Global Equipment and Capacity Update

This week all carriers have reported severe shortages of 40ft high-cubes at depots, and there has also been a run on 40ft standard boxes, with even 20ft containers beginning to show as unavailable at times.

Meanwhile, the empty equipment so desperately needed back in Asia is scattered around depots across Europe, particularly in the UK, where embattled ports have been forced to limit the restoration of containers back onto already overcrowded terminals.

A recent Alphaliner report stated, ‘All containers are very much in need; they still spend on average 45 days empty at depots, especially in regions with low container availability such as China and the US, the average is comparably high, with 61 and 66 days respectively, compared with the global average of 45 days.’

Shipping lines have announced the temporary suspension of cargo bookings into South China next month, blaming reduced capacity from local feeder operators. The move has prompted dismay among local forwarders who have warned customers “not to hesitate” to take any chance of booking cargo prior to Chinese New Year, which falls on 12th February. Last week, OOCL reported a “sharp” drop in available feeder capacity, due to Covid quarantine rules affecting ship crews, telling customers it would suspend bookings for South China ports from as early as 11th January until 23rd February. And ONE made a similar announcement highlighting restrictions will begin on 5th January and continue at some ports until 26th February. Ports impacted include Guangdong, Guangxi, Hainan, Yunnan, Guizhou and Fujian.

There have been reports of vessels leaving China underutilised on some trades, due to the chronic lack of equipment with forecasters expecting the challenges to continue until after Chinese New Year.

The other option available to lines is to increase vessel speeds – faster service unlocks structural capacity in a shipping string – although this does come with increased costs.

Southampton Port Update

Due to a backlog of trucks Southampton port is stopping vehicles from entering on their booked VBS slots today. VBS slot times of 06:00, 07:00 and 08:00 have had their slot times pushed back to 09:00, 10:00 and 11:00.

We are also aware that the empty container issues at Southampton port are gradually worsening:

  • ONE are now refusing to accept any empties back into Southampton. Suppliers are being offered Manchester, Liverpool, London or to wait until Monday.
  • CMA empties are going to Portsmouth which incurs an average additional £150 per container from suppliers.
  • HAPAG are continuing to restitute in Southampton however the depots available are only open between 08:00 and 17:00 which are times drivers historically are away from the port area. Due to high volumes, these depot queues can be anything up to a 6hr wait.

Any empty containers returning by rail are also bound by the above parameters and charges. Due to the disruption at Southampton as they struggle to move boxes around in time, there is already an increase in the number of rail failures. Furthermore rail providers have very little control meaning recovery options are limited and a quick recovery may not be a viable option if a container fails to rail.

Our Customer Success teams will continue to keep customers updated on affected shipments as we remain focused on finding the best possible solutions at this challenging time. 

This month we’re celebrating 3 fantastic announcements from BIFA.

Congratulations to Harry Wilson, our apprentice based at our Tilbury, UK office for being recognised as an APPRENTICE of the YEAR 2020 finalist. Harry joined us in August 2019 as part of our International Freight Forwarding Apprenticeship Scheme and has taken on a wide variety of responsibilities, both within his apprenticeship remit for ocean freight exports and in other areas such as ocean, road and air imports. Showing a great passion for Freight Forwarding we are sure Harry will have an incredibly successful career ahead of him.

We are also proud to announce we have been recognised as a finalist in two further BIFA categories – the SUPPLY CHAIN MANAGEMENT award and AIR CARGO SERVICES award.

Well done to everyone across the business. Again and again we receive recognition for the innovative approaches we have when working with our customers, and every Ligentia colleague has a part to play in that success.

 

 

Since global cargo flows were hugely reduced in Q2, as the world went into lockdown, we are now seeing an unpredictable boom. The SCFI to Northern Europe is now at its highest rate since early 2015, globally the SCFI is at its highest since 2009.

SCFI_2015-2020.png

Source: Alphaliner

 

With demand exceeding supply, carriers are constantly having to review what they can accept on vessels through allocation management.

We are experiencing, like all providers, allocation restrictions as lines attempt to ensure that all customers have some space available. To assist in this shipping lines have also withdrawn from some commodity markets on a case by case basis with examples being PPE (due to slow moving unloading) and agricultural products (as they prefer to have empty containers returned as quickly as possible to China rather than waiting for full loads).

Allocation management is a constant process with all lines and the Ligentia teams are in regular communication with revised forecasts to protect space to the greatest extent possible.

Are you Brexit Ready?

If like many you are still unclear of the requirements to be Brexit ready from 1st Jan 2020, and missed our series of Brexit live Q&A sessions, please click on the links below to listen to some of the key areas discussed.

Webinar 1

Find out how the UK government has introduced the new border controls in three stages up until 1st July 2021 and what that means for your business.

Webinar 2

Gain more in-depth knowledge of Authorised Consignor and Consignee status as well as review the basic checklist that all businesses should have in place.

Webinar 3

Find out the latest TSS (Trader Support Service) information for Northern Ireland and how the Border Control Model has been amended.