BIFA trophies

Freight industry award finalists

Feb 7, 2024 | , , , , , , , , , , , ,

The British International Freight Association (BIFA) is the trade association for the freight, logistics and supply chain management sector. Their annual Freight Service Awards are the industry’s most contested and highly sought trade awards, because peer recognition is the ultimate accolade.

BIFA’s 35th and biggest Freight Service Awards – with over 500 attendees and a 30% increase in award entries – took place three weeks ago in the City of London, with Metro overcoming the increased competition, to be selected as finalists in the Sustainable Logistics and Specialist Services categories.

Grant Liddell, Metro’s Managing Director. “Our solutions, technology and customer focus are truly leading-edge and being selected as finalists in BIFA’s Freight Service awards yet again is recognition of that capability and is an independent endorsement of the value that we deliver consistently.”

Metro’s submission for the Sustainable Logistics Award described how a client’s commitment to create more sustainable supply chains was supported by three Metro initiatives, that focused on their critical air freight channel.

Over a two-year span Metro created:
1. A cloud-based tool to measure and monitor the CO2 emissions of every shipment
2. Became the first UK forwarder to invest in the Sustainable Aviation Fuel (SAF) programme
3. Participated in Sustainable Flight Challenges to generate CO2 savings exceeding 37%

The critical insights gained from the Sustainable Flight Challenges were invaluable in developing the operational templates that are now paving the way for a more sustainable air freight channel for the featured client.

Metro’s focus in the Specialist Services Award category was to highlight the value that we add, to enhance the freight element, and the difference that makes to our customers.

The Metro entry, chosen by the judges as a finalist, outlined how, at a time of limited transport capacity, a car manufacturing client’s finished vehicles were safely shipped to international markets, using a solution that reduced transit times, cut costs, lowered emissions and avoided disruption at destination.

By building connectivity between Metro’s supply chain management platform and the client’s ERP system, together with visibility of critical supply chain milestones, the client could grant their dealers direct access to Metro’s visibility tools, providing reassurance on vehicle orders in transit.

With Metro’s solutions the client could continue delivering customer orders in a challenging environment, with the solution running for over 12 months, to protect tens of millions in sales.

If you would like to learn more about the solutions highlighted here, please EMAIL Andrew Smith, Metro’s Chief Commercial Officer. 

steel in car manufacturing

Red Sea diversions disrupt China’s car supply chains

Jan 24, 2024 | , , , , , , , ,

Carmakers had been struggling with a lack of car carrier RoRo capacity before the Houthi attacks began in the Red Sea and now with NYK and K Line suspending sailings via the Suez Canal nearly all big car car-carrier operators are diverting round the Cape of Good Hope, further reducing already squeezed capacity on the key trade route.

The boxlike RoRo car carriers ship thousands of vehicles and are vital in transporting cars between key Japan, China, South Korea and European markets, with long-distance ocean car shipments up 17% in 2023, largely because of big increases in exports from China and comes after large numbers of car carriers were scrapped during a market downturn in 2020. 

The extra 3,500 miles around the Cape means car makers will be able to transport fewer vehicles annually, as the global fleet’s effective capacity is cut and the 185 new vessels on order with shipyards this year are expected to increase fleet capacity by only 7%.

China may have overtaken Japan as the world’s largest auto exporter in 2023, with car exports jumping 62% to a record 3.83 million vehicles last year, but the shortage of seaborne capacity is putting the brakes on their ambitions in the UK and Europe.

With a few exceptions there is no immediate prospect that car carriers will return to their traditional Suez Canal route until they believe there’s a safe transit and with the current threat in Yemen, it is not felt that any military protection will be sufficient.

With about 25% of global, long-distance RoRo seaborne movements of cars typically moving through the Suez Canal, only container shipping is suffering bigger a upheaval as a result of the current problems in the Red Sea. 

However, the challenges for car-carrier operators are fundamentally different from those for container lines because there was a global excess of container ships before the latest crisis and container shipping lines have been able to reactivate idle ships to replace the capacity lost to longer journeys. 

While car companies have built up some extra inventory in key markets over the past year, they will run those stocks down as new vehicle deliveries from Asia are cut.

If you have questions or concerns about your automotive supply chain, trade with the Middle East, Africa, Indian Sub and beyond or any of the issues outlined here, please EMAIL our Automotive team who are standing by to assist.

Lloyds

Insurers withdraw war risk cover

Jan 24, 2024 | , , , , , , , ,

Since December 2023, nearly 30 commercial vessels transiting the Red Sea have faced missile strikes or near misses from the Yemen-based Houthis, including container ships owned by Maersk, MSC and CMA CGM.

As of last week, 550 container ships have been diverted away from the Suez Canal or are planning to reroute around the south of Africa via the Cape of Good Hope to avoid Red Sea attacks.

Some ships are still travelling through the Suez Canal. Beijing has been neutral on the Houthi attacks but the disruption has raised freight rates, while France’s CMA CGM is still sending some ships through the canal when they can get French warship escorts.

Last week Lloyd’s and London market marine insurers confirmed that they are continuing to maintain cover for cargo and ships transiting the Red Sea despite increasing tensions, but some ship insurers are starting to avoid covering commercial ships against war risks when they navigate the southern Red Sea.

War-risk insurance premiums have already climbed from 0.75-1% of the vessel's value, which means, shipowners will now have to pay $millions for war-risk insurance cover, depending on vessel age, size and type, with underwriters seeking exclusions for vessels with links to the UK, US and Israel, when issuing cover for ships transiting the Red Sea.

In addition to the soaring annual premium, shipowners will also have to pay an additional premium if they want to transit via the Red Sea. It is because several Protection and Indemnity (P&I) clubs have expanded their additional premium zones across the Indian Ocean, Gulf of Aden and Southern Red Sea.

We have seen evidence however, that some insurers won’t cover anything from a war risk perspective around the Horn of Africa and the Red Sea, which means even more commercial shipping companies will be rerouting through The Cape of Good Hope in the near future.

The massive boost to insurance rates is likely to make the Cape of Good Hope routing more cost effective for carriers relative to the Suez Canal, even with the higher fuel costs.

Metro recommends All Risk marine insurance to protect you against all loss of cargo, to the full value of the goods.

Carriers and other supply chain participants operate under conditions that limit their liability and may even require you to compensate them, in certain circumstances, which means that any compensation you receive is likely to be considerably lower than your actual loss.

Metro work with selected partners to offer All Risk marine insurance cover that protects your cargo during every stage of transportation and storage, on a per shipment or annual cover basis.

Please contact your Metro Account Manager for further information.

Suez MSC vessel

General Red Sea Update

Jan 24, 2024 | , , , , , , , , , , , , , , , ,

The US and UK carried out eight strikes on Houthi targets in Yemen on Monday, as the Iran-aligned armed group continues to target commercial shipping in the Red Sea, with no sign that the conflict will de-escalate anytime soon.

While many hoped that the situation in the Red Sea might be a short-lived crisis, it is edging closer to the challenges that global supply chains faced during the COVID-19 pandemic. 

The ripple effects caused by the necessity of re-routing around 90% of all container ships from Asia around the Cape of Good Hope are immense. Analyst Sea-Intelligence are concluding that the vessel capacity drop is the second largest after the ‘Ever Given’ got stuck in the Suez Canal for six days during March 2021. 

With 10+ days added to the normal transit the drop in available capacity has sent freight rates rocketing, with container equipment challenges growing and expected to become far more difficult in the run up to the Chinese lunar new year. 

CMA CGM, the world’s third-largest carrier, announced an empty container imbalance surcharge of $100 per unit on top of similar equipment surcharges out of Turkey to the Mediterranean and North Africa announced last week.

There is one significant difference between now and the Ever Given situation and the pandemic, which is demand is lower and the shipping lines have injected significant capacity to maintain services. 

The Ever Given disruption occurred during a period of scarce capacity and historic peak demand, which was why rates skyrocketed and while we aren’t currently at those highs, the recent rate surge is noticeable in the short term.

The current delays and projected longer transit times are already impacting manufacturers across the globe, with many forced to halt production due to shipment delays, while many retailers have warned of product delays and cost increases. 

The next two-to-three weeks could be interesting, with bunched vessels arriving at the main ports, potentially triggering port delays driver shortages and cargo build-ups at warehouses.

The window for booking air freight ahead of Chinese New Year is closing and vessels are quickly filling, which is why we would urge you for your shipping deadlines, so that we can book your space and services at the best possible rates. 

Sharing forecasts for your forthcoming movements is an essential tool in managing your freight and expectations, and reserving the equipment you need, when you need it. 

If you have any questions or concerns about the impact of the Suez situation on your Asia supply chain, or would like to discuss its wider implications, please EMAIL our Chief Commercial Officer, Andy Smith.

Category: Supply Chain

Supply Chain | United States

Latest News in this category