The Impact Of The Suez Canal Blockage
While this month’s Suez Canal blockage was obviously going to lead to some service disruption, it seems the knock-on effects have been far reaching and we are currently experiencing precarious market conditions.
As expected, carriers across all alliances are cancelling schedules from China to Europe, the UK & Ireland – due to vessels being out of position. Blanked sailings will reduce weekly capacity by between 7% and 26% in each of the next 9/10 weeks.
Additionally, the availability of container equipment, hampered by global port congestion and now delays on Suez affected vessels, has become critical in many origin areas.
This is, and will be, seriously restricting the number of containers able to move -particularly in April and early May. We are already experiencing delays in availability of space or equipment (or both) from Northern and Southern China and South East Asia.
The disruption in services and equipment almost certainly means that increases in rates for Asia/European routes are to be expected from mid-April. This may be via a General Rate Increase (GRI) or a reinstated Peak Season Surcharge (PSS).
In the coming days, we are also going to see disruption of services to all major ports in Europe, as vessels held up in the Suez Canal have started to arrive. Some ports, including some in the UK, may be omitted, with containers being off-loaded elsewhere and then transhipped to final destination. This will ultimately cause further delays.
Our UK and Irish regional teams will be doing all we can to mitigate these issues and will keep you informed of developments. However, limited schedules, limited equipment and heightened European port congestion does mean extremely challenging market conditions are upon us.
If you require further information regarding the above, then please do not hesitate to contact a member of our team .
