Over one year on, how is COVID-19 impacting shipping?

COVID, the virus that has changed the world we live in without boundaries. The virus that has brought the world to a standstill, travelling and the related industries such as hotels and restaurants to their knees, and we cannot omit the workers in these industries.

The virus did not only negatively hit the touristic sector, but also the surrounding companies and industries, as the correlation between companies are impressive. It is quite simple, without consumption the retailer will not sell its products, factories will not receive new orders, removing the need to order raw materials and so the end result is less availability and higher pricing.

The logistics chain was hit from every corner as the transport of raw materials to factories is reduced significantly vis-a-vis the final products shipped and available to the end consumer. It is simply said, however it is a very complicated matter when you start dissecting and cross-examining the issues and difficulties.

We cannot fail to mention Malta’s maritime sector which received a hard blow. Services offered to incoming vessels were not possible any further due to health requirements and regulations. The impact was devastating for all the industries concerned by such services.

Our island’s strategic position makes it well-placed for ships transiting through the Sicily – Malta straight thus enabling Maltese companies to offer ad hoc services to passing by vessels.

On the other hand, we see shipping lines operating within their maximum capacity, vessels waiting for days at call ports to discharge and load hundreds if not thousands of TEUS full of precious cargo.  All these delays are resulting in less TEUS available for the shipper. The lack of equipment is a worldwide problem and on the increase.

We are seeing the high lack of equipment in various countries, such as Turkey which is a low import country, however a huge exporter. The imbalance is clear and has been ongoing for years, however, now it has hit the point where it is very difficult to reserve a unit for our esteemed clientele, attributed to such lack of boxes.

We cannot omit countries such as China and India, to name a few of the biggest exporters of any manufactured goods in the world. The lack of equipment is resulting in a swift escalation of demand and where there is demand for a product or service this will generally signify that the rates will automatically escalate. It is a demand-driven market. Such rates have increased to the extent where buyers of products are reluctant to pay. Why? Because such pricing of the products being imported will inflate the cost that it would not be economically viable to purchase, ship and sell to the end-user.

These are all adversities that Freight Forwarders are facing day in day out. Clients’ demands are ever-increasing and price satisfaction is hard to obtain. The role of the freight forwarder such as Global Freight Solutions Ltd (GFS) is to do all the shopping around by asking it’s foreign agents for the rates and also through the shipping lines directly, or operators, in order to ensure that the client’s price satisfaction and service relation is fulfilled to the maximum.

The freight forwarder’s role is to save the client’s time by performing market research, offer the right options, alternatives and be available to discuss new opportunities with his clientele. 

The role of the forwarder is to help his clientele focus on his modo d’ operandi, by offering a one-stop shop where it is handled professionally from supplier’s warehouse/factory /depot up to delivery to his/her warehouse through continuation and sustainability according to their tailor-made requirements.