Back to all news


Supply chain insight: Then to now to 2022

The last year has put all supply chain modes across the globe under significant pressure. What happened?

Issues faced by the ocean freight industry have had an impact worldwide as a maritime string visits more ports than any aircraft routing ever would, creating knock on effects throughout:

  • Impacting vessels of other carriers berthing at same ports
    • Causing delays, missed calls, cancelled sailings
      • Reducing availability of equipment and vessel slots
        • Increasing rates as demand outstrips availability
          • Impacting numerous parties in the supply chain – carrier, ports, tug operators, stevedores, truck operators, freight forwarders, importers and exporters and the end consumer

The Suez Canal blockage further exacerbated the existing issue. Recent, subsequent COVID-19 waves have been disruptive and unpredictable, further reducing capacity and efficiency at all supply chains points due to new Health and Safety procedures implemented in response to the virus.

​​COVID-19 impact timeline on ocean freight:

​​Q1/Q2 2020 – Pandemic outbreak

  • Suspension of many business activities
  • Initial global decline in demand was -14%
  • Shipping lines reduced capacity

Q3/4 2020 – Demand returned:

  • Rapid recovery of consumer demand from June 2020 onwards

Disrupted supply chains resulted in:

  • Container shortages due to demand/supply imbalances
  • Poor schedule reliability
  • Port congestion – globally 300 container vessels awaiting a berth on 14/06/2021 (76 off Yantian)
  • Increased rates
    • Spot rates have increased by a factor of 10 over a 12-month period
    • Freight rates on the Asia-Europe trade lane of the Shanghai Containerised Index breached the $6000.00 per TEU for the first time ever in June 2021
    • Lloyds List reported on the 15th July that spot rates were approaching $18000.00 to $20000.00 for an FEU
  • Rolled cargo
  • Carriers prioritising loading profitable cargo above restituting empty containers
  • Other issues in support industries e.g. lack of drivers to collect/deliver cargo

The current situation has highlighted that current carrier and port capacity is relatively finite and it is difficult to increase this capacity quickly.

How does that impact the USA in particular?

  • The USA is the world’s largest consumer market
    • In the 12-month period to July 2021, consumer demand increased by 10%, having never exceeded 4.7% in a 12 month period previously
  • The US business is replenishing very low inventories
  • This demand has contributed to imbalances in the global container market and significantly impact onward movement of shipments locally

Find out more about the impact on the ground in the US here.

The longer-term impact is expected to affect peak season until the end of the year and beyond (CNY 2022) with mid-value products particularly affected as they get ‘priced out’ and cannot secure the fought-over slots available. The most significant impact has been reported on low value but bulky cargoes e.g. assembled furniture and some sports products such as kayaks.

Coming up





Possible remedies

Rates will remain high - possibly increasing

Will remain tight

Delays anticipated

Shortage of containers

Book early

More surcharges in part to cover higher charter rates

Limited additional allocation

Changes to routing

Productivity issues due to COVID

Maximise container utilisation

Additional port fees, quay rent and demurrage etc

Lack of onshore transport  capacity

Speed reductions

Restrictions on where to collect/deliver

Some cargoes may be suitable for bulk movement

Cancellation of agreements

Carriers will not take low yield freight

Blank sailings


Contact our expert teams to make use of our carrier agreements

For more information or to contact our expert teams to discuss how to minimise the impact on you and your clients, please reach out to us here.

For more supply chain insight, read up on recent relevant articles here:

Shipping FAQ - What's going on in the supply chain industry?

Why is the ocean freight trade still not catching a break?


Related News

17 March 2023

ZA truckers advised to stay off the roads ahead of national shutdown

ZA truckers advised to stay off the roads ahead of national shutdown

Read more

14 March 2023

Woodland Group is selected to join the Twig Logistics Network to support growth of Latin American services

Woodland Group is selected to join the Twig Logistics Network to support growth of Latin American services

Read more

Contact us

We would love to hear from you. Please contact us here: