Australia's east coast container ports brace for 'Bomb cyclone'

The Australian Bureau of Meteorology issued a warning for a low-pressure system on the East Coast, also known as the "bomb cyclone," prompting disruptions at Newcastle, Sydney, Wollongong and Batemans Bay. The adverse weather conditions, expected on July 2 and July 3, have led to halted ship movements, rerouted shipping schedules and operational adjustments at terminals to mitigate safety risks and minimize delays.

"A significant wave height of 5.4 meters was observed at the Sydney Waverider Buoy at 2 pm on July 1," the advisory said.

"Damaging surf conditions, which may lead to coastal erosion and localized damage to coastal infrastructure, are likely for coastlines between Seal Rocks and the Illawarra, extending south to Batemans Bay this evening and further south to the New South Wales/Victorian border during the late evening," according to the Bureau of Meteorology.

In response to the impending conditions, the market is on high alert.

"Operations at key terminals are already being adjusted, from pausing quay line work to prioritizing weather-safe maintenance, all in an effort to minimize disruption and ensure safety," said an Australian source.

"We stopped vessel movements around lunchtime today, but when I got in, all the cranes were up already, so basically I think it will be three days of closed port," said a source familiar with the matter.

The Port of NSW did not respond to requests for comment by the time of publication.

Meanwhile, carriers have begun rerouting ships to avoid Sydney and maintain schedules.

"Voyages have been readjusted to skip orders; they will now be reaching Fremantle first before proceeding to Sydney from Southeast Asia," a Southeast Asian freight forwarder said.

"Ships would have cut and run last night before the storm, but the Ever Unicorn on the NEAX just got in Monday night and is waiting it out in port," said the source who earlier commented on vessel movements.

Carrier Maersk announced a change in rotation due to the adverse weather.

"Due to adverse weather causing delays during the southbound voyage en route to Sydney, OC1 vessel MAERSK INVERNESS 522S/527N will perform a change of rotation between Sydney and Melbourne, with Melbourne now being called prior to Sydney to mitigate impact to the onward schedule," Maersk said in a notice.

Market participants are also reporting congestion issues in Sydney and expect recovery in four to five days. "Sydney is having a congestion of four to five days for now," said the same freight forwarder.

Platts, part of S&P Global Commodity Insights, assessed PCR 45 -- North Asia to East Coast Australia -- at $1,600/FEU, and PCR 47 -- North Asia to West Coast Australia -- at $1,700/FEU, on July 1.

Platts assessed PCR 49 -- Southeast Asia to East Coast Australia, and PCR 51 – Southeast Asia to West Coast Australia -- at $1,450/FEU on July 1.