Ports of Genoa: Covid-19 Update – Issue 25/2020 – The sun is rising in the East, when will the rays reach the West?

Ports of Genoa: Covid-19 Update - Issue 25/2020 The sun is rising in the East. When will the rays reach the West? While the Chinese economy rebounded to record peaks after the profound drop in the first quarter, hopes for other economies are projected on the third quarter, despite the continued spread of COVID does not allow to ease the concern. Global container traffic is still weak and shipping companies continue to use blank departures to cut costs. In the first half of the year, the movement of goods in the Ports of Genoa saw a sharp drop, with negative peaks in May and June, while passenger traffic is most affected by the pandemic, as cruise ships continue to remain inactive, while the ferries have just resumed their service across the Mediterranean. Global Economic TrendsChina’s EconomyChina’s economy grew strongly in the second quarter, in fact after having fallen at the fastest pace on record in Q1, real GDP increased by 11.5% from the first quarter, which translates to an annualized rate of 54.6%. It was up 3.2% from a year earlier. China, the first economy hit by the virus, is the only major economy to experience such a strong recovery in the second quarter. Most of the other large economies are projected to see significant growth in Q3 having declined sharply in the second quarter. The economy’s strength derives from a strong increase of the industrial sector, largely driven by government investment in infrastructure as well as a strengthening of exports. Yet consumer spending appeared to remain weak, with retail sales declining. Evidently, many consumers remain wary of social interaction given that the virus has not gone away. Moreover, many investors are likely concerned about a variety of risks, including the increasingly fraught relationship between the United States and China, the risk of more US sanctions and trade restrictions, and increasing tension between China and the European Union. China’s tradesIn the first semester of the year, Southeast Asia became China’s largest trading partner, overtaking the European Union: Chinese trade with the EU fell by 5% in the first half of 2020 versus a year earlier, and Chinese trade with the United States fell 10%. Meanwhile, Chinese trade with Southeast Asia increased considerably, apparently because China’s manufacturers are shifting some production to Southeast Asia, in order to both reduce costs and avoid US tariffs. Thus, there is more movement of components between China and Southeast Asia. In addition, increased trade with Southeast Asia gives Chinese producers access to technologies that, increasingly, the United States is making difficult to obtain. Singapore, for example, is a prime supplier of high value-added components, such as semiconductors, while Vietnam is helpful in providing low-wage production. The increased trade between China and Southeast Asia has also entailed direct foreign investment in Southeast Asia by Chinese companies, although such investment has lately decelerated during the COVID-19 crisis. Finally, in order to facilitate greater trade and cross-border investment, China and the Association of Southeast Asian Nations (ASEAN) signed a trade deal late last year that reduced trade barriers and intensified an existing free trade agreement. To enhance the relationship, China is also using its Belt and Road Initiative. Shipping & LogisticsContainer ShippingAccording to IAPH Barometer, blank sailings continue to affect container trade, mainly on trade routes with the Far East, even if their impact is lowering, in fact, worldwide, 53% of the ports are reporting that the number of calls by other cargo vessels is rather stable compared to a pre-COVID-19 situation.Container trafficPort container throughput in the first semester of the year experienced a heavy setback, falling off by -10.5% compared to the same period of 2019, registering a total of 1,213,189 TEU. After the positive performance of the first two months of the year, a contraction of 5.3% was recorded in March, which declined further in April (-15.8%) and in May (-26%), generating a drop of 26.5% in June (65,203 TEU less than in June 2019). Hinterland traffic suffered the most in the first half of the year. It was influenced by an extremely negative trend in Q2, with a decrease of 10.5% ( 1,061,217 TEU).Transhipment also underwent the dynamics of international trade, settling at 151,680 TEU (-10.4%, compared H1 2019).Containers moved by train experienced a considerable setback in the second quarter, both in terms of units transported and number of trains, which decreased respectively by 25.8% and 17.6%. General Cargo Conventional cargo volumes totalled 6 million tons, a sharp decline compared to the same period of the previous year. June rolling stock traffic showed a drop in all the Ports of Genoa cluster, but with different performances: the Sampierdarena basin recorded an 8.3% fall in tonnage, while the Ports of Savona/Vado Ligure shrank by 28.5%. Metal products registered a marked decrease, with -48.7% in the Port of Genoa and -61.4% in Savona, while forest products show different trends between the two ports with Genoa up 77.9% and Savona down 34.4%. The fruit handled in the Port of Savona ended the semester substantially stable with a drop of 2.7% compared to the same period of 2019. Bulk cargo Mineral oils fell by 18.2%, with a total of 8.4 million tons recorded in the first six months of the year (5.36 million in the Port of Genoa and 3.08 million in the Port of Savona-Vado Ligure). June closed with a drop of 370,000 tons, compared to the same month in 2019 (-20.5%). Dry bulk trade posted unprecedented decline, with a contraction of 47.7% due mainly to the lower commodity demand as a direct result of the economic slowdown. Passengers Passenger traffic continues to be greatly affected by COVID-19. In fact, the cruise passenger market remained at zero levels in June because of the last 4 months suspension. The semester registered an 80.6% decrease, with 693,841 passengers less than in the first six months of 2019. Ferry passenger traffic, limited to a few services, in June dropped by 70.4%, with 94,709 passengers (+85,371 compared to May 2020), signal of a slow recovery in the sector. However, passenger traffic decreased by 73.9% in the semester, with 1,147,902 passengers less than last year. Source: Autorita’ di Sistema Portuale del Mar Ligure Occidentale (AdSP - Western Ligurian Sea Port Authority)

Ports of Genoa: Covid-19 Update – Issue 25/2020 – The sun is rising in the East, when will the rays reach the West?

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Ports of Genoa: Covid-19 Update – Issue 25/2020 – The sun is rising in the East, when will the rays reach the West?

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All news

New Caspian ferry line Turkmenbashi-Olya might finally launch

Kazakhstan’s ports handled 6.2 mln tonnes of cargo in Jan-Oct’24

DFDS finally buys Ekol Logistics

Two cocaine shipments, 720 kg and 720 kg, seized in Vlissingen port

Malta sees reduced cruise ship passengers in Q3 2024

Our Expert Analysis

Latest Free Reads

Top Ports