Specialists in shipping valuable and hazardous goods
Posted: September 24, 2021Category: Updates

The current state of freight

We pride ourselves on being experts in freight. Here’s our update on the state of freight both globally and locally here in New Zealand, along with some helpful tips and advice for your business.

As we all know, it’s been an extraordinary time in freight, logistics and life in general. The COVID pandemic impact will be with us for years to come in relation to our supply chains and soaring industry costs.

Global Update

Overall, things remain very unsettled in the global freight space. There have been massive increases in costs for import and export along with major delays, and this will continue for some time alongside reduced and unstable services.

We have also seen an increase in documentation requirements e.g. Non-Manipulation Certificate (NMC) and Certificate Of Origin (COO). Free-trade agreements are still being worked on in the UK and Europe and this will continue for some time.

IMPACTS ON GLOBAL AIR FREIGHT

  • Rates have settled somewhat since 2020 but these remain higher than pre-COVID time.
  • There is the continuation of reduced capacity – services are getting better but definitely not as efficient as it was before COVID.
  • Trade lanes are opening up all the time subject to demand eg: main airports are being serviced well.
  • Smaller airports such as Cairns and Philadelphia have reduced services and in some cases have no service. These are often reached by truck from a main port, which means increased transit times.
  • The recent lockdowns in Australia are still having an impact with fluctuating and reduced services.
  • Courier freight is working well but has limitations with capacity and also carries the additional covid related surcharges.

IMPACTS ON GLOBAL SEA FREIGHT

  • For outbound sea freight we are seeing an increase in ad-hoc space opening up between New Zealand and Australia.
  • We are seeing continued rate increases as we come into peak season and a lack of space for inbound (particularly China inbound) and outbound sea freight.
  • Ships are delayed and are skipping port locations regularly to try and keep on schedule.
  • With all the delays and rate changes, ensure you get a quote every time you ship. As an example, if you booked a ship departing on 10 September for $1000 (per 20-foot container) and it is delayed, it can cost upwards of an additional $500 per container if it rolls into a new rate period.

OUR ADVICE
Allow extra time for communication as international agents/staff are generally overloaded. Many may still be working from home and as we all know, this can impact levels of productivity, so there are delays in responses for quotes etc.

SPECIAL ADVICE FOR SEAFREIGHT FOR IMPORTERS & EXPORTERS

  • Plan months in advance for any sea freight, expect delays and prepare for increased costs.
  • Seek updated pricing each time you ship.

SPECIAL ADVICE FOR AIRFREIGHT

  • Planning again is key here - ensure you book ahead and allow extra time. Try and have some flexibility.
  • If you have any time-critical cargo, let us know ASAP so we have plenty of time to create a clear timeframe and can act early on your behalf.

NZ Update

New Zealand courier and road transport services are currently at capacity and this is causing delays and increasing the risk of damage to goods.

Coming out of lockdown will cause major pressure on local transport providers and couriers when everyone returns to work. There is a lot of HELD orders, HELD stock from 3PLs, FCL and LCL Cargo that will be released to the market and demand and volumes will be extremely high, so allow double the normal time for final delivery.

Increasingly there are delayed containers and an imbalance of import traffic arriving at unexpected times compared to pre-covid. This means work requirements across trucking services are at record numbers for delivery and services are unstable.

Industrywide staffing issues (lack of reliable staff etc) are impacting many areas of freight and shipping organisations. Hopefully, we will see some of this ease when borders open up again.

IMPACTS ON NEW ZEALAND IMPORTERS AND EXPORTERS

  • In general, services are not as reliable and efficient as prior to COVID.
  • Delays are putting pressure on all areas of the supply chain from start to finish including staffing and this is impacting the level of service provided.
  • We are noticing delays are affecting cashflow for importers and understand this is a stressful time for many.

OUR ADVICE 

  • Be flexible and allow for extra time in the supply chain.
  • Ensure you understand your insurance policies and that they are up to date.
  • Make sure your goods are well packaged and clearly marked if fragile or if there are special handling requirements.

We are always here ready to help find the best solution for your business. So please don’t hesitate to call us.

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