Britain’s biggest container port at Felixstowe has become clogged up with 11,000 PPE containers which are continuing to affect services significantly. Further issues with pre-Christmas and pre-Brexit stockpiling, increases in throughput from China and issues with the new Customs Declarations Service (CDS) systems are predicted to worsen the situation even further.
CONTAINER SPACE SHORTAGE AT THE PORT OF FELIXSTOWE
30% of the container space at the Port of Felixstowe is now taken up by Government's PPE. Sources claim that The Government is understood to have nowhere else to store it. Unfortunately, there are further issues caused by a massive increase in orders placed by several firms. This spike appears to attributable to businesses both attempting to restock after the COVID-19 lockdown and also to stock up before the end of the Brexit transition period.
The Daily Mail warns, “Shops could see stock shortages this Christmas as 11,000 shipping containers full of PPE bought by the Government are stuck in Britain's busiest container port in Felixstowe.”
A Felixstowe spokesperson informed The Guardian that the containers being at the port since August, “does create additional pressure on top of a more general spike in volumes being experienced worldwide”.
The port responded that it is “proud to support the government and to play a small part in helping ensure the NHS does not run out of vital PPE during this pandemic”, and they are working with the Health Department to get the containers moved from Felixstowe. Unfortunately, there doesn’t seem to be any date announced for this currently.
CHRISTMAS, BREXIT & CDS CONCERNS
The industry is feeling the effects of the increased demand from the COVID-19 PPE supply chain, as well as the resupplying and stockpiling of vendors with goods pre-Christmas, and pre-Brexit.
Earlier this week, there were warnings of the risk of widespread disruption at Channel ports after Brexit. The Customs Declarations Service (CDS) is planned to replace the old Customs Handling of Import and Export Freight (CHIEF) system. New IT systems that are being set up to handle the transit of more than 17,000 goods a day are believed to be unlikely to work for the foreseeable future.
With 6.3 million movements of goods estimated under transit arrangements every year – the new network is said to take 45 minutes longer than the current process for each single customs declaration. These essential checks on goods entering and leaving the UK from Kent are likely to cause widespread chaos due to this new untested and incomplete system. Des Hiscock, director general of The UK Association for International Trade, said that the consequences could be catastrophic and added the new system ‘does not make sense’.
Recent meetings with our governing body, BIFA, advised regarding the CDS that, “Customs have a target date of 2021 to commence with CDS, but 2022 seems more realistic”.
CHINESE PORTS & EQUIPMENT SHORTAGES
The ports of Tianjin, Qingdao - North China, Shanghai, Ningbo-, Xiamen, and Shenzhen, Hong Kong all posted a growth rate of over 20%. Export container volume of the eight ports has increased by 19.8% year-on-year. This surge in container volumes coincides with the reinstatement of blanked services on the Asia–Europe & transpacific services, increasing freight rates, and the severe shortage of empty containers at major Chinese ports.
The cargo throughput of China’s major coastal ports has increased by 23.1%, putting enormous strain on the lines to redistribute and return empty containers to their ports of origin. This is having a major impact on available equipment. Available equipment simply cannot supply the demand and this is seeing unprecedented hikes in ocean freight rates.
THE OUTLOOK
Unfortunately, we do not foresee the imbalance of containers being resolved very quickly as vessels and liners must try to redistribute empty equipment to correct load ports. We believe this could impact the industry until at least the Chinese New Year (February 12).
JAG UFS ARE HERE TO HELP
We appreciate that this situation can cause significant issues for some of our customers. Please trust that we are doing everything we can to ensure that we ship your goods as quickly as possible during this challenging time. We are dedicated to working with shipping lines on your behalf. We are providing alternate rates to secure the space and equipment for you, prebooking in advance as much as possible. Please note that sea freight rates are continuing to rise due to this unprecedented demand and we advise customers to contact us to secure bookings as early as possible.
Kind Regards
Gary Wilcox
CEO – JAG UFS Group
