The Impact of Covid on Shipping
According to The International Federation of Freight Forwarders Associations (FIATA), container imbalances are a ‘perennial’ freight forwarding issue most years. As carriers drive towards larger ships, FIATA believes that they drastically confuse container management at terminals. Yet, they’re confident members have the tools and knowledge to overcome these issues.
This year, however, COVID-19-led changes have forced FIATA to warn of a freight forwarding ‘tipping point.’ The Switzerland-based association has even stated that the impact on supply chains could altogether imbalance equipment or the ability to keep cargo moving. And, FIATA fear this could lead to “severe implications on destination backhaul (export) space and equipment, due to the significant shortage of sailings and containers shipped.” What’s more, they predict that the problem can only get worse.
China Rebounds, The World Watches
After all, China’s factories are returning to normal, but importers worldwide still face uncertainties. More pressingly, FIATA warns that these implications won’t be fully felt until the pandemic subsides. Then, attempts to reinvigorate the supply chain could lead to precisely the tipping-point predicted.
The World Customs Organization’s Private Sector Consultative Group has added fuel to this belief. Their statement on April 13th confirmed that restrictions on non-essential goods had already reduced access to vital containers. Industry representatives even warned that ‘If this continues…it could result in a halt in all container trade due to non-availability of empty containers.’
Fear In Freight Forwarding
This is a significant freight forwarding threat. It’s an especially worrying forecast after untold periods of lost revenue. Understandably, companies want to get back up to full service fast rather than continuing to struggle. Luckily, FIATA believe it’s not all doom and gloom.
Director General, Stephanie Graber, reminds forwarders that they already have the knowledge they need to settle those scales. She claims that it’s down to them to help shippers and carriers regardless of COVID-19 bottlenecks.
What’s more, FIATA is taking steps to make sure that happens. Most notably, it is ‘…enhancing its service to all members to…support the reconstruction of trade.’ This and more is outlined in a recently released paper that researches the role of freight forwarders in recovery.
Freight Forwarding Needs to Move Forward
Most notably, the document outlines primary freight forwarding priorities to keep cargo moving. The principal message here is that keeping freight in containers is expensive. Thus, FIATA is working to reduce demurrage and detention rates for extended unloading.
The association is also urging forwarders to use experience and IT to keep refrigerated containers moving quickly. This is an especially pressing priority given that most terminals have limited reefer plugs. And, they hope this will keep traffic clear at all times.
FIATA is the first to admit that COVID-19 will have lasting impact on freight forwarding. It’s even putting steps in place to address abandoned cargos as a result. But, with everyone using the tools at their disposal, the association is sure there’s a way through. In fact, if forwarders across the industry took notice, unloading post-COVID-19 could be easier than ever. And, that’s sure to get the industry back up and running with minimal setbacks.