International Forwarding Association Blog »
The past couple of years have brought a lot of uncertainty, supply chain disruptions, and volatility around the globe. Capacity management issues, along with attempts to hedge against freight rate decreases pushed prices up at a time when consumer demand skyrocketed mid-2020. Two and a half years into the Covid-19 pandemic, freight rates are slowly stabilizing, albeit on some routes the rates are still 400 percent higher than in 2019. Ocean Freight Rates Global ocean rates dropped 6 percent, mainly due to freight decreases on European, US West Coast, and ex-Asia routes. Asia – US West coast rates… Read more
There are different ways in which manufacturers and suppliers can suffer from cargo damage during transit. First, damaged items are typically returned for replacement or full refund which not only incurs additional costs but can have a negative impact on both the carrier’s and the seller’s reputation. Second, the components, parts, and equipment that are damaged often result in wasted time. This is why, carriers need to ensure that tools, equipment, and other cargo are protected from damage, taking into account factors such as handling, humidity, temperature, contamination, vibration, impact, and static charges. Physical Damage Physical damage occurs… Read more
The shipping industry needs to reduce carbon emissions so that temperature increases are kept below 1.5 °C. Using alternative fuels can help reduce pollution and keep temperatures below the threshold. This means halving carbon emissions by 2030 and achieving zero emission targets by 2050. At present, the shipping industry accounts for about 3 percent of carbon emissions globally. If it were a state, this would make it the world’s sixth biggest polluting country. So, if we are aiming to reach emission targets over the next decades, carriers need to adopt greener fuels produced from renewable sources. There are several alternatives… Read more
Value chains and container shipping are faced with major disruptions while many countries are looking for alternative supplies of grain, gas, and oil. According to UNCTAD, the Ukraine – Russia conflict has put a significant strain on the Black Sea region and logistics and trade in Ukraine, raising shipping costs globally and increasing demand for ships. A recent report by UNCTAD notes that the country’s trading partners have been forced to turn to other regions for imported commodities. The report concludes that the conflict has exacerbated other challenges such as port congestions and the prolonged Covid-19 pandemic. Reasons… Read more
Apart from the Suez Canal blockage in March, 2021, many big commercial vessels shipping cargo were stranded outside ports last year, from South Carolina to Europe and Singapore. Why all this happened? Covid-19 Pandemic When lockdowns and travel restrictions were imposed in 2020, many started ordering gym equipment and office furniture, setting up work from home and turning their basements into gyms. There has been a surge in orders globally. Not surprisingly, this translated into a 48 percent increase in retail purchases while online sales increased by 24 percent. Yet, the bulk of this trade (90 percent) is… Read more
Only 35 percent of the major carriers are set to achieve net zero emissions or have committed to the targets of 50 percent set by the International Maritime Organization. A new study by the Center for Zero Carbon Shipping looks at the actions and ambitions of the biggest carriers by capacity in car/RORO, container, bulk, and tanker segments. The latter account for the majority of maritime emissions (70 percent). Shipping Industry Share of Carbon Emissions With a fleet of about 100,000 ships, the industry consumes some 300 metric tons per year, translating into 2.5 – 3 percent of global… Read more
Shortage of expert workforce, environmental regulations, demand and supply imbalances, and supply chain bottlenecks are some of the main challenges facing the shipping industry. Emerging innovations and trends help reduce the negative impact on carriers and forwarders. Blockchain, robotics and automation, the Internet of Things, big data and analytics, and artificial intelligence are successfully integrated in different segments to improve safety and efficiency. Also, cybersecurity and 5G, mixed reality, and augmented and virtual reality are paired up with data-sensitive technologies to minimize safety risks and ensure continuous operations and robust functioning. Maritime Operations AI There are numerous applications for… Read more
Major shipping lines announced they would be no longer shipping scrap plastic from developed countries to Southeast Asia and China. Until 1992, China used to be #1 destination for plastic imports, which would be recycled and used for manufacturing. When the country’s economy expanded, its scrap output also increased. Currently China has more than enough waste plastic for recycling and no longer needs imported waste. Limiting Imports of Scrap Plastic In 2017, China announced a policy called Operation National Sword, effectively limiting the import of plastic waste. Developed nations rerouted their waste exports to Indonesia, Malaysia, and other nations in… Read more
The crew change crisis seem to have stabilized despite a shortage of Ukrainian and Russian mariners and the restrictions imposed in Japan. Figures show that the number of crews stranded onboard ships beyond contract expiry is down to 4.3 percent in June, compared to 4.5 percent in May, 2022. The number of mariners onboard ships for 11 months or longer has remained steady at 0.3 percent. According to ship managers, there are both negative and positive crew change trends. Positive Trends The number of confirmed cases onboard ships has declined while China is easing restrictions on crew changes, which have… Read more
The main types of cargo include livestock, foodstuff, liquid and dry bulk cargo, machinery and equipment, vehicles, and crude oil. Depending on type, a different mode of transportation and vessel is used. When choosing how to ship commodities, carriers take different risks and hazards into account, including fungal and bacterial growth, spoilage of foodstuff, fire, and volatile behavior. Foodstuff This category includes a variety of items that may or may not require refrigeration transport, including partially processed, fresh, frozen, and packaged goods. As a rule, foodstuff is challenging to ship due to the short shell life of goods and the… Read more
Recent Covid-19 outbreaks and the sanctions against Russia are causing crew shortages and pushing wages up. Outbreaks in the Far East have prevented Chinese seafarers from boarding ships while Russian crews are unable to join ships due to travel limitations and visa restrictions. This has resulted in reduced availability on a global scale and a serious manning and recruitment crisis. Wage increases can be seen across all ship types and ranks and for some ranks, remuneration increases are quite steep. Causes for Crew Shortages In addition to new Covid-19 outbreaks and the sanctions against Russia, favorable charter markets across… Read more
The war in Ukraine has caused a serious supply chain disruption which is likely to exacerbate the crew crisis, port congestion, and supply chain disruption caused by the prolonged pandemic. International freight forwarding has been hard hit, with the burden of sanctions, the disruption of trade with Ukraine and Russia, and the loss of vessels and life in high-risk areas in the Black Sea. Carriers face multiple challenges such as cyber risk, availability and cost of fuel, and crews stranded in Ukraine waters. Implications for Global Trade According to the International Monetary Fund, the ongoing conflict is likely to… Read more
Since the early days of the conflict, Ukraine’s ports have remained blocked due to Russian ships and mines. There are 80 ships currently stranded, some carrying cargo, others – empty, with crews having fled from Ukraine. The country’s biggest port, the port of Yuzhne has been idle for the last three months, with thousands of workers staying home. How Could Shipping Be Restored? Boosting Rail and Road Capacity Earlier in May, the European Commission announced plans to boost rail and road capacity and unblock Ukrainian borders so that grain can be shipped. Yet, bottlenecks still remain, and mainly the… Read more
Illicit shipping practices are often used by countries that seek to evade economic sanctions. Such practices include flag hopping and false flags, voyage irregularities, altering vessel identification, manipulating or disabling vessel automatic system identification, and falsifying ship-to-ship transfers and vessel and cargo documents, among others. Flag Hopping and False Flags A false flag operation is where a carrier pretends that a ship is sailing under a flag state without the knowledge, permission, or consent of that state. Flap hopping, on the other hand, involves changing the flag state of a ship with the goal of avoiding identification by the… Read more
The liquid and dry bulk markets will be affected this year due to the ongoing conflict in Ukraine and the supply chain disruptions that are expected to continue through 2022. Experts predict trade growth to be 1 – 2 percent based on type of cargo. While trade growth has lost momentum due to the war, there are mitigating factors such as route changes and cargo flows being redirected. To what extent carriers will be impacted depends on contracting and specific markets. Types of Cargo Most Affected According to analysts, coal is the main dry bulk flow that is expected… Read more
International shipping offers businesses the chance to enter new markets and reach more customers. However, it is important to understand the regulations and procedures for importing and exporting, and it is equally important to secure the right shipping documents. You should be prepared to provide details about your business, shipment, country of origin and destination, and the reasons for shipping. In some cases, you will also need to obtain permits and proper licensing for your shipment. There is a wide variety of documents that you might need to present to comply with legal requirements and import and export regulations. Some… Read more
Lockdowns in various Chinese cities have increased pressure on logistics and transport, as Covid-19 cases continue to rise across the country. The trucking industry has been hard hit, which plays a key role in shipping cargo to major ports in China. There are also restrictions on deliveries and truck drivers moving goods to areas with a high Covid-19 count. Domestic Impact According to domestic freight forwarders, trucking is the main problem at present. Booking truck services has proven extremely challenging and even impossible at times. Also, flight activity has shrunk to 3 percent from what it was in March,… Read more
Oversized loads cover a wide range of freight that differs in terms of dimensions, weight, and technical characteristics. Shipping of heavyweight items is more challenging than transporting standard-sized cargo due to their dimensions and the fact they are subject to special regulations. There are many things to account for, from freight specifics and optimal delivery route to challenges and problems with transport. Types of Oversized Loads There is a variety of freight types that are categorized as oversized cargo, including industrial machinery such as large engines, bulldozers, and cranes and vehicles such as trucks and cars. Steel structures and beams… Read more
Covid-19 is not over yet, with China reporting the worst outbreak since the onset of the pandemic. The third most populous city, Shenzhen was placed on lockdown this Sunday, and factories closed temporarily. Shanghai has also experienced a surge in cases, and new restrictions have been imposed. Shenzhen is the home to the world’s third largest port while Shanghai is home the world’s largest. The extent to which the trans-Pacific route will be affected depends on how long factories and ports will be closed. According to experts, the worst-case scenario would be a major shockwave putting pressure on already strained… Read more
There is a variety of ways to manage the flow of goods and ship cargo from place of origin to a distribution center or point of consumption. The choice of shipping method depends on the type, dimensions, and requirements of cargo to be moved, whether supplies, equipment, raw materials, and goods. Shipping is a complex process that involves a number of steps, from packaging and loading, to shipping, warehousing, and securely managing data. Historically, European logistics providers used one mode of transportation, be it shipping containers by sea or moving goods by trucks. With time, the demand for intermodal freight… Read more
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