10 Most Read Panjiva Research Reports in September 2017 | — Panjiva
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10 Most Read Panjiva Research Reports in September 2017

  • By Christopher Rogers
  • · October 6, 2017
  • ·

Logistics resilience, and specifically the terrible results of Hurricanes Harvey, Irma and Maria, was the preoccupation for our readers in September. Hurricane Irma’s disruption of 10,600 TEUs of daily handling pales when compared to Maria’s devastation of Puerto Rico. The day-to-day business of logistics continued, with a focus on the strong performance of Expeditors and Schenker, and struggles for Maersk and Hapag-Lloyd on U.S.-inbound routes. Most U.S. ports saw growth, though there was a marked export slump, especially at Long Beach. In trade policy, President Trump’s actions were – unsurprisingly – at the fore with a delay to actions on steel and aluminum policy and threats to extend sanctions against Venezuela. NAFTA talks continued, but have yet to address the critical rules-of-origin topic, while UN sanctions against North Korea were extended. 

#1 Expeditors and Schenker boss the NVOCCs (Sept 12) The top 10 NVOCCs on U.S.-inbound routes once again did better than the industry more broadly, expanding their volumes by 5% vs. the average 3%. Expeditors (the largest) and DB Schenker did best, growing volumes 14% and 17% respectively, while Panalpina (down 4%) may have suffered for its outsize exposure to Texas and its hurricanes and DSV (down 13%) could struggle in September.

MORE EAST-WEST DEALS NEEDED TO ENSURE GLOBAL NVOCC EFFICIENCY  

CLICK CHART FOR HIGH RESOLUTION VERSION. Chart shows ranking among NVOCCs over the past three months by country of origin to the U.S. in number of shipments. Dark blue indicates higher rank  Source: Panjiva

#2 Hurricane Irma’s 10,600 TEU closures (Sept 11) The hurricane had a devastating effect on life and property, but its track to the west of Florida reduced its overall impact on the shipping industry. The big four Florida ports and Savannah all had extensive closures, with around 10,600 TEUs of capacity offline on a daily basis. Industries that rely heavily on Floridian ports include building materials, potentially hampering recovery efforts.

#3 Steel can kicked down the road (Sept 22) President Donald Trump has decided not to take action on the section 232 “national security” reviews of aluminum and steel until tax reform is passed. When he does want to move, there are three challenges. First, applying tariffs will raise costs, second is showing actual national security issues and third is determining who to target. In the meantime Russian and Chinese exports of steel to the U.S. grew 113% and 27% respectively in the past quarter on a year earlier.

#4 Coping with Puerto Rico’s devastation (Sept 26) The damage to the U.S. mainland from recent hurricanes pales when compared to Maria’s impact on Puerto Rico. While the Jones Act restrictions were lifted later in the month, an ongoing challenge will be that 22% of all containerized freight – including water, baked goods and healthcare products – come from neighboring Dominican Republic. The DR has also suffered significant damage, with questions around the 4,000 TEUs of medical supplies and pharmaceuticals supplies made annually.

WHAT ARE NEIGHBORS FOR?

CLICK CHART FOR LARGER VERSION. Chart segments imports to Puerto Rico ports by country of origin and product type (HS-4). Source: Panjiva

#5 Tough month for Maersk and Hapag-Lloyd (Sept 13) COSCO Shipping and Hyundai Merchant Marine led growth among the container-lines on U.S.-inbound routes in August, with a 31% growth vs. a year earlier each. Maersk meanwhile saw a 3% loss in volumes – probably due to resurgent Asian-route shippers – while Hapag-Lloyd appears to have lost out on European routes. The “post consolidation” big five shippers’ market share continued to expand, reaching 39% from 36% a year earlier and 31% before the current round of consolidation started.

#6 Trump ready for “further action” on Venezuela (Sept 19) President Trump’s first UN speech included the need to deal with security issues in North Korea (see more below) and Venezuela among others. He stated being ready for “further action” against Venezuela, although it isn’t clear where this might occur. Oil imports are already falling, but China may take surplus volumes. Importantly, Venezuela’s total food imports fell 85% in the quarter to May 31, and have likely fallen further since – further action could lead to further food issues for the population.

#7 $704 billion of Indian trade in five charts (Sept 21) Panjiva’s latest offering is Indian trade data. Total trade reached $704 billion in the past 12 months, but has seen a 10% annualized decline over the past five years despite a recent rebound. Boosting exports is vital, with apparel (15% of the total) leading the recent revival, with other major lines including autos/parts, pharmaceuticals and agriculture. Key trade partners are China, the EU, the U.S. and the UAE, while neighboring Bangladesh and Pakistan are well down the league table.

EXPORTS FOR ALL WALKS OF LIFE

Chart segments India’s top 500 export lines by HS-4 as a proportion of total imports. Source: Panjiva

#8 UN snips at North Korea (Sept 12) The UN’s latest sanctions against North Korea included limiting oil imports and apparel exports – the latter accounted for 28% of China’s imports from the DPRK last year. Given China exported fabric to the DPRK for those clothes, the net effect on trade earnings for North Korea will be around $350 million. That compares to a current $1.2 billion trade surplus.

#9 Cali’s export slump not just about Hanjin (Sept 13) Container handling across California’s big three ports climbed 6% in August, which came despite an 11% slump in exports (imports rose 7%). That was a similar pattern to that seen across the country. The 26% collapse in exports via Long Beach can be partly compared to a “last minute rush” a year ago ahead of Hanjin Shipping’s failure, though a 7% slide in Oakland suggests the economy is at least partly to blame.

#10 Hoping for no NAFTA knock-out (Sept 1) There were two rounds of NAFTA talks during the month. The first (being the second round of discussions that started in August) started under the cloud of threats from President Trump to “terminate” participation in the deal. The round showed a comprehensive, rather than transactional approach, while the U.S. stance remained focus on cutting the trade deficit. Mexico and Canada became more hawkish after the talks, and into the second set of talks (round three overall) in the month. Those wrapped up at least one chapter, but left much undone, and so far though the critical issues on rules-of-origin and agriculture have yet to be resolved

TOUGH CHOICES, INTERNATIONAL RAMIFICATIONS

CLICK CHART FOR LARGER VERSION. Chart shows Mexican imports auto-parts across 24 HS-4 categories, with top 25 countries for each manufacturer. Color based on degree of exposure as a proportion of the manufacturers top 25 supplier countries. Source: Panjiva

 

 

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