Key Ports Update
The earthquake that sadly hit Turkey and Syria at the start of February saw operations stop at the Port of Iskenderun until further notice. However, as the situation has improved recently, the first trial call Iskenderun is expected on 13 April with Maersk Durban. We expect to have regular weekly calls with mobile cranes and limited productivity at first, and we will evaluate the continuation of services based on the outcome of trials. While acceptance to and from Iskenderun remains closed for now, this will be re-evaluated after trials in May. Read the latest updates on the situation here.
In France, nationwide strikes impacted our services during March and April. Our teams worked hard on maintaining the flow of customer cargo and are offering relief packages to further minimise the impact on our customers’ supply chains. To find out more, head to our advisory page.
During the Easter holidays at the beginning of the month, we have seen closures and limited labour availability across ports in North Europe. Our teams have worked on reviewing vessel schedules – advancing or delaying vessels to ensure cargo arrives before port closure or immediately after reopening.
All ports are now operating as usual and we don’t expect significant vessel impact or delays to customer cargo as a consequence of closures.
Maersk remains the most reliable carrier across trades, as per the latest Sea Intelligence report. Better dwell management and improved vessel arrival into the hubs have driven positive customer outcomes, and our teams continue to implement improvements in the network to further increase reliability. To help maintain operational efficiency of terminals, we kindly ask customers to please collect longstanding units.
To receive the latest updates on your cargo, sign up for ETA notifications here.
Ocean Update
Global supply chain pressures decreased again in March, falling from 0.28 to 1.06 standard deviations below the index’s historical average, as reported by Global Supply Chain Pressure Index (GSCPI). Many factors contributed to the decline, the largest being European area delivery times, European area backlogs and Taiwanese purchases. The GSCPI’s recent movements suggest that global supply chain conditions have largely normalised after experiencing temporary setbacks around the turn of the year.
According to a JLL survey, 22% of logistics service providers expect to see demand improving, while manufacturers and retailers take a more optimistic approach with 42% forecasting growth.
In this changing landscape, supply chain managers are faced with increasingly challenging decision-making that needs to consider the heightened geopolitical risk, trade sanctions, high inflation, tight labour markets, energy crises, high financing costs and weakening consumption. Consequently, adjustments to transportation networks, warehouse locations, building characteristics and energy usage are necessary to manage rising costs. Maersk can support businesses in getting this balancing act right and planning your supply chain to cope with uncertainties.
To tackle the changing macroeconomic factors and their effect on supply chains, in addition to visibility, customers can implement different flexibility solutions to help balance their supply and demand.
Find out how Maersk approaches our customers’ need for flexibility here.
Air Freight Update
Inflation, lower consumption and high inventories continue to influence the market, although the volume decline slowed down and global air freight continued to normalise in March. Capacity outside Europe is slightly up compared to the same period last year, in part due to Covid-19 restrictions easing in China, with routes between the Middle East and South Asia / Asia-Pacific seeing significant increases of 13% eastbound and 5% westbound.
There was a mix of stable and declining rates in March compared to February, while rates were slightly reduced in some origin countries due to lower pressure on the supply chain. China saw stable or even rising rates in March despite rising capacity, partly due to increased demand.
Jet fuel prices continue to be uncharacteristically off sync with crude oil trends. Among others, reasons are ongoing embargoes on Russian imports as a result of the Ukraine conflict and rising demand for jet fuel in China. The price development therefore remains volatile, at the current average price of $2.8 per gallon, according to IATA.
Meanwhile, strikes in several European countries continue to have an impact on the market. In France, strikes by the French air traffic controllers' union led to numerous cancellations and delays, while strike action in Germany led to flight cancellations at Frankfurt and Munich, also had an impact on air freight. We will monitor all industry action across Europe and keep customers informed of any impact to their supply chain.
Maersk Air Freight will continue to expand its services and connections to offer reliable and flexible solutions. Last month, Maersk launched a new air freight service with scheduled flights between Billund, Denmark (BLL) and Hangzhou, China (HGH). To find out about the customer benefits of the Billund hub and the new Asia-European service, click here.
For more information on our air network and own-controlled flights, click here.
Inland Update
When it comes to intermodality of inland transportation, the key is making use of the relative strengths of transport modes – while road transport offers speed and flexibility, rail and inland waterways offer a lower environmental impact and can ease the pressure of congested roads. Currently, the transport sector accounts for almost a quarter of greenhouse gas emissions in Europe, with nearly three quarters being due to road transport (EIWTP). Combined with the shortage of truck drivers in Europe, businesses should re-evaluate their inland and intermodal options to ensure better flexibility of supply chains and further support their sustainability targets.
In March, inland operations were impacted by strike actions in several countries. In France, a national strike action continues to pose challenges to operations, and our teams continue to work hard on minimising the impact on customers’ supply chains. To see the relief packages currently offered to customers, head to our advisory page. In Germany, transport workers’ strike action has caused a ripple effect on our operations that extended to the beginning of April. Our teams continue to closely monitor the situation and will provide an update to customers as soon as new information is available.
In Czech Republic and Slovakia, a change in customs clearance for import shipments for all cargo on trains arriving from Bremerhaven is currently in place.
To ensure your supply chain continues to move with ease, check the advisory page for the new requirements on delivery orders to Czech Republic and Slovakia.
E-Commerce Update
For consumers, last-mile delivery is often the most memorable and important part of their online shopping experience, while for ecommerce businesses it is often the most complex and expensive part. According to AQPC, businesses are putting an increased emphasis on visibility of last-mile delivery to meet consumers’ expectations. For almost one quarter of respondents, however, this visibility is only present to a small extent.
Visibility in last-mile delivery includes everything from order confirmation, processing updates, tracking codes and delivery estimates. Thanks to marketplaces that focus on technology, consumers are used to a seamless experience and regular updates on their order, regardless of where their parcel is coming from. Smaller businesses, especially those that ship cross-border, sometimes lack the level of technology and integration in their platforms, making it more difficult to ensure complete visibility and a seamless experience for their consumers. These businesses are now looking for digital assistance that would help them connect the dots across first, middle and last mile, as well as different suppliers to reduce their cost and at the same time ensure a better consumer experience.
To create strategic partnerships for E-Commerce growth with our customers, Maersk teams are preparing for DELIVER 2023. Book a meeting with our team at booth D10 to find out how Maersk solutions can help elevate omnichannel experience for your customers.
To learn more about our integrated solution for your parcel supply chain across Europe, head to the E-Delivery portal here.
Customs Update
In the last quarter of 2022, global trade saw a decline and is expected to remain stagnant in Q1 2023, before turning more positive in the year's second half (UNCTAD). Although manufacturing trade decreased, trade in eco-friendly goods rose in the second half of 2022, indicating international trade patterns are increasingly aligning with the shift towards a more environmentally sustainable global economy. While the outlook for global trade remains somewhat uncertain, positive factors such as an improved outlook of major economies, decrease in shipping costs, and an increased demand for services are expected to compensate for the negative trends.
Other factors, such as near-shoring, moving production closer to the market, and re-shoring, moving production back to the home country, continue to affect the global trade patterns and reshape global supply chains. These trends may lead to more regional trade and working with local suppliers, reducing long-distance transportation, and benefiting the environment.
At the end of March, the UK has concluded negotiations to join CPTPP (Comprehensive and Progressive Agreement for Trans-Pacific Partnership). Once the partnership is ratified, 99% of all imported and exported products, including whisky, cars, and chocolate, will be subject to zero tariffs, supporting UK businesses trading with CPTPP parties.
Countries currently in the agreement are Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, and Vietnam.
As world trade patterns change rapidly, customs handling must keep up. By conducting regular checks on commodity codes, customers can ensure they stay compliant and avoid unnecessary costs as incorrect codes can result in excessive or insufficient payments of VAT or customs duties, legal fines, penalties and even goods being delayed or seized by customs. Monitoring codes enables optimising customs duties and taking advantage of free trade agreements, while also keeping track of regulated markets with anti-dumping fees. Learn more about what to keep track of here.
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