Delays are no longer a question of what-if, but how long. Vessels are stacking up along the European coast and some of them are up to four weeks late.
It began with blank sailings, equipment scarcity, and other complications, but the situation has been adversely impacted by other mitigating factors.
Mitigating Factors
“We operate a highly complex logistics system in which various subsystems interact on the water, on the rails and on the roads. Temporally and spatially. In sequences and in processes. With the arrival and departure of goods. This system fell apart. Reliable punctuality no longer exists, so there is no predictability with the ships or with the hinterland, which is reached by rail. As a result of ship delays, import and export goods sometimes arrive too early and sometimes too late. The containers that are not picked up create bottlenecks and delays in handling operations. We are making every effort to get the system back under control. But we can only do that with the cooperation of all participants in the logistics chain, with improved communication and the collaboration of everyone involved,” says Angela Titzrath, Chairwoman of the Executive Board, Hamburger Hafen and Logistics (HHLA). HHLA is one of Europe’s biggest port providers and manages three of the four ports in Hamburg.
Recently, Metrans, one of the biggest railway providers for northern and southern Europe canceled twenty-two departures. This means 2200 TEUs from this alone are clogging inland depots. This affected not only Germany, but the Czech Republic, Slovakia, Hungary, Poland, and Austria.
A Chain Reaction
The EU truck market is down to 80% capacity. It is estimated that 5-7% of the driver workforce were from Ukraine and they left the industry to go home to fight against the Russian invaders. Another 6-7% of drivers exited the industry during the lockdown. So while capacity is down 80%, experts estimate that volume is up 120%. This means approximately every third shipment is left with no way to transport it.
Port warehouses are constructed for short-term storage, but with unreliable schedules, cargo is staying much longer. However, there’s nowhere else for it to go because shippers’ warehouses inland are also full. The ports are unable to keep up with the increased volume, their processing time more than doubling from two days to approximately five.
These vessel delays are also making FCL drayage difficult. Delivery times are being canceled. Trucks loaded for these deliveries are already booked for new loads the next day, but with no delivery times for the already loaded cargo. So warehousing must be found, or the container must be kept on the chassis, but there’s a shortage of chassis.
On top of all of this, low water levels on the inland rivers are making some critical waterways impassable. The Rhine River is set to drop within seven centimeters of being impassable. The low water levels are already restricting how much fuel barges can carry. Time magazine reports, “An impassable river could halt the flow of everything from fuel to chemicals as governments try to prevent the energy crisis from tipping the region into recession.”
There’s no resolution expected until the first quarter of 2023.
Delays, at this point, are unavoidable, and everyone is adjusting their strategies to allow for more time to move and store goods. Reach out to your TOC Logistics International representative today to make your strategy as resilient as possible to these unpreventable snarls.