Power Struggle
Europe scrambles to find new energy supplies ahead of winter with the ongoing Russo-Ukrainian war.
The continent is in talks to hire giant floating power plants which burn liquified natural gas, low-sulfur fuel oil, or biodiesel.
“We are in discussions with four of the leading economies of the European Union,” Zeynep Harezi, chief commercial operations officer of Istanbul-based Karpowership said in an interview. “If we can get over the bureaucracy, the documentation, then hopefully we will be generating electricity at a very low cost while within EU environmental regulations.”
The vessels could be set to dock at European ports in December.
From an environmental perspective, the potential deployment of these ships is highly problematic. On the other hand, the ships can produce enough electricity to power about 5 million homes for between 20 and 25 euro cents per kilowatt hour which is about half the current market rates for power in some counties.
Flying High
Air Freight rates are expected to stay higher than pre-pandemic levels despite a muted peak season.
Although over the last few months airfreight rates have been falling, rates are not expected to drop below pre-Covid levels given the uncertainty of the global economy.
“The one certainty is that freight markets in general – and especially highly dynamic airfreight markets – continue to see unprecedented levels of volatility and unpredictability,” said senior analyst at investment bank Stifel Bruce Chan.
“Forecasts and budgeting are more challenging than ever, and safety, insurance, and flexibility remain king.”
Crippling Congestion
California is calling for project proposals to improve supply chain infrastructure which will be funded in part by the $1.2 billion allocated by the state. Gov. Gavin Newsom vowed to address the crippling congestion in ports, particularly in Los Angeles and Long Beach.
“California’s ports are critical to exporting and importing goods both abroad and throughout the United States,” Newsom said in the statement. “After decades of neglect, we are finally making the critical investments needed to modernize our ports – helping us to keep up with demand in a way that is environmentally sustainable and brings our distribution process into the 21st century.”
Newsom’s executive order aims to reduce congestion and vessel backlogs at the LA/LB ports, the country’s busiest container gateway.
Paralyzed Port
The dockworkers’ strike in Cape Town and Durban that started October 6 has led shippers to skip calls to the ports or divert ships elsewhere.
The workers union rejected the three-year wage package totaling 15.1 percent — a 4.5 percent pay increase this year followed by 5.3 percent increases in both 2023 and 2024 offered by Transnet, Durban’s terminal operator. They are demanding a one-year deal with a 12 percent pay hike.
“All terminals and rail are effectively at an operational standstill,” Maersk said. “We have vessels alongside with containers still to be discharged that are heavily delayed and, with minimal gate and rail activity, we will not be able to deliver sold transit times and delivery dates.”