Crew change crisis worsens marine market

Sea freight climbed up further recently when the container marine market continued saw sound demand:

European route

The confirmed COVID-19 cases gradually stabilized in Europe. Many nations carried out eased pandemic prevention measures. That meant better demand for transportation. Original shipping capacity seemed to be inadequate.

North America route

The pandemic continued spreading in US. Market players showed high demand for imported materials. The congestion of ports, unsmooth marine transportation and the stagnation of containers caused by the COVID-19 pandemic remained. The deployment of marine merchants is hard to ease the deadlock on marine market temporarily.

Mediterranean route

Delivery volume was largely stable after Ramadan. Balanced supply and demand was seen on the market. The average utilization rate of seats at Shanghai port was largely near 95%.

South America route

The pandemic deteriorated in South America recently. Players’ demand for imported goods improved but local capacity was limited. That meant high demand for transportation. 

Singapore, as a shipping hub, was forced to forbid seafarers from India and other Southeast Asian nations entering the country with intensified pandemic in India. The change of crew came to a crisis, exacerbating tight shipping capacity worldwide.

Recently, on seafarer company headquartered in Singapore expressed that it was common to see the spread of pandemic in the ships now. That meant these ships were not able to navigate.  

Wu Peiyuan, Associate Professor of NUS Business School, expressed that it will affect the schedule of freighters and supply chain and further lead to increasing price of consumer goods after the whole marine industry became disordered. As a result, inflation may sustain. 

Statistics from the UN showed that 80% of trade relies on marine in the world. Among the 1.6 million seafarers worldwide, 0.24 million came from India. The restriction of entry tends to worsen marine industry. Such situation is hard to alleviate in short run. Some insiders noted that, compared with the supply chain crunch due to the difficulty in crew change, the earlier congestion of Suez Canal in Mar will even become unworthy of being mentioned.

Confronting such fierce status, marine agencies and maritime experts called that vaccinating the transferred crew as soon as possible is the most feasible way to deal with current crisis. 

Abdulgani Serang, Secretary General of NUSI, expressed that seafarers have been hailed as key workers, who have the priority to be inoculated, while it did not happen in India. The short of vaccine was the crucial problem. 

The 0.24 million Indian seafarers were mainly aged between 18 and 45, but the shortage of vaccine forced many state government in India delaying the vaccination. Serang expressed that Indian seafarers without vaccination were under disadvantageous position compared with seafarers from other nations. Not all Indian sailors were forbidden temporarily, but shipping owners still worried about current status.  

At present, ports such as those in Singapore and Fuchaira in the United Arab Emirates have banned ships from replacing crews recently from India, making it difficult for seafarers to disembark when their contracts expire. It was reported that China's Zhoushan Port has banned any ships and crews who have visited India and Bangladesh from entering the country. In the past three months, the pandemic in India and Bangladesh was increasingly serious. 

It is not easy to transfer seafarers from India. As more and more ports and airports forbid Indian seafarers entering and leaving, shipping companies said this will lead to bottlenecks in crew change, and some companies were temporarily transferring seafarers from other countries to replace Indians who were scheduled to board. Carl Schou, chief executive of Wilhelmsen, a Norwegian company, said 15% of the company's about 10, 000 employees are from India, mainly managers. The company stopped transferring its crew in India from April 24, at least until the end of May, and is looking for people of other nationalities to fill the vacancy. But it's not as easy as it sounds. For ships like the LNG and tankers that have very specific requirements for ability and experience, many talented people are from India. Finding a suitable seafarer that meets the criteria is a big problem.