Ocean Freight and the Coronavirus Impact
The severity of the coronavirus is impacting global trade in ways that many of us haven't experienced before.
As factories in China slowly return to full capacity, we are seeing several countries around the globe lock down their borders, but for the time being, trade will flow. Still, we are going to see severe disruption to supply chains over the coming months.
Ocean freight is still moving, but many of the shipping lines are announcing blank sailings, and the availability of containers is restricted.
The shipping lines continue to cut capacity as it deals with the significant global drop in demand. 2M and THE Alliance have both announced major capacity cuts on Asia to Europe trade lanes and industry sources are saying to expect further cuts in the coming days/weeks. All of WTA operators are fully briefed on any sailing cancellations and will re-book onto the next sailing, keeping everyone involved in the shipping process updated along the way. At the moment we do not see too much disruption though with current bookings, there might be a slight delay, but trade is still flowing from Asia to Europe and the USA.
Not only are shippers dealing with the impact of blank sailings, from May 1st, Maersk will only be providing spot pricing on the Far East to UK trade lane, rather than a monthly rate. This is likely to be problematical for a few reasons – primarily the rate may change per vessel and is also only valid the day you book, so the rate, in theory, could go up if you try to book the next day.
Also, they plan to implement penalties if bookings are amended or cancelled. WTA UK's feeling is that if this is successful, other carriers will adopt this as well. For up to the minute advice please contact Justin Hope
We are seeing rates hike in price from the Middle East to the UK and space on the vessels in limited.
With the Indian government announcing a complete lockdown. There is severe congestion at the major ports in India, mostly related to imports however exports have also ground to a halt with factories being closed.
Space remains very tight on all UK exports as a result of tonnage removal, and rates have spiked, and we expect this to stay for weeks to come.
There is currently still a shortage of reefer plugs available in Chinese ports due to there being such a backlog of reefers building up. Shipping lines have implemented a congestion surcharge for any imports of reefer containers.
Dangerous goods (DG) containers
There is a real shortage of space for DG containers so please contact your WTA representative as additional paperwork is required at this time.
Due to the high volume of blank sailings, we are seeing an imbalance of equipment, especially containers in Europe and USA; We expect to see that exports from the Europe/USA to Asia will have surcharges implemented by the carriers.
Supply chain disruptions are commonplace at the moment both at origin and destination. If you have a shipment on the water and expect it to arrive shortly into the UK but you are unable to take delivery due to COVID-19, then please get in touch, any containers left at the quay will likely incur high rent and demurrage charges from the shipping lines and ports.
WTA UK are able to offer you a solution. Contact Andrew Gooch directly or your WTA UK Contact is available to help and is more than happy to answer any questions you may have.
We can also assist with storage solutions at origin, if you don't want to ship your product at the moment, we have origin warehousing options all over China. If you would like to find out more please contact Alan li
Piraeus Delay in Transit programme
If you have a Delay in Transit (DIT) situation there is an alternative solution currently being offered by COSCO Shipping, where goods can be stored in Piraeus. Our operators are able to send a DIT request to COSCO and have your goods sent to Piraeus until you are ready to receive your goods. This will save your total cost and avoid higher storage charges in either port of loading or port of departure. For more information on this offering please contact your WTA representative or Andrew Gooch
Any major port congestion will reported on this webpage, but you can also find useful port information at https://sustainableworldports.org/world-ports-covid19-information-portal/
The British Ports Association have also published a Coronavirus information portal focusing on all of the major ports around the UK https://www.britishports.org.uk/coronavirus