentioned factors, port congestion continues to play a role in this increase in the VCFI in most areas. In this respect, the figures offered by the Marine Exchange Southern California indicate that in mid-December, 101 container vessels were held up in the ports of Los Angeles-Long Beach.

VCFI Western Mediterranean

Regarding the Western Mediterranean sub-index in the month of December, the VCFI reflects an increase of 1.21% over the previous month, standing at 2,117.25 points and accumulating a growth of 111.73% since the beginning of the series in 2018. In this area, it is worth highlighting the continued increase in traffics from Valenciaport to Morocco, which are even above the levels reached in 2019 and 2020. Similarly, export figures from Valenciaport to Tunisia have increased in the last month, also exceeding the values of previous years. On the other hand, traffic from the Valencian precinct to Algeria has decreased during the last month, reaching a lower level than in previous years.

VCFI Far East

In the Far East area, there was an increase of 2.94% to 3,742.98 points. The VCFI with this area has risen by 274.30% since January 2018. In this rise, in addition to the factors common to the rest of the regions, Valenciaport’s traffic with the countries in this area should also be noted. In this regard, it is worth highlighting an increase in Valenciaport’s export flows with China, the main trading partner and the most important market in the Far East. In this last period of the year, the behaviour of the demand for goods has been decisive, which has a clearly seasonal component, marked by the Christmas festivities and the proximity of the Chinese New Year, a date of special importance due to its direct influence on the dynamism of international trade.

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Maritime

The Port of Valencia begins electrification of its docks

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The Port of Valencia begins electrification of its docks. Image: Port Authority of Valencia
The Port of Valencia begins electrification of its docks. Image: Port Authority of Valencia
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A new step in the decarbonisation of the Port of Valencia and its firm commitment to be an emission neutral site by 2030. The Port Authority of Valencia (APV) has put out to tender the drafting and execution of the works for the electrical connection to ships for the Transversal Costa-MSC quay. This is the first electrification or Onshore Power Supply (OPS) project to be carried out by Valenciaport in the Valencian precinct.

The APV is thus initiating the procedure for the award of the contract for the drafting and execution of the project for the installation of electrical connections for ships and the maintenance of the same at the Transversal de Costa quay. To this end, Valenciaport has jointly launched the drafting of the construction project, the execution of its works and the maintenance of the installations in the same procedure for an amount of 12,468,626.8 euros (VAT included).

Onshore Power Supply (OPS) electrification infrastructures have been consolidated as a very useful tool for the decarbonisation of ports, as this system avoids the use of auxiliary engines of ships when they are docked in the enclosures. This reduces greenhouse gas emissions – due to the use of electricity that eliminates the consumption of fossil fuels used in these auxiliary engines – and stops the emission of particles and polluting gases.

This OPS initiative in the Port of Valencia will be carried out in parallel with the works on the new electrical substation – a second substation is also planned – which was put out to tender last month with a base budget of around 11 million euros and a completion period of 24 months. This infrastructure will be responsible for supplying green energy to the first OPS electrification project of the Transversal de Costa-MSC quay.

In this regard, Joan Calabuig, president of Valenciaport, stressed that “these are just two examples of real projects in the execution phase that confirm the firm commitment that Valenciaport is making to achieve the goal of being a zero-emissions port by 2030, twenty years ahead of the European Green Pact. It is a commitment to sustainability and to the society of our environment that is supported by initiatives such as the electrification of the docks, the use of hydrogen in port operations, the installation of photovoltaic plants or the commitment to intermodality with the railway. We are committed to sustainable growth that reinforces our position as a port of reference in the Mediterranean”.

Project included in the Next Generation Funds

The joint contracting of the preparation of the project and the execution of the corresponding works in the same procedure is carried out in response to the fact that there are no references in Europe compatible with the ISO/IEC/IEEE 80005 standard and in Spain there is currently no previous experience of OPS projects in operation with the characteristics of the pilot project defined by the Port Authority of Valencia. The combination of the individual components required for this type of installation (transformers, protection cells, disconnectors, frequency converters, etc.) with infrastructures for supplying electricity to ships requires specific projects, with technically complex solutions that have to be designed specifically for each location. In addition, and given that the execution of the construction project is subsidised by the European Union’s Next Generation funds and the Spanish Government’s Recovery, Transformation and Resilience Plan, the joint tender is the only way to meet the established deadlines, since if two separate contracts were launched, the one for the execution of the construction project could not be launched until the one for the drafting of the construction project had been awarded, which would mean that the work would be completed beyond the deadline for the execution of the works to meet the target set by Europe.

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Environment

MOL joins GCMD as impact partner to accelerate decarbonisation

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MOL joins GCMD as impact partner to accelerate decarbonisation. Image: Pixabay
MOL joins GCMD as impact partner to accelerate decarbonisation. Image: Pixabay
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The Global Centre for Maritime Decarbonisation GCMD and MOL announced the signing of a five-year Impact Partnership agreement. On the same day, both parties held a signing ceremony at the GCMD office in Singapore.

Decarbonisation in the maritime industry is a challenge that needs to be achieved through accelerating collaboration and increasing investment by shipping companies, their customers, ports, energy suppliers and public sector actors. As an Impact Partner of GCMD, MOL will utilise its expertise developed over their long history and make various contributions and collaborations through its participation in GCMD’s projects, including providing access to vessels, operating data and evaluation reports so that internal learnings can be shared publicly and used for future trials.

MOL is one of the world’s leaders in the maritime industry and has been leading worldwide discussions on achieving decarbonisation. The carbon budget concept imposes a ceiling to the cumulative amount of greenhouse gas (GHG) that can be emitted globally in order to limit global temperature rise to 1.5 degree Celsius by 2050. Intermediate targets to reduce emissions, in addition to a net-zero target, are necessary. While plans are in place to adopt low or zero emissions vessels in the future, it is important to deploy measures to reduce emissions now. Such measures include the use of low-carbon and transition fuels that are available today, and deploying energy savings devices onboard vessels. MOL will bring its extensive capabilities and experience to bear as it joins GCMD and existing partners to accelerate international shipping’s decarbonisation.

Professor Lynn Loo, CEO of the Global Centre for Maritime Decarbonisation, said: “We are proud to have MOL, one of the leading shipowners in Japan, come onboard as an Impact Partner. We are excited to tap on MOL’s track record in developing technical energy efficiency measures to broaden our perspective as we scope an initiative to help increase industry adoption of measures that can increase fuel efficiency of ships.”

Toshiaki Tanaka, Representative Director, Executive Vice President Executive Officer, and Chief Operating Officer of MOL, said: “We are very pleased to be a partner of one of the most important global coalitions. We will make our biggest effort to contribute and accelerate progress towards the net zero future in maritime industry, together with GCMD and all its partners.”

About the Global Centre for Maritime Decarbonisation

The Global Centre for Maritime Decarbonisation (GCMD) was set up on 1 August 2021 as a non-profit organisation. Our strategic partners include the Maritime and Port Authority of Singapore (MPA), BHP, BW Group, Eastern Pacific Shipping, Foundation Det Norske Veritas, Ocean Network Express, Seatrium, bp, Hapag-Lloyd and NYK. Beyond the strategic partners, GCMD has brought on board 15 partners that engage at the centre level, in addition to more than 80 partners that engage at the project level.

Strategically located in Singapore, the world’s largest bunkering hub and second largest container port, GCMD aims to help the industry eliminate GHG emissions by shaping standards for future fuels, piloting low-carbon solutions in an end-to-end manner under real-world operations conditions, financing first-of-a-kind projects, and fostering collaboration across sectors.

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Container Shipping Lines

Wan Hai Lines establishes its new office in India

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Wan Hai Lines establishes its new office in India. Image: Unsplash
Wan Hai Lines establishes its new office in India. Image: Unsplash
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Aiming to further enhance service quality and gain a stronger foothold in the Indian sub-continent, Wan Hai Lines has established its India new office in Kolkata in July 2023. Contact details for the new office are as follows: WAN HAI LINES (INDIA) PVT. LTD 3rd Floor, Block C, Apeejay House, 15 Park Street, Kolkata, West Bengal, 700016 TEL: 91-33-4450 4500 According to the 2023 Foreign Trade Policy announced by the Indian Ministry of Commerce and Industry, India’s export trade volume will reach 2 trillion US dollars in 2030.

Therefore, benefiting from government policy incentives and the shifting trend of the global supply chain, India’s status in global manufacturing and international trade is increasing, which is conducive to maintaining long-term high economic growth. And the proportion of global exports has increased significantly. In addition, the continuous economic stimulus policy will help revitalize the domestic economy, and domestic demand is expected to increase significantly. Therefore, Wan Hai is optimistic about India’s future import and export situation. And also through the establishment of a new office to improve the overall operating efficiency.

Wan Hai India Kolkata office held a grand opening reception in the evening of 27th July. During the banquet, there were many important customers & guests. The Kolkata Port Authority, Kolkata terminal operators, feeder operators and important local customers were invited to send representatives to attend the meeting to express their blessings to Wan Hai’s opening of the Kolkata market. At present, Wan Hai has six owned offices in India, namely Mumbai, Chennai, Mundra, and Vizag, Delhi and the sixth office Kolkata office. In addition to directly providing river port services, it will also simultaneously strengthen service links between India and neighboring countries, such as Nepal and Bhutan. It is expected to pursue customer first through continuous expansion in the future and sustainable business philosophy.

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