Coronavirus International Shipping Europe Update
Coronavirus International Shipping
To read full story on the China situation, click here.
Our local German partner, Alfons Koester, updated us on the shipping status in Europe due the Coronavirus in China.
The “coronavirus epidemic” has caused a full shutdown of activity in China, affecting supply chains around the world. Due to the extremely high risks of coronavirus exposure, Chinese factories, sea ports, airports, and transportation have been shut down. As a result, importers and exporters of Chinese goods are seeing significant delays.
Much like the United States, Europe is also facing a large amount of blank sailings. The blank sailing, otherwise known as void or cancelled sailings, are managed by the carriers. Blank sailings are posted, but are subject to change. In fact, just recently, carriers decided to implement a longer period of blank sailings.
For example, normally one specific location for a major carrier in Germany contains around 20,000 containers per week for China services. This service has decreased to 2,000 per week for all of Germany. These 2,000 export containers are mainly reserved for carrier direct accounts related to the automotive and chemical industry. In return, this means the carrier will only receive in return around 2,000 boxes per week that can be turned around for exports. The same scenario exists with all other global carriers like CMA, MSC, Maersk, Hapag, Cosco China, etc, with one exception of ICL and ACL. Fortunately, Scarbrough and Alfons have a close relationship with carriers ICL and ACL, which only operate on the transatlantic trade.
Jan Hansen with Scarbrough’s partner, Alfons Koester, states, “As you can imagine, we Europeans and especially Germany are in need for incoming container flow because otherwise there will be no equipment for exports.” As a result, Alfons Koester founded a task force team to conquer this problem by acquiring as much equipment protection from the carriers (Hapag Lloyd, Evergreen, OOCL & CMA CGM ) as possible.
To underline how tight the situation looks like, Alfons is the only freight forwarder in Hamburg, Germany to secure a minimum quantity per sailing on Evergreen moving to the far east, for example.
Pork Exports to China Cause Reefer Shortage in Europe
Furthermore, Jan Hansen gives us an update on the reefer situation in Europe, in which he states, “Due to an unforeseen circumstances, the Danish meat producers decided in the last quarter of 2019 to slaughter all of their pigs (there is a pig virus in Poland and Denmark had the fear that this virus will affect Denmark). Now you can think a minute which country bought all the meat – correct, it is China! So there was a really large amount of reefer shipments from Europe to China in the end of last year and beginning of this year. The carriers have since indicated that approximately 100,000 reefer containers are stuck in China and the Ports of China!”
What to Expect
Scarbrough and Alfons are in an advantageous position with the carrier Evergreen and are first in line for empty equipment, but this won’t last long as the containers continue to flow out and not come back in. As our Chinese partners indicate, factories in China should be back to normal in March sometime. At a minimum, it will take at least one month to bring the container flow back to normal. However, it is really hard to forecast. There is a significant change the container flow will not resume back to normal until early summer.
What to do
Please try to understand that in this situation, transit times and delays cannot be controlled. As stated before, some of Scarbrough’s local partners have mentioned this epidemic is one of the worst they have seen in their lives. Scarbrough will continue to monitor the situation, while keeping our partners and friends located in China in our thoughts. Scarbrough will send updates on your cargo if it is significantly affected. If you have any specific questions, please contact your direct customer service representative.
The Scarbrough Group of Companies, headquartered in Kansas City with local presence in every major port in the world, is a complete international and domestic supply chain service provider, offering U.S., Mexican, and Canadian Customs brokerage, Import & Export Transportation Solutions, Domestic brokerage and asset-based trucking, Warehouse fulfillment and distribution services, Trade Compliance Consulting, Large Equipment and Project Cargo moves, as well as Parcel Audit Savings. Scarbrough is widely known for its trade experts, training, personalized customer service, customized solutions, and data analytics tools. Since 1984, Scarbrough has continued to satisfy its clients by following its motto on a daily basis: “It is our job to make your job easier.” Moreover, our team of experts is available at your disposal. We offer free consultations on any topic from supply chain optimization and duty savings opportunities to the basics, helping to guide new importers and exporters as they jump into the world of global trade. Contact us now.
Supply Chain Consulting
Oops! We could not locate your form.