Ningbo

COVID outbreak impacts Ningbo port

Jan 13, 2022 | , ,

The suspension of trucking services in several parts of China’s Zhejiang province, followed a COVID outbreak just over a week ago and has slowed the movement of cargo through one of China’s biggest and most important ports, Ningbo.

Strict controls were imposed on lorries moving goods to or from the Beilun district in Ningbo after the discovery of several cases of COVID in the area.

This suspension, along with restrictions on truckers in some areas in and around Zhejiang, halted operations at some yards and warehouses at Ningbo port.

The curbs began last week after the city reported an outbreak of COVID which led to the closure of container freight stations and factories in the Beilun district near to the port, raising fears that importers would be unable to stock up their inventories, forcing them to look for alternative shipping or products, which may feed into higher costs for the consumer.

Ningbo is one of the world’s top container gateways and a crucial part of the global supply chains that connects importers to factories in East China. The port was partly shut for weeks last August after a COVID outbreak, causing a slowdown in exports, disruptions and congestion across supply lines.

Container loading and discharge operations at Ningbo port have been operating normally, but the impact on trucking and access to the port has been severe, making it extremely difficult to bring containers in or out, adding to concerns that shipping lines may decide to omit Ningbo.

With just a few weeks until Chinese New Year many shippers have been diverting consignments to alternative ports, particularly Shanghai rather than risk long landside delays at Ningbo.

Yesterday the trade press were reporting that a major complication is the lack of trucking permits for commercial vehicles to enter the Beilun district, with just 6,000 permits released for the 20,000 trucks in the area and truckers with permits must take two nucleic acid tests in three days and are required not to leave their vehicles while in the marine terminal. In a customer-advisory, Maersk said that just 10% of trucking capacity is operating in the Ningbo area.

In a fast-moving situation, our network partners in Ningbo have confirmed that the port and local trucking has resumed normal operations and they expect that any backlog will be cleared quickly.

Elsewhere, nucleic acid testing for drivers are creating delays for local trucking and transport in the Shenzhen and Tianjin areas, but the cities are not closed and port terminals are operating normally.

Metro are operating our own container vessels within our group of companies from Ningbo and Shanghai directly to the UK for discharge and reloading. We have vessels loading this week at both ports and have not experienced any impact with departures operating on time against our schedules as we use alternative terminals. Once they have left China they do not stop at any further ports en route and we can achieve the fastest available transit into the UK for our customers. 

For further information please contact Emma Hulbert who can discuss your specific requirements and share detail of the programme which will be running continually throughout 2022. A very exciting and unique platform available through Metro.

Supply chains have never faced so many challenges and with local conditions changing rapidly it is critical that you have the support of dependable partners. 

Metro will always share the latest news and most important developments, providing you with the best alternatives and options, to keep your supply chain optimised. 

For further information and to discuss your ongoing requirements please contact Elliot Carlile.

Lloyds

British businesses investing in 2022

Jan 13, 2022 | ,

According to research carried out by consultancy Deloitte, the UK’s top firms will massively increase capital spending in the next 12 months, with over 30% of chief financial officers (CFO) at Britain’s premium listed firms scaling investment to capitalise on red hot domestic and foreign demand.

Deloitte surveyed 85 finance chiefs at firms which have a combined market value of nearly £500bn, representing 19% of the entire UK stock market.

CFOs seem to be looking past Omicron and plan to focus their businesses on growth in 2022, with 90% intending to expand their technological capacity in a sign that the productivity gains made by the rapid adoption of digital tools since the onset of the pandemic are set to continue.

Finance chiefs expect their gamble on investment to pay off, with 84% forecasting it will yield productivity enhancements.

This is certainly an approach that Metro, and our associate businesses, have taken, and plan to continue taking, over the foreseeable future with many initiatives and huge investment in our digital platforms. Embracing the latest technology, we continue to design, develop, create and deliver new and enhanced internal and external systems and applications.

And firms are more optimistic about operating in a post-Brexit environment. Worries that dominated the risk list in recent years – above all Brexit and weak global growth – have dropped sharply down the risk rankings.

However, Deloitte’s research indicates businesses are under intense pressure to survive amid a barrage of soaring costs and an ongoing labour squeeze, with 54% highlighting inflation as a key risk to their businesses’ performance, while 58% are concerned over persistent worker shortages.

Optimism dipped over the last month, driven lower by the threat of inflationary pressures and the hit to consumer confidence from plan B restrictions to curb the spread of Omicron.

At the same time, UK manufacturing supply chain disruptions eased in December, helping activity in the sector to expand at the fastest pace in four months. A positive indication of things to come in 2022.

Supply chains remain severely stretched, but the situation is stabilising, with vendor delivery times lengthening to the weakest extent for a year in December, which helped take some of the heat out of input price increases, and raise output across the consumer, intermediate and investment goods sectors during the final month of 2021.

The increased output was underpinned by rising intakes of new business as domestic market conditions strengthened.

With so much negative news abounding, it is heartening to see a positive business survey, that confirms some of our biggest firms will be investing for growth in 2022.

We certainly intend to continue our development, expanding our team, investing strategically and working with our network partners to grow our service portfolio globally.

Whatever your objectives are for the year ahead, we are ready to support you too, with supply chain solutions, that are designed around you and your operating environment.

We grow with our customers, by investing in our relationships and strategic partnership approach and consistently delivering the support that keeps them successful.

Metro continue, as always, to keep you updated on the current market conditions and situation and we will always have the latest news and best advice in the global logistics and supply chain environment, which is operating under new parameters in the ‘new normal’ world. Please do call us to arrange a meeting and discuss your own plans for 2022 and beyond and we will ensure that a tailored solution is designed that will ensure your business can continue to grow consistently.

PPE supply chains critical for months

Airline terminal handling and storage pricing strategy wrong

Jan 13, 2022 | ,

Ground handling of air freight cargo is a critical element in the time-sensitive mode, which has a profound impact on the speed and cost of a shipment.

At the end of last year, one of the world’s biggest ground handling organisations and one of the biggest at London Heathrow issued new terminal handling and storage charges, which together constituted a particularly big rise, as the handler also reduced free storage times from 24 hours to 18 while massively increasing costs after 36 hours and 54 hours of dwell in their airline sheds.

Critics say that the storage charges are completely unjustified and that the handler is taking inflation measures to another level, while reducing the free period, in a move that other handlers may follow. This also redefines the model of how charges are levied that has been in place for decades with a tiered system of elevating costs as the time period increases making management of storage costs almost impossible.

From our perspective, the fact that it can take up to five days to get freight out of the airline sheds, due to congestion and airline handling inefficiencies, clearly demonstrates how handlers lack customer-focus in imposing increases of up to 500%.

Handlers have pointed out their huge rise in costs and blame increasing congestion on forwarders failing to pick up freight on time which, in our experience, is almost never the case. Particularly now, when a big shipment left with the airline, will generate five figure charges in just days.

Congestion in the cargo handling operations is much more to do with the sustained demand for air freight that we have seen throughout 2021 and means that handlers need to increase their capacity, with more labour resource and additional truck bays to accommodate the loads and reduce delays.

Other handlers have yet to increase their rates for 2022 and there are big disparities, with some airline’s handlers charging up to £70 a day for storage of 100 kilos, or more than four times those currently reasonably priced, at around £14 per 100 kilos per day.

In addition many airline handling facilities introduced additional costs in the guise of ‘covid surcharges’ in 2020 which had already, by stealth, increased ground handling costs per kilo significantly.

If costs become too prohibitive we will have to ensure that certain handlers are avoided, which means instructing our network partners not to book with airlines that use handling agents that are charging excessively compared with other players in the market. 

This in itself can be an issue as it reduces the airlines that we can use in an already limited and under supplied air cargo environment, due to the lack of passenger flights operating, during the continuing pandemic. This is especially harsh on long-haul routes, many of which are the world’s main manufacturing and consumer markets, such as Asia and the Indian subcontinent. 

A delicate situation needing creativity and consideration, to ensure that we deliver the best value for money to our customers, has just got a lot more complicated.

There is also the danger that excessive charges will have a domino effect, with hauliers adding surcharges, in order to collect pre-6pm and avoid storage costs. This we are already seeing from some transport companies at Heathrow – so to avoid storage charges in certain airline facilities we are having to pay additional transport costs of up to £0.10 per kilo to ensure freight is collected within the ‘free time’ collection window.

However you look at it, costs have been and are continuing to increase for the handling element of export and import air cargo movements, which we are trying to keep at the most competitive levels, as part of our time critical platform and solution to our clients.

Our air freight team continue to find solutions for urgent and time-sensitive shipments, to every destination and from every origin, using a blend of scheduled and dedicated cargo services. 

We work closely with our global network, to continuously monitor market capacity and service opportunities that might benefit our customers.

Evaluating and blocking space on viable services early, is a critical factor in achieving the most demanding deadlines. 

Please call Elliot Carlie for insights and advice on how to move your express time sensitive products globally.

Dover queues

Ports under post-Brexit pressure

Jan 13, 2022 | , , ,

The 1st January 2022 changes to UK border policies, with the imposition of customs declaration for imports from the EU, got off to the rockiest of starts when the new supporting IT system, the Goods Vehicle Movement Service (GVMS), crashed on day one, with trucks stuck at Calais for four days.

While HMRC were quick to restore the crashed GVMS system, the pressure on EU/UK supply chains is likely to intensify as volumes rise after the Christmas lull, with additional delays tied to Goods Movement Reference (GMR) production, which is required before trucks can enter the loading port. Truck drivers have reported queues of up to eight hours trying to get through customs controls at the French port of Calais.

We are uncertain why other forwarders’ GMRs are not being produced in a timely manner and not always correct, as we do not see the new regulations as too arduous. The process is the same, it’s mainly just the time frame which has changed.

Make UK, the industry body representing 20,000 manufacturing firms, said that while optimism among its members had grown, it was being undermined by the after-effects of the UK’s departure from the EU.

One year on from the end of the transition period and the majority of firms in a Make UK/PwC senior executive survey said Brexit had moderately or significantly hampered their business, with over half warning they were likely to suffer further damage this year from customs delays, new red tape and changes to product labelling.

Brexit disruption remains among the biggest concerns facing industry bosses for the year ahead as Britain’s departure from the EU complicates the fallout from COVID-19 and the multitude of rising costs facing companies.

Delays at customs, the additional costs from meeting separate regulatory regimes in the UK and the EU, and reduced access to migrant workers were among top concerns raised in the survey, while on a more positive note three-quarters of companies expected conditions in manufacturing to improve over the coming year.

According to analysis by the Centre for Economics and Business Research, business optimism and output growth fell in December as firms grappled with the fallout from the latest wave of COVID infections.

However, most companies said they believed business conditions would improve, with about 73% believing that opportunities outweighed the risks, while in a separate survey of chief financial officers, a record 37% were planning on increasing capital investment in the next year, on new products, services, or markets.

Metro are at the forefront of delivering unique customs brokerage solutions, designed and developed in-house, with automation and a global team of more than 40 people dedicated to the platform. We can ensure that products move from A to B to Z seamlessly under the correct protocol and with complete visibility.

We believe that importers should have no fear of customs delays, or new red tape hampering their supply chain operations.

Our CuDoS customs brokerage platform automates and submits customs declarations, simplifying compliant UK/EU border processing and safeguarding our customers’ European supply chains.

We have a dedicated team of customs experts who support our customers through easement and regime changes and ensure that their EU/UK movements flow smoothly across the border, in full compliance with all controls.

To discuss your situation and to learn how we automate customs declarations for businesses of all sizes, please contact Elliot Carlile or Andy Fitchett who can talk you through the options. 

We currently have capacity within our brokerage business unit due to further huge investment in 2021, in personnel and our CuDoS platform, which positions us at the forefront of the market. We can deal with any challenges and encourage all new enquiries relating to customs requirements during the current period.

Category: Supply Chain

Coronavirus | Sea | Supply Chain

Latest News in this category