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Logjam – Post-Suez ripple

In Delays Posted April 14, 2021 at 1:23 pm
By David Thatcher

Logjam

According to Loadstar and supply chain visibility platform Project44, as much as 1.9m teu of cargo is about to be caught up in the supply chain congestion logjam set to engulf many of the world’s largest container ports. These hubs expect a short-term surge in ship calls in the coming days as carriers try to get services back on schedule.

Over 370,000 teu of capacity is currently heading to the world’s largest transhipment hub in Singapore, adding to the 299,310 teu already waiting to unload, as of 12 April.

New York is facing a backlog of 76,500 teu, either having arrived or still inbound, Malaysia’s Port Klang has 103,900 teu, and Dubai is expecting 75,879 teu.

As ports wrestle with the congestion, sailing schedules will be affected, and port delays will increase – not to mention road transport, last-mile delivery and inventory management teams.  The full impact will not be apparent until the cargo begins to arrive.

However, even before the Ever Given logjam, supply chain logistics have been thrown off-kilter by shifts in consumer demand due to COVID-19. The impending congestion in Europe is also likely to interrupt the flow of export containers back to Asian markets.  This problem will compound as stimulus cheques pull-through demand for Asian consumer goods into the US.

Minimal air traffic capacity is unlikely to be much help.

Ports across Europe have commenced preparation for the influx of container traffic by renting additional space, delaying export bookings, implementing tight arrival windows and handling freight around the clock.

In terms of rates, Europeans expect to see an increase in Asia-Europe rates from the pre-logjam levels. While we know that a disruption in one part of the global supply chain has a ripple effect that flows around the world, it is unclear what impact this will have on Asia-Australia conditions and rates.

If you’re concerned about the ripple effect on your imports and would like to explore your options get in touch with our sales team on 1300 651 888.

Suez flowing again – implications for Australia and New Zealand importers

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