Logistics News Briefing
May 2020
Covid-19 Crisis in Focus
Digital Logistics
Perishables & Pharma
Regulation & Procedures
Express & eCommerce
Maritime & Waterways
Green Logistics

The Covid-19 emergency has highlighted the importance of logistics to governments and indeed the general public. The sector is playing a vital role during lockdown by ensuring supplies of essential goods and services, including food products and other perishables, pharmaceuticals, vaccines and medical supplies. Nevertheless, freight levels are down sharply over the past two months, impacting the financial health of industry members. While the lifting of restrictions has begun, people are still encouraged to stay at home, and future consumer goods demand remains unclear. This month’s briefing highlights developments relating to Covid-19 and its impact on logistics service providers.

Covid-19 Crisis in Focus

Rail and road freight hit by pandemic with global traffic in decline

Combined rail and road freight transport in Germany has declined by 20% since mid-March due to the Covid-19 pandemic, according to the federal Transport Ministry. German motorway freight transport on April 3 was down 16% from pre-crisis levels, according to official data. At a global level, Clive Data Services calculates that airfreight volumes decreased 23% year on year in March, while Railwatch has reported an 18.9% volume reduction at major maritime cargo hubs, with rail freight experiencing a decline of 19.6% from a year earlier. The International Monetary Fund now expects worldwide GDP to shrink by 3% in 2020, compared with a previous forecast of 3.3% growth.

Best source: DVZ (subscription required, in German)
Germany set for unified Sunday traffic regulations

DVF, the German Transport Forum, wants trucks to be allowed to drive across Germany under harmonised national rules on Sundays during the Covid-19 pandemic to avoid what it says is a regulatory nightmare. The request is supported by transport minister Andreas Scheuer, who has asked the German federal states to comply.

Best source: DVZ (in German, subscription required)
German government permits flexible working for logistics sectors

The German government has agreed that logistics workers in certain food and healthcare sectors can work 12 hours a day until the end of June to help the economy cope with the impact of the Covid-19 pandemic. Trade union VERDI is supporting the move, but with a limit of 60 hours per week. Sunday and public holiday working is also included in the provisions, with all overtime payments to be made prior to July 31.

Best source: DVZ (in German, subscription required)
German e-commerce slumps in March

Activity in the German e-commerce sector during March was down 20% from the same month of 2019, despite the Covid-19 pandemic lifting online sales in other countries. The results offset all growth from the first two months of 2020, with Germany's clothing sector taking the biggest hit to date.

Best source: DVZ (subscription required, in German)
See also: DVZ Digimagazin (subscription required, in German)
Luxembourg media ramp up logistics coverage during Covid-19 crisis

Luxembourg's media have highlighted the role played by logistics companies in keeping the economy going during the Covid-19 pandemic. Industry participants talked to national media such as RTL Lëtzebuerg, Lëtzebuerger Journal and Luxemburger Wort to discuss the part played by the logistics sector during the crisis.

Best source: Cluster for Logistics
See also: Luxemburger Wort (in German)
See also: Luxemburger Wort (in German)
See also: Lëtzebuerger Journal (in German)
Digital Logistics
Antwerp tests wearables for social distancing

The Port of Antwerp is testing digital bracelets to help with social distancing measures and to enable contact tracing to prevent the spread of Covid-19. The bracelets, made by Belgian firm Romware, emit warning signals if workers come within 1.5 metres of each other, and can be used to identify colleagues that an infected person has been in contact with.

Best source: Freightwaves
Maersk reports 90% rise in app use

Maersk has reported record use of its mobile app since the outbreak of the Covid-19 pandemic. The shipping line says demand for online business transactions has risen by nearly 90% this year, as clients with employees working from home have had to rely on e-commerce solutions.

Best source: Port Technology
Perishables & Pharma

Covid-19 lockdowns create European food surpluses

Europeans are being urged to eat more fresh produce as the closure of restaurants and hotels due to the Covid-19 outbreak has led to a surplus of produce in storage. Belgian potato trade association Belgapom is encouraging consumers to eat an extra portion of chips every week to reduce a 750,000-tonne surplus, while European producers are dumping unsold milk, vegetables and herbs.

Best source: Financial Times (subscription required)
PostNL takes stake in healthcare logistics provider

PostNL is acquiring a minority stake in the healthcare business of Dutch logistics provider CB. The move will see the two companies working together more closely to serve healthcare sector clients, with deliveries to patients both at home and in care institutions.

Best source: IPC
Apeiron picks up €200m German portfolio

Apeiron Capital has partnered with Midas International Asset Management to acquire a €200m German logistics portfolio. The assets, which boast 150,000 square metres in rental space, were sold by logistics real estate firm Verdion and Canadian fund Healthcare of Ontario Pension Plan.

Best source: Property Week (subscription required)
KKR acquires pan-European developer Mirastar

KKR has acquired M7 Real Estate’s stake in pan-European logistics developer Mirastar for an undisclosed amount. A big-box specialist, Mirastar will become KKR’s primary platform for industrial and logistics real estate transactions in Europe.

Best source: Finsmes
WDP plans to double size of Romanian portfolio

WDP says it is looking to increase its Romanian portfolio from the current €500m to €1bn by 2023. The company has signed a €205m deal with the International Finance Corporation to fund new logistics projects in the market.

Best source: See News
Hansainvest acquires €18.5m German logistics asset

Hansainvest Real Assets has acquired an €18.5m property covering 22,450 square metres in northern Bavaria for its new Hansa Europe Logistic Fund. The asset, purchased from a joint venture between Verdion and List Group, is currently under construction and has been pre-let to Dachser.

Best source: Investment & Pensions Europe Real Assets
Regulation & Procedures

Luxembourg temporarily eases VAT and Intrastat requirements

The Luxembourg authorities have temporarily eased requirements on VAT and Intrastat declarations due to the Covid-19 pandemic. Deadlines for the payment of VAT will be extended upon request and penalties for late filing of VAT declarations will be suspended. Statistics agency Statec has also extended the deadline for filing Intrastat declarations for the months of February to May.

Best source: Single Window for Logistics
OECD advises against support for indebted container lines

The OECD’s International Transport Forum has warned against bailouts for container lines that externalise risks to the public and engage in a race to the bottom on regulation, subsidies and tax exemptions. The transport body says the high debt levels of such companies leaves them ill-prepared for the type of economic shock delivered by Covid-19. It believes bankruptcy risks will be transferred to the public sector, while the risks for climate change, health and pollution, and financing in public infrastructure are also significant.

Best source: Container Management
European road freight rates hold up in first quarter

The average European road freight rate during the first quarter was €1,099, down 0.8% from the final three months of 2019 and by 0.2% year on year, according to the road freight rate benchmark from Transport Intelligence and Upply. Ti says a significant decline in volumes in some sectors due to the Covid-19 pandemic was alleviated by hauliers reducing capacity, which held up rates.

Best source: The Loadstar
Express & eCommerce
Cargolux sees profit tumble in 2019

Cargolux has posted a net profit of $20m for 2019, down 90.5% from $211m the previous year, while revenues fell 14% from $2.63bn to $2.26bn. The company says it was impacted by reduced load factors and yields, along with lower fuel surcharge revenues due to declining fuel prices.

Best source: Global Cargo News
Logwin issues profit warning

Logwin Group has warned that it expects profit to decline significantly this year due to the global impact of the Covid-19 pandemic. The company has reported preliminary ebita of €9.4m for the first quarter, down from €12.1m for the same period last year.

Best source: Verkehrsrundschau (in German)
Leipzig/Halle reports steady cargo volumes for first quarter

Leipzig/Halle Airport reports that traffic held up in its cargo business during the first quarter, with 297,315 tonnes handled representing just a 1.5% year-on-year fall. The Covid-19 outbreak has created demand for express freight, medical protective equipment and temperature-sensitive pharmaceutical products, with no immediate sign of this diminishing, the airport says.

Best source: Air Cargo News
Shandong-Europe Express delivers first cargo in Hamburg

The Shandong-Europe Express train completed its maiden trip from China on April 30, arriving at Hamburg’s Billwerder Terminal from Jinan with a cargo of wind turbine parts, LEDs, tools and medical supplies. The next departures from Jinan are scheduled for May 16 and 30, although carriage is not yet available from Europe to China.

Best source: Port Technology
Maritime & Waterways

Covid-19 pandemic to lead to contraction of container fleet: Drewry

The Covid-19 pandemic will lead to a contraction of the global shipping container fleet and will depress prices and lease rates this year, according to Drewry. Its analysts expect the ocean-borne fleet of containers to decrease marginally, representing the first decline since 2009.

Best source: SeaTrade Maritime News
Hapag-Lloyd temporarily shelves mega-ship plans

Hapag-Lloyd has delayed plans to construct a new fleet of mega-ships capable of handling 23,000 TEUs, putting the decision down to the Covid-19 pandemic. The company says it still requires the vessels and that it will reassess the situation once the economic slump has passed.

Best source: Port Technology
Rotterdam sees possible 20% volume decline for 2020

The Port of Rotterdam is expecting a decline of between 10% and 20% in volumes this year due to disruption caused by the Covid-19 pandemic. Ro-ro traffic will be significantly lower due to lockdowns, while iron ore and coal flows to the German steel sector are expected to decrease because of falling demand from the automobile and construction industries.

Best source: Container Management
Green Logistics
Rotterdam accelerates hydrogen push

The Port of Rotterdam is bringing forward plans to build a hydrogen network as part of a joint venture with Shell and Dutch energy infrastructure operator Gasunie. A manufacturing plant to provide so-called green hydrogen at the port is slated for completion in 2023, as part of a series of projects linked to the production, import, use and transfer of the gas.

Best source: Port Technology
Hapag-Lloyd reports halving of carbon emissions

Hapag-Lloyd has posted a 50% decline in carbon emissions per TEU/kilometre for 2019. The company says it will continue to seek further reductions in fleet emissions this year, despite the adverse effects of the Covid-19 pandemic.

Best source: SeaTrade Maritime News

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