Due to the ongoing global impact from the COVID-19 pandemic, customers should be forewarned that despite best efforts, container space and pricing remains an issue.
Equipment shortages in Asia, for instance, are worsening as importers in the United States and Europe struggle to return empty containers to China and other Asian manufacturing hubs, casting doubt as to whether the international supply chain is ready for peak shipping season.
Some shipping lines have stopped taking all booking for imports to New Zealand stating that they do not have space. Multiple shipping lines have adjusted NZ schedules and omitted ports. Chris Edwards, Freight Forwarders Federation President was quoted in Newshub saying “…ships are bypassing Auckland to go to Tauranga, or now, worse, not coming to New Zealand at all.”
In addition to this, worker strikes at Australian ports, and capacity constraints in New Zealand are turning this into a cargo crisis which could last beyond Christmas.
In Australia, shipping lines held vessels off-shore waiting to get a slot to discharge and reload, but many made the decision to bypass Sydney and go to Melbourne to discharge both Sydney and Melbourne cargo; this forced exporters to either relocate cargo to Melbourne or wait for the next available vessel and pay the cost to store full trains and containers at the port precinct.
Just last week, Alphaliner highlighted a significant increase in cargo demand in Australia, coinciding with the country’s peak season. “The rise is fuelled both by the Far East-Australia trade itself and by increased transhipment activity to and from other regions,” according to the analyst. It said spot rates into Melbourne were the highest in a decade, having more than doubled since mid-March to US$1,648, as per the Shanghai Containerised Freight Index (SCFI).
Even when overseas freight has unloaded in Sydney, importers were hit with haphazard shipping surcharges equivalent to about A$1000 for 40 containers landed in September and early October as shipping lines sought to extract compensation for their long wait off the coast.
Worse still, certain shipping lines have completely cancelled bookings as they look to return to a normal rotation for their service.
We appreciate that the shortage of shipping space is creating a significant strain on our clients. While we are doing our best to ameliorate shortages and price increases as a result of the situation the impact will be felt over the months to come. We will continue to monitor developments and keep in touch with you.