Global Logistics Market Update: 16 May, 2022

Excessive Covid restrictions and lockdowns in China could lead to a mass exodus of foreign staff and the public holiday Ascension day on the 26th could lead to local disruption in Europe.

Macro Update:

Foreign firms in China are bracing for a “mass exodus” of staff this summer, due to the country’s excessive Covid restrictions and lockdowns. Although more companies have been given the green light to restart operations, businesses allowed to resume production under lockdown are, on average, operating at 46% of their total production capacity. 

The Chinese authorities have signalled the restart of manufacturing and shipping in the Shanghai area, but so far it appears to be faltering, according to observers who report many factories are off to a limping start, at best, hobbled by lack of materials, drivers and workers. Read more about disruptions in the region in our Asia section below.

The U.S. and European Union plan to keep addressing supply chain and other disruptions as they project a unified front against Russia. High-level officials began talks starting last Sunday to discuss cooperation on trade and technology issues in Paris.

“The Trade and Technology Council intends to develop common approaches and explore shared solutions toward improving supply chain resiliency, fostering predictability and diversification of trade,” the two sides released in a joint statement.

The Ascension Day public holiday may lead to delays in the processing and delivery of your shipments in various parts of Europe. Read more in our Europe section below.

Service Updates:

Australia & New Zealand

Flooding and extreme weather conditions across NSW and Queensland are causing delivery delays for items coming in and out of these regions. Local deliveries in flood-affected areas continue to be impacted. 

Aramex labor shortages also continue to affect services in specific regions such as Perth.

Fulfillment services: Operational and as per SLAs.

Inbound Receiving services: Operational and as per SLAs.

Direct injection International services at this time: No delays

Australia Post: Local deliveries in flood-affected areas continue to be impacted. Read about Australia Post disruptions here.

Aramex: Services are affected across the country. Read more about Aramex disruptions here.

New Zealand Post: 

Mail item delays:

Due to precautionary maintenance on some of our electric mail buggies, delays of up to 3 days are expected for mail items across the country. These delays only impact mail delivered through their Paxster fleet – not Courier or Rural items. As our posties continue to deliver mail with a reduced fleet and through other means of transport, there is a small backlog forming. This will clear once the Paxters are back up and running.

Parcel item delays

In the North Island, we are experiencing delays of up to 2 days for parcel delivery in the following locations: Whangarei, Waikato and Palmerston North. In the South Island, we are experiencing blanket delays of up to 2 days for parcel delivery.

Asia

Shanghai

  •  Key manufacturing businesses in the automotive (e.g. Tesla), life science, chemical and semiconductor (e.g. China’s chip champion Semiconductor Manufacturing International Corp) sectors will be given priority on the so-called white list as Shanghai eases virus prevention and control measures.

 

Beijing

  • Beijing residents must prove they are Covid negative to enter public spaces in a major tightening of restrictions in the Chinese capital.

 

Zhengzhou

  • Streets were deserted in the central Chinese city of Zhengzhou on May 4 after the local government imposed restrictions on movement and ordered mass COVID-19 testing to contain an outbreak of coronavirus.

 

Hong Kong

  • A further round of restriction easing is scheduled to begin May 19, with the hospitality sector given the green light to reopen
  • The airline Cathay Pacific carried 92,361 tonnes of cargo last month, an increase of 26.3% compared to April 2021, but a 43.6% decrease compared with the same period in 2019.
  • Regarding cargo, the flight capacity continued to recover in April and operate the first freighter flights to Europe since last Dec. Nevertheless, the cargo flight capacity remains about 29% of the pre-pandemic capacity.
  • From June, Cathay intend to add back long-haul freighter destinations in Europe and the Americas, and resume freighter services for the UAE, Saudi Arabia and Cambodia. Whilst the ongoing anti-pandemic measures in Shanghai and other parts of the Chinese Mainland continue to affect overall market demand.

FedEx: To continue to manage volume into Shanghai (PVG) due to the continuation of the COVID-19 lockdown and staffing limitations, the following international freight services remain suspended until further notice: 

  • FedEx International Economy Freight (IEF) 
  • FedEx International Priority Freight (IPF) 
  • All TNT Services

US

Fulfillment services: Remain unaffected by delays and same day dispatch is being met as per SLAs.

Inbound Receiving services: Operational and as per SLAs.

Shipping services: Operational and as per SLAs.

Canada

Fulfillment services: Operational and as per SLAs.

Inbound Receiving services: Operational and as per SLAs.

UK

Fulfillment services: Operational and as per SLAs.

Inbound Receiving services: Operational and as per SLAs.

Yodel and Royal Mail services:  No disruptions or delays

Royal Mail: No disruptions or delays

International from the UK: We are seeing slight delays for DDU, not DDP deliveries, where there is an IOSS number. Average delivery times of 5-8 day are now taking 8-11 days. We encourage all customers to have their IOSS number as this helps with improving the clearance process to deliver into the EU.

EU

Bulgaria

Bulgarian post has informed that they are still experiencing the IT issues that have been ongoing since the 16th of April 2022, due to a cyberattack. Currently, the IT systems still remain down. As a result, the post will not be able to provide tracking details and is unable to meet delivery standards until the IT systems operation has resumed.

FedEx: Due to internal and external events, FedEx is currently experiencing service disruptions, which could result in temporary delays to services in Europe. You can read more about which services are affected here.

Landmark: 

For Europe, they are experiencing delays of minimum one week for the following countries: 

  • Bulgaria (due to a cyber-attack) 
  • Czech Republic Malta (due to limited air capacity) 
  • Portugal 
  • Romania 
  • Sweden 
  • Ukraine (due to the conflict with Russia)

Ascension Day:

Please note that on May 26th Landmark’s Brussels warehouse (EMC) will be closed due to the public holiday “Ascension Day” and this is also a public holiday in the following countries: 

  • Austria 
  • Andorra 
  • Denmark 
  • Finland 
  • France 
  • Germany 
  • Liechtenstein 
  • Netherlands 
  • Norway 
  • Sweden 
  • Switzerland 

This public holiday may lead to delays in the processing and delivery of your shipments.

Fulfillment services: Operational and as per SLAs.

Inbound Receiving services: Operational and as per SLAs.

Freight Forwarding Update:

Sea freight - Asia to north America

We’ve seen a slight drop in pricing for LCL and FCL, however rates are still elevated. 

Space: We continue to experience space issues with most carriers

Booking: We recommend booking well and truly in advance (5-6 weeks), we cannot guarantee that the space will always be available.

Sea Freight - Asia- Europe

Rates are still at record highs, although they have gone down slightly. 

Space: Continues to be a concern

Booking: We recommend booking well and truly in advance (5-6 weeks).

Sea Freight - Asia - Australia

Pricing is still relatively elevated.

Space: Continues to be a concern

Booking: We recommend booking in advance (4-5 weeks).

Air freight

COVID-19 and Russia’s invasion of Ukraine continues to impact services and limit capacities globally.

Direct injection

B360 has its own Direct Injection network that runs from Sydney to the US, Hong Kong to Europe, Hong Kong to Australia and Hong Kong to the US. These channels are still very reliable, with transit times on average being 4-8 days, we see no changes as per the SLAs at this time.

To learn more about any of our updates or to make carrier changes, please reach out to us today.