International Forwarding Association Blog »
In the midst of the Covid-19 pandemic, sea freight in Europe faced a shortage of containers. Today we’re having the opposite problem: an excess of containers. In addition to declining rates, depots are either full or are quickly filling up, with some operating at 99 to 100 percent capacity. This trend is associated with a decline in global demand, combined with an impending recession. The fact that many operators bought new containers for one-way sailings is only aggravating the situation further. Why Are Depots Facing Excess Depot managers point to the fact that container volume has skyrocketed to the… Read more
A recent survey by Deloitte reveals that 59 percent of shipping companies are in the process of acquiring new core capabilities, while a similar share (60 percent) of carriers are looking to outsource their non-core capabilities. According to the study, these processes could complement each other, with shippers outsourcing support functions while building or expanding their core capabilities. Core Functions Core capabilities include processes such as order fulfilment, warehouse management, transportation scheduling, safety, workforce and demand planning, and portfolio planning. Currently, the majority of shippers are looking to add new capabilities so that their services and operations align with… Read more
When people think of warehouses, the image of a dark, cold, and dusty place usually comes to mind. Yet, today’s facilities are modern, clean, and full of light. They keep goods safe, meet urgent demand, and keep the economy moving. Here are 4 types of warehouses and the functions they serve. Cold Storage Cold storage warehouses are used to keep temperature-sensitive and perishable goods at a specific temperature. They enable cosmetics, artwork, medicines, plants, and foods to have longer lives and maintain their quality and integrity. The types of items that require cold storage include: Aircraft components Hides, wool,… Read more
Regardless of the sector you operate in, delivering your products to clients safely, in good condition, and on time is key to your reputation and bottom line. Yet, with a range of equipment and modes to consider, choosing the best option is not always easy. From power-only, refrigerated, and dry vans to straight trucks and cargo vans, here is a quick guide to help you decide on the type of equipment you may need. Refrigerated Trailers This piece of equipment is used for refrigeration transport of perishable goods like pharmaceuticals, dairy, and fresh produce. Refrigerated trailers or reefers are… Read more
Artificial intelligence can provide forwarders with an opportunity to enhance their decision-making capacity. Data transmitted by commercial vessels, for example, can be used for predictive guidance and performance monitoring, enabling businesses to forecast greenhouse gas emissions. This is a way to lower emission levels and ensure carbon transparency. Other implementations include automated processes, improved scheduling, real-time analytics, and so on. To leverage AI, however, international freight forwarders should take multiple factors into consideration, including the legal framework guiding artificial intelligence. One particular challenge to implementation, especially for shippers operating in both EU member states and the UK is… Read more
There is a significant decline in consumer demand, with logistics CEOs noting a 20 percent decrease in ocean freight orders for the last two months. The pullback is evident across a wide range of products, ranging from some types of apparel to industrial, housing, and machinery. The main reasons for the drop in orders are lack of clarity on demand, combined with excessive inventory. CEOs share the opinion that the number of waiting cargo ships is expected to drop. Outbound tender rejections are also signaling a decline in orders. Inventory Issues Demand for expensive items is still strong,… Read more
If you are specializing in freight management and logistics, chances are you are faced with all kinds of expenses associated with storing and moving cargo, including fuel, warehousing, insurance, and labor costs. With inflation and ever-increasing prices, international freight forwarders are forced to optimize supply chain procedures to reduce costs. While improving your bottom line may look like a challenging task, here are some costs to account for and some tips on how to keep expenses down to grow your business. Shipping Costs to Account for Shipping costs are paid to a range of businesses, including freight brokers,… Read more
Green corridors are routes that are exclusively used by ships running on alternative fuels. Recently, their feasibility has been widely debated by industry players. Most agree that green corridors can help de-carbonize the shipping industry but there are still some uncertainties about implementing them. But first comes first – what are green corridors and what are the different types that industry players can use? The Logic behind Green Corridors Broadly speaking, green corridors are specific routes that make zero- and low-emission shipping more feasible. They correspond to economic zones where industry players can implement new business models and… Read more
Logistics can be divided into a number of branches, each with its functions and specifics. The main branches are production, procurement, sales, and recovery logistics. These functional areas cover a wide range of activities such as packaging, transportation, inventory control, storage and distribution, materials handling, and order processing, to name a few. Production Logistics Production logistics involves a wide range of processes, among which the execution, control, and planning of storage and transport for finished, semi-finished, spare, and purchased parts as well as operating, auxiliary, and raw materials. The goal is to ensure an efficient and smooth flow… Read more
There is nothing worse than inspecting your freight only to find concealed damage. It will not only incur significant financial losses but can hurt your reputation, customer relationships, and company growth. Knowing some of the common situations that cause freight damage is your best weapon so that you are able to properly inspect cargo upon arrival. If you are on the shipping side, there are some preventive measures to take protect and ship cargo safely. How Does Cargo Get Damaged? Some damages are unforeseen while others can be prevented by proper handling. Common reasons for freight damage include:… Read more
Ocean carriers are increasingly offering air cargo services as customers are looking for an intermodal logistics solution to ship freight around the globe. According to experts, it is more than just simplifying logistics but also about making it effective, efficient, and optimized. Some of the largest shipping companies have already added aircraft to their fleet while others have opened an air cargo division. This is because global supply chain disruptions have created a demand for cargo to be flown. Why Customers Choose Air Freight In the majority of cases, air is only part of the solution. Some customers… Read more
A shipper is a business that receives, oversees, and transports cargo on behalf of other businesses. The company can choose to ship goods by sea, rail, or road based on type of cargo, final destination, optimal route, and budget. The forwarder is also tasked with unloading and loading of cargo, inspecting quantity and quality, checking inventory receipts, and more. If you are interested in becoming a freight forwarder, you need to master some essential skills, identify your career goals, and learn how to manage contracts and international freight services. Essential Skills to Master To become a shipper, you… Read more
The drive towards sustainability is transforming the shipping industry. Innovative business models, next-generation technology, and changing regulations will have a profound effect on both carriers and forwarders. Business as usual is no longer acceptable because societies and consumers are increasingly aware of the importance of sustainable practices. Today, consumers demand more transparency and new policies aimed at reducing the impact of pollution on nature and human health. Changing Focus and Landscape Changing trading patterns and regulations, together with a growing focus on decarbonization and climate change are set to transform the shipping industry in the years to come…. Read more
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
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