UK Port Delays Could Affect $2 Billion In Commercial Imports

According to the latest reports on Oct.18th, analysts at risk management company Russell Group Ltd. cautioned that the disruption of UK trade imports of around $2 billion could take place just ahead of Christmas if the prevailing port delays & supply issues at Felixstowe port in England continues.

Felixstowe Port is one of the largest ports in the UK, and the port delays combined with logjams, lack of containers, and truck drivers are worsening the supply chain distress. But since the supply chain is experiencing tremendous pressure across the world, losses will likely be severe.

As per the reports, the top most reasons behind widely reported delays include the ongoing container inadequacy, port delays, congestion, higher freight expenses, logistic equipment in the wrong place, and lack of haulage choices, etc.

Kevin Rimmer, Head of Cargo at McGill said, “The problem for cargo-owners is what the delays will cause to their business activities. As we have already experienced following the Ever Given’s grounding in the Suez Canal, a considerable amount of ships contain perishable goods; delays ultimately highlight that that merchandise is compromised or even useless upon landing in their objective.”

“Moreover, the unfavorable news for many cargo owners is that “delay” is usually excluded within their marine insurance. This could imply the fact that the industry could witness severe financial losses led by the port delays within the supply chain. Losses that are unmeasurable and ultimately unsustainable. ”

Clothing would be the biggest commodity to be influenced by the delays at Felixstowe and could put notable pressure on the UK high street, with Asda and Tesco experiencing $63 million and $46 million impacts, respectively. Know, How the Shipping Industry Responded To The Global Covid-19 Pandemic?

Being one of the UK’s largest ports, Felixstowe port has a yearly progression of trade activities of over $9.6 billion and takes care of 36% of the UK’s containerized freight, as a deficiency of truck drivers creates setbacks for moving containers.

Suki Basi, CEO of Russell Group said, “The delays at Felixstowe in adapting to the repressed interest should not be a shock for the leading analysts of international trade events, as this is a problem that is influencing bigger ports from Long Beach to Yantian across the world”

“As Russell has contended before, trade is getting more & more focus, as highlighted by earlier evaluation of $7.5 trillion of international trade courses through 50 key ports. So, when there is a blockage at any significant port, there is an interruption across the value-chain for customers and companies alike.” Basi explained. However, good logistic practices can help global trade recovery.

“Surveying the effects of disruptions or blockage events like Felixstowe on trade is extremely important. This can be performed by evaluating trade activities at nation, route, operator, ship, commodity, and company levels. This method enables underwriters and corporates to evaluate their scopes on a convenient, granular basis, empowering business portfolios to stay practical in these firmly interconnected, quick evolving times.”

However, Rimmer cautioned that an answer for the more extensive issues experiencing global supply chains will be extremely complex to address, due to the intricate components at play.

He noted, “The answer to the issue is not clear either. Empowering more HGV drivers has been a critical focal point as of recently, but some other complexities require solutions too.”

“The first is the authoritative lack of container ships and mass carriers. The problem will not be solved immediately, with most shipping companies waiting for up to 12 months to witness new container vessels in circulation. The short supply of both types of vessels has implied cargo rates have increased up to five times pre-pandemic levels.”

Source
https://www.reinsurancene.ws/billions-of-dollars-of-imports-at-risk-due-to-port-supply-issues-analysts/

Other news

• 30.11.2023

  Jazan is Positioned to Develop Into a Hub for Trade with Africa

• 27.11.2023

  Is the trial of Indonesia to ‘cover up’ the interest of poor foreign investors in project of Jokowi’s Nusantara capital?

• 23.11.2023

  Global economy to slow down but likely avoid recession in 2024

• 23.11.2023

  Shadow banks of Euro zone face risk related to margin calls, says ECB

• 20.11.2023

  Start-ups are welcome to join DIFC’s FinTech World Cup

• 10.11.2023

  Turkey Gets Surprise Inflation Reprieve Ahead Of More Rate Hikes

• 09.11.2023

  China Slips Against Deflation As Recovery Stays To Be Fragile

• 27.10.2023

  Mastercard Estimates Weaker Income Growth On Financial Slowdown Uncertainties

• 27.10.2023

  The United States Decided To Retract Its Proposal Regarding Digital Trade At The World Trade Organization

• 17.10.2023

  Mastercard and Bizom have joined forces to launch a comprehensive digital supply chain