Ocean and Key Ports Update
With winter contingencies now behind us and spring weather in full swing, operations across European ports are running smoothly. Across North Europe ports, we are not seeing significant space constraints, allowing us to react to and deal with unexpected disruptions. In Mediterranean and Adriatic ports, yard density and productivity drops remain a concern. To help alleviate the pressure, we kindly ask customers to please pick up import containers as soon as possible after discharge.
The situation at the Port of Iskenderun, which has been closed following the earthquake that sadly hit Turkey and Syria at the beginning of February, is slowly improving. Following a positive result of trials in April, Maersk will continue making weekly calls to the port, while closely monitoring the performance and making adjustments if needed. At the Port of Mersin, waiting times and yard density levels are increasing, causing delays to schedules and customers’ cargo. To help improve the situation, we strongly urge you to clear your cargo from the terminal as soon as possible after discharge.
In France, the series of strikes that started earlier this year remain ongoing. As the situation surrounding the strike action is still subject to change, our teams continue monitoring the situation and will provide an update as more information becomes available.
In preparation for the summer period and any potential reduction in labour at ports during the holiday season, our teams are working with customers to align on expected volume fluctuations. To help us prepare for a smooth summer, we encourage customers to get in touch to discuss forecasts and the best options for their cargo in this period.
Although the worst of the disruptions seen during the COVID-19 pandemic have eased, some will persist, and new challenges will emerge. Demand on Asia – Europe trade has picked up during March, indicating further growth on the import side throughout Q2 and a return to normal peak seasonality in the summer. To increase resilience of our customers’ supply chains, and our own network, our teams are working on optimising the Asia - Europe network to mitigate the impact of potential disruptions.
Our teams are continuing to evaluate the market situation and acting in the interest of keeping our customers’ supply chains moving with ease and predictability. Stay up to date with all the latest operational information on our advisory page.
Air Freight Update
Inflation, high interest rates and the geopolitical situation continue to impact growth, which is only now starting to normalise. Between January and March this year, global air freight volumes saw a decline of 11.1 percent compared to the same period in the previous year, while capacity has grown by 4.5 percent compared to the same period in 2019. Export volumes out of China have also declined due to a low demand in the West. Nevertheless, corporate sentiment continues to recover and other positive indicators, such as production and new orders, have reached nine- and 12-month highs respectively.
Rate developments through April were somewhat inconsistent, with some countries seeing reductions due to lower supply chain pressures, while others have seen little or no change due to the unpredictability of supply and demand. Meanwhile, jet fuel prices in Europe have been fluctuating more than usual due to the upcoming summer travel season and refinery outages in France related to strikes. Price development remains difficult to calculate, with the average price in April being $2.5 per gallon.
Several countries were also hit by strike action last month, leading to flight cancellations or significant delays, particularly in Germany, the UK and France. Our teams continue to monitor the situation and will keep customers informed of any potential impact to their supply chains.
The planned decarbonisation of the aviation sector recently received a possible boost with the European Parliament and EU member states reaching an agreement on ReFuelEU aviation initiative on 25 April. The agreement will require fuel suppliers to blend sustainable aviation fuels into paraffin increasingly from 2025. By 2050, this measure is expected to reduce CO2 emissions from aircraft by around 66 percent.
Maersk Air Freight continues to support the market with flexible solutions and a network that connects the dots of our customers’ supply chains, for example with the new service between Billund, Denmark and Hangzhou, China.
To learn more about our Air network and own-controlled flights, please click here.
Inland Update
Inland operations across Europe continue to be affected by industrial action in multiple countries. In the UK, train drivers across 16 operators announced strikes for the 12th, 13th, and 31st May and 3rd June, causing disruptions to passenger transport and inland operations across the country. Our planners are working closely with the rail freight operators every day to understand the overall impact this will have on our customers, and we expect to share next steps as more information becomes available.
In Germany, train drivers’ strikes have been a recurring topic from the beginning of the year. While an agreement was recently reached between the union Verdi and public sector employers, the deal is yet to be finalised. At the same time, talks remain ongoing between rail union EVG and Deutsche Bahn, with the next round of negotiations scheduled for the end of May. Maersk teams continue to monitor the situation and focus on maintaining the flow of our customers’ cargo.
From the beginning of the year, France saw frequent strike action across many different industries, including inland transportation. Operations were particularly impacted in March and April, and further disruption is possible in the coming weeks. For an overview of relief packages offered to customers, head to our advisory page.
E-Commerce Update
As inflationary pressure continues to be a concern for many consumers, e-commerce businesses are looking for ways to preserve both their margins and relationships with consumers. According to Oxford Economics, 72% of commerce executives are prioritising “increasing margins and profitability” as a strategic goal. In an effort to meet this goal, more and more businesses are shifting their focus to direct-to-consumer (D2C) selling through digital channels, where they can collect data directly from consumers, instead of relying on marketplaces and retailers.
In doing so, businesses are getting to know their customers better – meeting their evolving needs and understanding their likelihood and motivation for abandoning brands. This information transforms into actionable insights across the entire customer life cycle and helps businesses enhance customer interaction across all touchpoints, as well as optimise their processes across the entire organisation.
The main challenges lie in streamlining efforts across the different areas – establishing valuable relationships with customers, strengthening the digital presence and customer journeys, and growing core business models. With flexible and tailored solutions, businesses can exceed consumers’ expectations and stand out from the competition, while increasing customer loyalty and profitability at the same time.
Operational efficiencies, delivering products at scale and on time while reducing cost per transaction, and mastering processes like intelligent returns, doesn’t have to come with sacrifices in resilience and sustainability. To learn more about how consumer needs are changing supply chains and how to balance both sides, join our Omnichannel webinar on 16 May.
Customs Update
In April, HMRC presented a new draft of the Border Target Operating Model that aims to regulate the import of live animals, animal products, plants, and plants products from the EU to the UK. According to the model, customers will need to check the risk levels of their commodities to ensure they are prepared for upcoming changes in the border process. The project sets to simplify and digitise necessary controls, and the final version of the model will be available in June.
At the moment, implementation timelines are as follows: health certificates will be introduced from 31st October 2023, documentary and risk-based checks will start from 31st January 2024, while safety and security declarations will be required from 31st October 2024. For more information, visit the HMRC website or get in touch with your local customs representative.
Elsewhere, the EU has suspended all outstanding duties on imports from Moldova, extending the current suspension for another year. This suspension will be expanded to include all remaining duties and tariff quotas for Moldovan imports, including tomatoes, garlic, table grapes, apples, cherries, plums, and grape juice.
Global and intra-European supply chains currently face a number of challenges at the border, heralding the need for flexible solutions to stay ahead of the game. End-to-end customs control enables you to react quickly to changing circumstances and can lead to cost reductions, added security, predictability and – ultimately – a competitive advantage. Learn more about the 3 key benefits of customs control here.
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