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Turmoil in the supply chain persists

Impact of Eastern European conflict on supply chains

Early this week, the FIATA Multimodal Transport Institute (MTI) came together to discuss the impacts of the ongoing conflict in Ukraine on freight forwarding and logistics across sea, rail and road transport. Beyond the dramatic human consequences to which the sector is particularly moved, global supply chains, already weakened by the effects of the pandemic and the ongoing maritime crisis, are being significantly impacted. Issues cited include driver shortages, difficulties to transport cargo within the affected region, and capacity issues. Rising fuel prices are expected to be a challenge for the industry as a whole.
It was noted that multimodal solutions are key to ensuring the flow of goods around the affected area throughout this conflict, with border crossings reportedly being possible through rail transport across Moldova and the Port of Galati, or through Romania which provides port access. Trans-Caspian routes are expected to play a key role.
FIATA members should be aware of the sanctions imposed by certain countries in response to the conflict, and should ensure that they consult the relevant government pages on a regular basis. Currently, countries imposing related sanctions include, inter aliaAustraliaEuropean UnionUnited Kingdom, and United States. It is understood that further sanctions are under contemplation.

ICC-WTO standards toolkit featuring FIATA eFBL data standard

The toolkit, which was published on March 15, identifies approximately 100 available standards, including the FIATA eFBL data standard, which can be used to facilitate trusted, real-time supply chain collaboration and real-time data exchange.

The scope of the toolkit is to equip all supply chain participants with an easy-to-use reference guide of the main existing standards for trade digitalisation. Standards are key to facilitating interoperability as they enable industry stakeholders to speak the same language, allowing data to be transferred from one platform to another seamlessly. FIATA encourages all of its members to use and promote the standards available in the toolkit to accelerate the digitalisation of trade processes.

For more information on the FIATA eFBL, and FIATA's digitalisation projects, please follow this link.

COVID-19 resurgence and closure of Chinese ports

Executives of major carriers are pondering the fresh lockdowns in Shenzhen (and, reportedly, many other provinces), which will go on until 20 March. If this phenomenon prolongs and extends to further regions, there will be serious pressures on vessel flow already operating with all-time low schedule reliability, according to The Loadstar.

'All mass transport facilities have ceased their operations. Sea freight logistics are troubled and truck drivers arriving to ports must show their negative COVID-19 test results.' said Charles Liang, member of FIATA Working Group Sea. He continued: 'Sea ports near to Shekou ceased to operate as of March 14. Most warehouses in the Shenzhen area have stopped inbound and outbound operations while some still accept inbound shipments. This situation will last until at least the end of the week.'

“With the announcement of lockdowns, the supply chain must prepare for more turmoil in the coming months, impeding the flow of container movement as importers worldwide prepare for the peak season later this year,” Container xChange said. “Clearly, 2022 has not brought any cheer to the supply chain industry.”

Container xChange also estimated average Chinese container prices of down to $5,329 on 27 February, for a 40ft high-cube unit at the port of Ningbo, from $5,930 on 14 February. Other Chinese ports including Shanghai, Qingdao and Shenzhen, also saw average prices fall this month.

“Lockdowns in China will further reduce capacity and cause a surge in already inflated shipping prices,” said ContainerXChange CEO Johannes Schlingmeier. “The shockwaves will be felt almost everywhere in the world.”


Upcoming events where FIATA is participating:

  • 21 March ¦ WTO Global Supply Chains Forum
  • 22-23 March ¦ TIACA Executive Summit
  • 17-20 May ¦ FIATA HQ Meeting 2022, Geneva
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