This year has been a very weird year for logistics companies trying to land goods for their clients. The map above shows just how chaotic the entire system is right now with over 250 feeder ships heading to the UK to help the log jam. The problem is the UK crisis is now impacting 3 other ports in Europe as they are overflowing with UK Containers.
There are many things influencing this strange scenario which I haven't seen before or even heard about. I knew things were not going smoothly due to Brexit and certain implications. The UK currently has a lorry driver shortage combined with a world wide container shortage. What this means is the container vessels are fully loaded and are refusing to wait for up to a week to offload. The UK ports are trying to create space for the next ship but without sufficient trucks this takes time. The schedules are that tight as they need to return to the Far East as soon as possible.
Talk about challenging as Felixstowe in the UK is bottle necked which would mean a good two week delay at any port except they don't have many trucks to deliver.
Maersk the Dutch shipping Line is refusing to wait in a queue to offload their containers so the UK destined containers are now going to Rotterdam. From Rotterdam the idea is truckers will deliver the containers to the UK via ferry and then overland transport. The problem is Rotterdam is now overflowing with containers destined for ports in the UK and has started using other ports to dump the containers. Wilhemshaven and Zeebrugge two other ports are also filling up fast and then what? Will it get to the stage where UK destined containers will sit at port in The Far East as they are too big a headache to deliver?
The real issue is the container vessels have no spare capacity as they are already fully booked months in advance. This is where feeder ships are bought in to perform miracles as they also face delays getting into port and honestly it has to be worth their while or they wont do this. Will we hit November and the feeder ships ask for bigger tariffs?
This will only intensify over the coming weeks as this is silly season when the pressure is for retailers to get stock for Christmas. How many of these containers will reach their destination in time is anyone's guess, but the container companies main task is to off load and load up as many empties as possible and fetch the next batch of containers destined for Europe.
This is obviously all being part of the increased shipping tariffs that we are witnessing these days. Someone has to foot the bill for ships travelling back to the East with empty containers. The shipping companies unsurprisingly have decided to forward that cost over to their clients and one of the reasons for the ridiculously inflated prices of between 300 and 400%.
UK ports biggest nightmare with 24 000 containers arrived last month at Felixstowe. There is no getting over that if you don't have trucks on hand as there are more backed up behind it. A fleet of 1000 trucks would take a minimum of 12 days to deliver the containers on board this vessel to their destinations with no hold ups.
No one in their right mind believes shipping costs haven't increased that much but this is about supply and demand. A take it or leave it philosophy with pricing is what we are seeing currently and the UK container prices may increase due to this serious problem.
Funny as when I first heard about the truck driver shortages I never realised that things would get so bad. if you are living in the UK I would advise getting your shopping done early as this is not going to end well. There are just too many containers to truck as have you seen how many containers are on one vessel? A 20 000 Teu vessel is just that and that is not even a big one.