Hello, it’s IINO.
I would like to broadcast IINO san’s Logistics Radio.
Today, I would like to talk about, “International logistics disrupted, congestion at European ports worsens. Uncertainty in many parts of the world.”
Daily Logistics Radio by IINO san in 22nd June 2022
Congestion Worsening in Northern Europe
The outlook for international logistics is becoming increasingly uncertain.
In addition to growing concerns about worsening congestion at North American West Coast ports, where labor negotiations are still ongoing, congestion is now worsening at hub ports in the northern European states, which are also facing port strikes.
As I reported on the radio on May 31, clogging at European ports was caused by labor shortages.
Asian Hub Ports also Affected
Congestion at hub ports and container shortages in exporting countries are continuing in Asia.
On June 17, the Ministry of Land, Infrastructure, Transport and Tourism held a public-private information sharing meeting on international logistics.
At the meeting, Maersk and representatives of JIFFA, Japan International Freight Forwarders Association, stated that “European ports are overflowing with containers and delays are occurring in both outbound and inbound voyages.”
Adherence to schedules on European routes appears to have dropped significantly and the number of voyage days has increased.
This is due to stricter cargo inspections by EU and UK customs authorities as a result of economic sanctions against Russia, as well as congestion at transshipment ports in Singapore and other Asian ports.
The congestion in Singapore was also occurring at the Corona pandemic, and together with the port of Kuala Lumpur in Malaysia, there was tremendous congestion.
I speculate whether cargo is being held up in Singapore, the transit port, because of the clogging that has been occurring in Europe.
Many Strikes Occur in Northern Europe
On the land side of Europe, warehouse space is under pressure due to the backlog of cargoes bound for Russia whose transportation has been suspended, and furthermore, there is a shortage of drivers due to the return of Ukrainian drivers.
Not only that, but according to shipping company sources, on June 20, labor unions went on a 24-hour strike at the Belgian port of Antwerp-Bruges, following strikes at Hamburg and other German ports the week before last.
In the UK, a total of three days of rail strikes are planned for this week, and labor-management tensions are rising in Europe against a backdrop of inflation and other factors.
In Europe, the Eurozone consumer price index rose 8.1% year-on-year in May, reaching a new record high.
As a result, the ECB, European Central Bank, is moving to raise interest rates by 0.25% in July.
China’s Zero Corona Policy
China’s rise from the Shanghai lockdown has been relatively slow, with limited offshore waiting and priority is now being given to processing backlogged import cargo.
However, due to quarantine measures, there continues to be a shortage of drivers and other manpower, and trucks are being fought over.
Due to the government’s zero-corona policy, sudden blockades of districts are also occurring.
Many Factors Contributing to Logistics Congestion
In the midst of all this chaos, there are fears that shipments from China could spike depending on demand on the Western side, causing a 2020-like disruption.
This article gives the impression that there are many strikes.
Recently in South Korea, there was a nationwide strike of truck drivers that lasted 8 days and affected the country, with factories shutting down.
Inflation in Europe and the U.S., labor shortages, the impact of the situation in Russia and Ukraine, high demand in North America, labor negotiations at West Coast ports, and China’s zero-corona policy have had a number of impacts on logistics.
Currently, space is easy to get, not as congested as last year, but what will happen in July and beyond?
I think there are enough factors to cause another clogging.
I will continue to update this information.
That’s all for today. Thank you.