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Global Shipping Update

Please find our latest global industry update below:

USA

The US trucking industry has been extremely stretched due the impact of COVID-19 on manpower and lack of equipment. The situation has become increasingly more challenging and truck deliveries are becoming problematic in a number of reception areas in North America. 

In addition to the aforementioned driver and equipment shortages, a huge growth in volumes globally as well as terminal congestion at ports are impacting carrier haulage operations and timely deliveries. US ports have struggled with the huge increase in volumes, as have ports across the globe, with the US west coast ports reporting a 20% surge in imports with containers causing significant congestion at ports resulting in truck turn times taking between 15-20% longer on average.

The Port of Long Beach, Los Angeles, New York and New Jersey are now experiencing ‘extreme conditions’ (according to the US Federal Maritime Commission (FMC)), with impact felt across the USA, and haulage issues peaking in New York, LA, as well as Atlanta and Chicago.

Additional delays and an increase in cost are to be expected.

We will continue to do all we can to mitigate the charges and find time- and cost-effective solutions for you.

Ocean freight volume is back to pre-COVID 19 levels, if not slightly higher, and capacity very tight, especially for Asia - US freight. As a result, rates are expected to increase further with cargo rolls and tight chassis supply expected to persist through the fourth quarter.

US exports to Australia are still experiencing disruption due to the recent strikes at Patrick Ports, with some carriers not taking any new sea freight bookings to Australia at all until things settle down. Australia’s backlog is being cleared, but we have several containers stuck in Asian transhipment ports constantly being rolled from vessel to vessel while carriers struggle to fit more freight on overfilled feeder vessels. We are doing our best to manage expectations with clients who have freight in these containers and to adapt to twice-daily carrier updates and changes appropriately.

Delays are continuing at terminals in the US, particularly Long Beach / Los Angeles and New York City. The time containers spend within the port complex has increased to the highest level in 18 months. Inefficiencies at the terminals remain as a result of Covid-19 operational policy changes.
As a result of these congestion issues, 
carriers have announced emergency surchargesThese vary depending on the shipping line/co-loader.

UK

Please be advised that the port of Dover will be closed to traffic leaving the UK for the next 48 hours from midnight on Sunday, 20th December (23:00hrs GMT), impacting freight movements in and out of the UK. France halted movements following concerns over the spread of a new strain of coronavirus, which has also seen London and surrounding counties enter Tier 4 restrictions as of Saturday, 19th December 2020.

While freight from France to the UK will be allowed, there are fears lorry drivers will not travel to avoid being stuck in the UK. Companies are advised to delay or even abort sending trucks to Dover and, and sailings into Caen will also be affected.

As per previous advisories and the widely communicated issues at the port of Felixstowe with vessels taking much longer than usual to discharge/load, a number of Ocean Alliance carriers as well as 2M and THE Alliance partners have announced that they would no longer call at Felixstowe but discharge their UK imports at alternative European ports instead. In addition, carriers are discussing omitting Felixstowe for the month of January entirely, while export bookings from the UK have been suspended by several carriers and are increasingly only available on payment of premium fees from alternative European ports. This has had a knock-on effect on land-side operations, some temporary allocation and service changes as well as total vessel cancellations with all ocean services into the UK being impacted unfortunately.

Port Congestion Surcharges (PCS) have been implemented by some carriers covering both Felixstowe and Southampton arrivals and rates have increased significantly.

This is a quickly changing situation and our operations and customer service teams are doing their best to deal with this and its related disruption quickly. We expect to see severe impact to supply chains immediately.

While our operations and customer service teams are doing their best to deal with this quickly changing situation and its related disruption, communication may be slightly delayed. We are trying to resolve any queries and are working to find the best possible solutions to move your containers as quickly as possible. We thank you for your understanding and patience.

Brexit is already impacting the market with many companies ‘stock piling’ goods in the UK in preparation for delays at the border in early January 2021. Demand is expected to continue to increase prior to Brexit (with the transition period ending on 31st December 2020). Businesses are being urged to get ‘Brexit ready’ and consider their terms of sale and supply chain structures for January 2021. Woodland recommend you check carefully as to your responsibilities with customs under the Incoterms you use with your sale and/or purchase of goods to/from the EU from January.

Woodland is already at advance stages of preparations for handling trade to and from the EU from January 2021 and can act as your customs intermediary should you require one.

Find all Brexit-related information here.

Due to the recent increase in COVID-19 cases reported in the UK, and alongside related closures of ports, some countries have banned flights from the UK. Flying programmes are being reviewed to continue to operate on a cargo-only basis where possible. 

The Hong Kong authorities have advised that from today, 22nd December, entry to passengers travelling from the United Kingdom will be denied until further notice. In addition, new restrictions require aircrew to isolate for 21 days.  As a result, some carriers have taken the decision to temporarily suspend their services between London Heathrow and Hong Kong.

British Airways workers employed in its cargo division will strike from Christmas Day until 2nd January 2021, in the dispute over the decision to fire and rehire the workforce on inferior pay and conditions.

Our airfreight operations team are in daily contact with airlines and handling agents, and will keep you updated at the time of any service issues experienced.

Air freight capacity from the UK to the USA is becoming tighter, especially to Chicago and Atlanta, which can result in higher pricing - please book as far in advance as possible.

It is estimated that when a Covid-19 vaccine becomes available, general airfreight shippers are likely to face further capacity shortages and price hikes.

Freighter aircraft are expected to be in short supply for the next three years putting a further strain on International airfreight capacity and rates. Boeing estimates it will take three years for travel to return to 2019 levels, with the International long-haul market being the last to return to strength.
Since the beginning of the pandemic, more than 30 carriers have failed or entered bankruptcy restructuring.

EUROPE
With January 2021 fast approaching, we have seen severe increases on inbound trade volumes from the EU to the UK with companies bringing in goods in preparation for the New Year and potential delays at the borders. This is creating an early ‘peak season’ forcing up trailer prices in the market due to the imbalance of trade.
 
As a result, equipment is currently in short supply due to the high demand and notice periods on bookings with carriers are extending out to near a week in some markets. Please make sure you book early for any requirements you have to avoid delays.
Congestion at the ports of Rotterdam and Antwerp is leading to delays, with waiting time to handle freight between 26 hours (Antwerp) and 100 hours (Rotterdam).
 
The capacity bottlenecks at the terminals arise as a result of load peaks due to the big call sizes of seagoing ships combined with the additional measures taken as a result of COVID-19.
ASIA

China has imposed a lockdown in its northern city of Shijiazhuang after the Hebei province on Wednesday reported 63 new COVID-19 cases. Shijiazhuang, with a population of 11 million was placed under lockdown measures, with passenger train services suspended to prevent further spread of the virus, according to state news agency Xinhua. Flights and coaches services to Beijing, 300 KM ( 186 miles ) north of Shijiazhuang, were cancelled and the roads between Hebei to Tianjin closed temporarily. For the time being, Tianjin port is still under operating normally. Tianjin and Beijing export / import and local transportation are affected due to the road closures around Hebei.

The port city Dalian in China has seen no new COVID-19 cases following a spike of cases a few weeks ago with some districts in Dalian having closed as a result. Dalian port is slowly recovering and operating again, however

  • A number of vessels are getting delayed by 7-10 days, some even up to two weeks
  • The Dalian government requests the Dalian port operator to do every import container disinfection, which is causing further delays
  • As a result, some vessels have stopped calling at Dalian port until the situation returns to normal.  The challenges are expected to continue until CNY at least
  • Additionally, the PLAN ( People’s Liberation Army Navy ) is now doing military exercises in the north sea areas, making it more difficult for carriers to call Dalian for the time being.
Equipment shortages are now dire particularly for 40GP and 40HQ. Some carriers have stopped accepting bookings due to not being able to provide the equipment altogether. The ongoing shortage of equipment is expected to last for many weeks to come.
A shortage of containers rather than space on box ships is the main driver of the unrelenting spike in freight rates on headhaul routes.The focus by carriers to reposition their empty equipment as quickly as possible back to Asia, to take advantage of skyrocketing spot rates, has left exporters around the world scrambling for containers. (Source: Loadstar)

We have been notified of considerable increases by way of GRI’s and other related surcharges which have driven rates to new heights. The UK is particularly affected, which is mainly due to serious port congestion at the Port of Felixstowe with impact felt across all other UK ports.

Carriers have publicised that they are currently reluctant to take on UK-bound cargo as it is causing them increasing operational difficulties. This, in combination with a further wave of blank sailings being introduced and a growing lack of equipment in China and SE Asia, is impacting rates. These industry-wide challenges are set to continue into December and Q1 of 2021, with further increases expected in the run up to the Chinese New Year in February. 

The above-mentioned challenges are impacting both air and rail solutions, resulting in an increase in rates due to lack of capacity and congestion. 

Air freight 

Capacity from China has been an issue since the recent Golden Week holiday and is continuing, which is resulting in an increase to rates. 

Rail Services from China
A lack of equipment is resulting in space issues. In addition, serious congestion is being reported at Chinese and European border crossings.

In light of the above, rail services are being restructured with reduced services being operated from various China rail lines and some services currently not running at all.

Our teams are working hard to find alternatives and to assist with moving your supply chain - the capacity shortage is significant and it is important to try and secure bookings wherever possible.

Please be reminded of the importance of booking well in advance and, where possible, please be open to considering alternative sailings to what you originally may have planned to secure space.

Rest Of the World
Nationwide industrial action by the MUA resulted in continued delays to imports and exports to and from Melbourne, Sydney, Brisbane and Fremantle. Ongoing delays are experienced as a result, whereby some lines are not calling Sydney and container yards are extremely full. 

While the ports are showing some signs of recovery since the strikes last month, they are still slow going. Carriers are seen to bounce containers from vessel to vessel trying to get as many units on board each feeder from Asia to Australia. Berthing times are also sliding back indicating some congestion/backlog at the ports. 

Due to this, public schedules remain very unreliable. These delays are expected to last at least another four weeks.

Delays on sailings, shortages of equipment and congestion within ports in New Zealand continue to disrupt supply chains. A key concern is cargo into and out of New Zealand via Auckland with 11 ships queuing in the Hauraki Gulf late last week. Shipping lines are rolling bookings and some are cancelling bookings altogether. Shipping lines are working to clear their rollover backlog, which is impacting space through to end of January. However, bookings to Asia and further afield are moving without too much disruption.

Space and equipment is starting to free up from North Asia to New Zealand but then with scheduling issues and delays once in New Zealand waters, reliability is still a problem. South East Asia is also being impacted by space and equipment challenges. Due to this increased demand for space, FAK (freight all kinds) rates have hit record levels and shipping lines are pushing General Rate Increases with alarming regularity and will continue to do so into the New Year.

India’s container shortage could last another three months, as congestion hits Colombo and shippers call for tighter regulation of freight rates.

The acute space problem over the past few weeks was the result of increased demand, reduced imports and port rotation issues.

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