Explaining the industry’s issues
We are sure you are more than aware by now of all of the issues that are currently being faced industry wide as a result of the pandemic. We wanted to explain in a more in-depth way how these issues might affect you and what we at IFE are doing to help.
If you are importing into the UK currently, you will be well aware of the severe issues surrounding the UK Ports. Not only are we experiencing vessel arrival delays due to congestion, but it has come to light that the UK Ports, Felixstowe especially, are struggling with the level of shipments arriving.
There has been a huge spike in container shipping volume, and the Ports are grappling to cope with this influx. With less staff comes slower operational levels, therefore containers are taking much longer than before to offload at quay.
If this wasn’t enough, there is a serious lack of vehicle booking slots for the hauliers to obtain, and the ports and shipping lines are offering no leeway in terms of rent/demurrage for the periods of time your container may be awaiting delivery due to these delays. Delivery slots are hard to come by, and we are experiencing many more late runners than ever before due to the Port issues.
Over the last few months, Felixstowe Port in particular has shut due to bad weather multiple times, and also shut out receiving any empty containers on more than a few occasions, whereby as a result we experienced many vessel diversions and severe delays for clients. (https://theloadstar.com/felixstowe-bans-empties-again-as-congestion-builds-and-vessels-cut-and-run/) All of these issues have resulted in a major backlog of shipments awaiting delivery, meaning delivery slots are much harder to obtain.
Our team here have been working tirelessly to meet deadlines where we physically can and are doing their best to keep everyone as informed as possible. We expect that these issues will worsen in the run up to Christmas. Felixstowe port have appointed a new boss in an attempt to “stop the rot” at the Port – fingers crossed for improvements. (https://www.ipswichstar.co.uk/news/business/felixstowe-port-appoints-new-boss-chris-lewis-1-6910678)
The below is a really insightful video that highlights some of these issues:
https://www.ipswichstar.co.uk/news/business/video-diary-of-felixstowe-vbs-problems-1-6901837
The issues at the UK Ports has resulted in a lack of export shipments to the rest of the world. Consequently, there is a major container equipment shortage across all shipping lines, scrambling for available containers for shipping. The build up to Christmas and a further peak in demand is only worsening the situation.
Vessel space particularly from Asia and India is at the lowest available level we have seen in industry history, and more and more vessel sailings are conditioned as “roll over” space, causing further delays. The continuing increase of freight rates is a result of both equipment shortages and tight vessel capacity, which is reportedly expected to continue into the first quarter of 2021.
We kindly ask clients to submit any bookings as far in advance as possible to try to avoid further delays. In the meantime, our team are constantly doing our best to fight through these industry-wide issues, but if you do have any questions or queries, please do not hesitate to contact us.
We also wanted to include some insightful articles further explaining these issues in case they are helpful at all during this time:
https://theloadstar.com/ocean-carriers-still-holding-the-upper-hand-with-spot-rates-sky-high/
https://theloadstar.com/indian-shippers-and-carriers-in-war-of-words-over-box-trade-imbalance/
The recent launch of Apple’s new iPhone 12 has caused a big capacity squeeze in what was a limited market already due to all of the COVID-19 issues of 2020. When a new Apple product is launched, a large portion of the space from China is booked up which causes a huge shortage for everyone else –driving the rates up… Higher demand (for what is left) equals an inevitable increase in rates.
At IFE, we have been busy trying to help manage this issue for our customers, using a mixture of pre-allocated space with contracted carriers and also looking at other routings and alternate services during the ‘squeeze’.
Please contact us to let us help you manage your freight movements during a particularly busy time of the year – and beyond.
https://theloadstar.com/strong-air-freight-demand-fighting-tight-capacity-pushing-rates-higher/
