Barely anyone got through the year of upheaval that was 2020 unscathed, and the shipping and freight industry is no different.
The impact of the global COVID-19 pandemic hit our industry hard.
As the disease took hold, every country around the world took a different approach to managing and suppressing the virus.
Virtually no two countries had the same response, and no two countries had the same result. Even those with initial success often ended up facing a second wave.
Because of the differing responses and resultant levels of success, rules around imports, exports and travel varied wildly from nation to nation.
For an industry rooted in international cooperation, that meant adapting like never before in order to keep moving and stay viable.
The impact was still very much felt, with sky-high freight rates, container shortages and worldwide restrictions causing massive shipping delays across the world.
At the consumer and general public level, the impact is being felt across a wide range of sectors.
This isn’t just a shipping industry issue – it affects everyone.
As you conducted your Christmas shopping last year, you may have noticed significantly reduced availability of stock at your local stores.
That’s a direct result of the problems faced by worldwide shipping in 2020.
Many retailers in Australia missed their shipments at Christmas, the most important time of the year for any retailer in an already difficult environment.
It’s a watershed moment for the industry, but one we’re prepared and equipped to deal with at EES Shipping. No matter what profession you’re in, in times of crisis it’s important to have experts on your side to navigate your way through.
These are the major issues confronting shipping around the world right now:
- A Shipping Container Shortage: COVID-19 led to a trend of containers that were shipped from the Asian continent not returning empty back to Asia. The domino effect of that trend caused an imbalance in the availability of shipping containers right around the world.
- A Shortage of Ships: In a normal year, around 5-10 percent of shipping vessels worldwide are available or not currently active. Right now that rate sits at about 1.4 percent, meaning freight options are even further restricted.
- Chinese exports getting priority: The active shipping lines are skipping export opportunities from Australia and the United States, instead picking up empty boxes and taking them back to China as that option is more lucrative.
- Large increases to rates: While freight rates will usually go up in busy months as demand rises, those rates are now consistently sky-high. Some shipping companies and consortiums are posting Q3 profits up from between 50 to 110 per cent.
Read more here.