The past two weeks has seen the biggest disruption to shipping between Asia and the UK that we’ve seen in over ten years. We’ve been updating customers who are and may be affected by this but feel that we should give all customers who have used our service in 2020 an overview so you can plan ahead if you have, or are considering, importing over the coming months, which is why you’ve received this email.
Delays of a week or more
We are currently seeing most vessels delayed by at least 7 days. These delays are happening within a week or the vessels are due to land in the UK so it’s very hard for importers to plan for them. Added to this there is a lack of space on the vessels leaving China. This can mean that if a customer books a full container there may not be space on a vessel for over two weeks (last week we heard that December was the next availability for two of the major shipping lines). Fortunately, our weekly shared containers are relatively unaffected by this as the space is pre-agreed.
Crazy price increases
We are currently trying to hold our prices for shared container load shipments, however, full container load prices have rocketed. Sea freight rates that were less than $2000 a couple of months ago are now routinely over $5000 (with some as high as $8000).
Why the disruption?
The shipping industry between Asia and the UK has been shaken in 2020. Various Covid-19 restrictions and global lockdowns have meant that the demand for imports has been higher than this year’s production ability. Often, increased demand in the UK has been met with restrictions in Asia that have stemmed the supply. We are now seeing a situation where there are more containers waiting to be shipped that there is space on the vessels in service to ship them. This has led to the huge rate increases that we’ve seen as companies outbid each other to have their container shipped first.
Delays have mainly been caused by the inability of the UK’s ports to cope with the increased traffic. Over the weekend we’ve seen the mass media picking up on this story too. As the ports are struggling to offer berthing slots to all the planned vessels, the shipping lines are being forced to change their routes. Rather than landing in the UK as planned, they are having to go to mainland Europe first and come back a week or so later. Last week we even saw a shipping line claim “Force Majeure” and claim that they weren’t able to come to the UK so would have to off-load the containers destined for the UK, in Rotterdam, until another vessel was able to collect, and get them to an English port!
Planning ahead
The usual rush for importers to meet the Christmas market has been exacerbated by huge volumes of PPE, pre-Brexit stockpiling and the stop-start nature of the Asia production as various restrictions ripple through the world. Although into the new year some of these factors will dwindle, we expect at least some disruption to be in place until the Chinese New Year in February 2021 allows the UK ports to come up for air and get back on an even keel.
Although we expect a turbulent time for full container shipping over the coming months, we have, so far been able to prevent any major rate increases for our shared containers from China. We hope the delays will reduce in frequency following the Christmas rush but would suggest assuming shipments will take a week longer than our usual estimates until March 2021.
If you have any questions, please don’t hesitate to contact us at any time if you wish to discuss this further or would like our opinion on planning ahead in the current market.