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Global Logistics Market Update

Keeping you up to date and informed on the global landscape of the logistics industry

Global Logistics Market Update: 13 June, 2022

Beijing and Shanghai back on COVID alert, US lawmakers to add new regulatory constraints to limit the ability of ocean carriers to levy special fees and 22,000 unionized truck drivers in South Korea have been on strike for over a week, causing widespread disruption.

Macro Update:

Shanghai and Beijing went back on COVID-19 alert on Thursday after parts of China's largest economic hub imposed new lockdown restrictions and the city announced a round of mass testing for millions of residents. Read more detail in our Asia section below.

Making the case for legislation to hold carriers more responsible for shipping costs and service standards, President Joe Biden on Friday laid much of the blame for record-setting inflation data released earlier in the day on the decks of the world’s largest ocean carriers. Whilst at the Port of LA, Biden said “I’ve called on Congress to crack down on foreign-owned shipping companies that have raised their prices while raking in just last year $190 billion in profit, a sevenfold increase in one year.”

House Democratic leaders say they plan this week to take up a measure already passed by the Senate that would add new regulatory constraints to shipping operations and limit the ability of ocean carriers to levy the special fees that shipping customers say are driving up costs. 

The bill would make it tougher for the shipping lines to refuse export cargoes, a practice that has grown over the past two years as carriers have sought to turn around empty containers quickly to return them to Asia and take advantage of high prices for Asian exports. It would also boost the workforce at the Federal Maritime Commission, the main U.S. shipping regulator.

22,000 unionized truck drivers in South Korea went on strike late last week, protesting against soaring fuel prices and demanding minimum pay guarantees. Four rounds of negotiations with the government have failed to find a compromise. Now in its seventh day, even non-unionised drivers have not shown up for work in fear of reprisals from their trade union colleagues, meaning the scale of absent workers could be much larger than we are able to report. 

The steel, auto and cement factories have mostly suspended shipments due to difficulties in moving their cargoes. Transport disruption has also led to major disruptions at ports, factories and in transporting deliveries locally.

Service Updates:

Australia & New Zealand

Fulfillment services: Operational and as per SLAs.

Inbound Receiving services: Operational and as per SLAs.

Direct injection International services at this time: No delays

Aramex: Services are affected in Perth, Melbourne and Wollongong. Read more about Aramex disruptions here.

New Zealand Post: 

Mail item delays:

Due to precautionary maintenance on some of their 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 their 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 Palmerston North. In the South Island, we are experiencing delays for parcel delivery of up to 2 days in Dunedin, Invercargill and the West Coast.

Asia

Expect major disruption at South Korean ports, caused by a large scale trucker union strike which has continued for over a week.

Shanghai

  • Shanghai faces weeks, if not months, of slow recovery until economic activity can fully bounce back from the crippling Covid lock down that began in March.
  • Shanghai's Minhang district said it will conduct nucleic acid tests for the entire population on Saturday and ordered residents to stay home during the testing. 
  • Six other Shanghai districts, including some of its largest, also announced a round of mass testing for the weekend.
  • Many factories and businesses are still closed or operating below capacity. The world’s largest port in the city remains backed up and truck traffic is at about a quarter of pre-pandemic levels.
  • One of the biggest challenges is around inland logistics, in particular trucking to get goods from the factory to the port. The port is also backed up, with as many as 300,000 containers sitting on the docks.

 

Beijing

  • Today, the authorities began a three-day mass testing campaign of Beijing’s most populous district, Chaoyang, home to 5 million residents.
  • Workplaces and residential buildings have been placed in lockdown if a single case is present.
  • No other lockdown measures have been implemented as of yet.

  

Hong Kong

  • Ongoing pandemic border curbs remain one of the biggest issues for foreign business and expatriates. 
  • Mandatory hotel quarantine is still required for anyone entering Hong Kong, unless they’re coming from mainland China.

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.

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

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.

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.

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