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1st April 2020

COVID-19 Updates

We would like to share our latest update on the Covid-19 virus.

General Status – China / Hong Kong

Our latest in-house survey now indicates that around 75% of factories are potentially back to full production. The reality however is that delayed and cancelled orders from overseas as well as a downturn in Intra Asia trade, are causing production levels to fall.

Vessels and Cancelled Sailings – Far East

In the last week, carriers have been reacting to the downturn in trade. The three carrier alliances have made significant cuts to sailings –

2M Alliance – have suspended their AE2/SWAN service for Q2, as well as cancelling individual sailings on other loops. The vessels withdrawn on AE2/SWAN are the largest 23,000 TEU ships and represent approximately 21% of their Asia to North Europe capacity.

Ocean Alliance – Have confirmed 10 void sailings for April at present, which is around 13% of their capacity. More cuts are expected into May and June.

THE Alliance – The smallest alliance has confirmed 6 sailings cancelled in April, representing around 20% of their capacity.

The situation is changing daily, and we are expecting further cuts from all three alliances.

Trains from China

The service from Wuhan has resumed this week, although at present it is only through to Hamburg, Duisburg and Mala. Rail operators are generally not accepting bookings of FCL containers for onward movement to the UK due to uncertainty over the European border restrictions.

We would ask customers still interested in this product to contact us with specific details of the cargo to be moved.

Vessels and Cancelled Sailings – South East Asia

Delayed and cancelled orders are affecting most factories in South East Asia, although ports in Vietnam, Cambodia, Indonesia and Myanmar continue to operate well.

However, these origins rely on the Asia to North Europe vessels calling at the transhipment hubs, where choices are limited due to the cancelled sailings:

Singapore – 2 out of 16 vessels are cancelled in April and currently 4 out of 16 vessels cancelled in May.

Tanjung Pelepas – 3 out of 20 vessels cancelled in April and 10 out of 20 vessels cancelled in May.

We advise customers shipping from these origins to allow an extra 7 days transit time due to the reduced number of sailings.

Vessels and Cancelled Sailings – Indian sub-continent

With complete lockdown in India, Pakistan and Sri Lanka, the carriers serving these origins are now cancelling sailings. The situation is changing rapidly, but some carriers have already cut capacity by around 25% for April and May.

General Status – India

The country remains in total lockdown until the 14th April.

We are pleased to advise that cargo received last week was eventually allowed to ship by the Indian authorities after initially being turned away at the port.

General Status – Pakistan

The lockdown in Karachi until 6th April has been extended to include other major cities and the country is largely at a standstill.

Our colleagues are working from home where possible, but with a limited ability to manage paperwork that is often subject to bank regulation.

General Status – Bangladesh

The government has extended the shut-down of all public and private offices for another 5 days to the 9th April. This unfortunately is likely to affect those customers that have paperwork delayed with Bangladesh banks.

We continue to receive cargo in Bangladesh and Chittagong port remains operational. Our CFS facilities are working with reduced labour, but we are continuing to pack containers, which are being safely delivered to the port.

General Status – Mauritius

The complete lockdown began on the 20th of March for an initial period of 2 weeks and this has now been extended to the 15th April.

General Status – Madagascar

The country remains in complete lockdown until at least the 6th April.

Air Freight

There is still little cargo moving; capacity is much reduced, and rates are still at an all time high. Some cargo scheduled to move by air is switching to sea freight and some orders have been withdrawn.

All carriers have cancelled previously agreed commitments on capacity and rates, and prices are very volatile for both imports and exports.

Airlines are deploying passenger aircraft to carry cargo only. Emirates & British Airways have started with further carriers following suit.

Northern China.

Minimal volumes available to fly and with capacity still at peak rates. Currently the demand is for medical supplies across China going into Europe and the USA.

Southern China

Capacity is available but at peak rates.

Korea

With all the passenger flight cancellations, carrier options on freighters are limited.

Rates and space available on ad hoc basis, but we foresee space issues and rates increasing this week.

Singapore

All passenger flights are cancelled from the 1st April. With the increased volumes from Southern China coming through, Singapore is at peak with limited capacity. Rates have increased again.

India

The country is on lockdown till 14th April

Pakistan

All passenger flights cancelled up until the 4th April. Further updates to follow.

Sri Lanka

Island wide curfew in place. Under lockdown till 10th April.

Mauritius

All passenger flights in/out are cancelled till further notice. The country on lock down until the 15th of April unless a government permit is issued to individuals / companies.

Bangladesh

Nearly 70% of carriers have cancelled flights in /out of Dhaka. There is limited carrier choice & limited space. The Government has declared public holidays from 26th March to 4th April due to current situation.

Madagascar

Madagascar has declared lock down. The airport is closed for passenger aircraft until the 20th April 2020. From today, all our colleagues are working from home.

Other Origins

Space is available but there is limited cargo; limited capacity and rates are rising every day.

Continental Europe

All our European offices, hubs and partners are open and working within their own government guidelines; but rates are rising and delays will increase.

Freight is still moving, although borders are closed for travellers and holiday makers. Delays are occurring because of driver health checks at border crossings and extended transit times should be expected. Priority is being given to essential freight such as foodstuffs and pharma.

Whilst we continue to try and maintain our road freight departure schedules, volumes are dropping so departures are becoming more infrequent. The situation is also challenging due to the border delays that drivers are encountering to/from the UK. We will continue to accept bookings on a case-by-case basis, and all rates will be ad hoc, please contact your usual ACS representative.

Freight movements may well be affected as DCs / warehouses cease operations.

There is also an issue with the ability to print documentation for border checks which may also affect transits.

Turkey

Most trailers moving to the UK from Turkey transit Italy. At the moment The operations on the trains and ferries are functioning but with the caveats mentioned above.

We do have a multi-modal option for flat pack freight moving from Turkey, which offers a reduction on the standard trailer rates. Please contact us if you would like details on this service

UK

Confirmed cases of the virus continue to rise in the UK and the government has instructed everyone to stay at home, apart from essential workers, until at least the 14th of April when the situation will be reviewed. Non-essential travel is not allowed. All shops, except for food shops and pharmacies, are closed, as well as restaurants, pubs and clubs.

ACS is complying with all government measures. Our offices are operating with a skeleton staff where it is necessary and will remained manned from 0:800 to 17:30; all other colleagues are working from home with full access to company systems. You will be able to reach your usual ACS contacts by phone just as if they were in the office. We do not anticipate any notable impact to our customers.

Our CORE Command Team (Central Operating Response to an Event), is monitoring the situation carefully.

UK Airports

As previously indicated, inbound freight is still flowing through with no disruption. However, volumes are significantly down.

UK Ports

Our UK ports remain fully operational, although we are seeing some congestion as a result of the on-going effort the ports are making to minimise the risk of infection to their workforce. The deep cleaning operations are taking up to 4 hours a day, during which time vehicle booking slots are removed. We are doing everything possible to minimise delays with deliveries and would ask our clients to work with us if vehicles miss their timed bookings.

COVID-19 and UK Customs Relief Measures

ACS is very much aware that many clients are unable to receive goods either due to warehouse closures, or due to a lack of warehouse space. Furthermore, as the sale of many goods have been hugely impacted due to the current restrictions, the need to protect precious funds is essential. ACS can offer solutions to postpone the payment of duty and VAT.

HM Revenue and Customs has announced some relaxation of regulations which include:

  • Postponing the payment of VAT for the period 20th March to 30th June 2020, but at this moment in time, this excludes import VAT
  • Relaxing the regulations to assist the import of goods from outside the European Union used in the fight against COVID-19, including duty and VAT relief
  • Helping businesses who have difficulties with Customs debt and the provision of guarantees
  • Assisting importers who have difficulty meeting their obligations to submit supplementary customs declarations within the deadlines
  • For further information, speak to your normal ACS contact who will be able to provide further information and assistance.

UK Transport

The current Government advice permits customers operating warehouses to continue taking deliveries of even non-essential goods, provided they are complying with the official government advice.

ACS has a good availability of transport and will continue to provide delivery services whilst the ports and airports remain open.

We ask our clients to please facilitate our drivers so that they can access toilet and hand washing facilities.

Storage of Cargo and Laden Containers

ACS has taken space at various locations in order to assist customers who are unable to accept deliveries. If this facility is required, please communicate with your usual ACS contacts for further information.

UK Exports

Sea

Over the first two weeks of April there would normally be 37 export sailings on the UK to Asia trade. However, the first wave of cancelled vessels from China in February and early March has reduced the number to just 28. The lack of vessels is causing space problems and increased rates for exports, and we would ask clients to book with us as early as possible.

Air

Export contract rates have been withdrawn till further notice and only ad hoc market rates are available.

Emirates has announced they will be converting passenger 777 into cargo only freighters. Capacity will increase for European movements, along with ISC and middle east. Rates for these services are on ad hoc basis.

 

*ACS Operations, 1st April 2020*

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