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9th April 2020

COVID-19 Updates

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

General Status – China / Hong Kong

China’s recovery continues, and our own customer base shows that around 75% of factories are potentially back to full production. There is regional variation: Jiangsu (100% in Nanjing) and Guangdong (91% in Guangzhou; 63% in Shenzhen), compared to factories in Fujian (33% in Fuzhou). Unfortunately, reduced and cancelled orders as a result of the Covid-19 pandemic are now causing a cut in production at many factories.

Vessels and Cancelled Sailings – Far East

In reaction to the downturn in trade, the ocean freight carriers have continued to reduce capacity over the last week. The situation is changing daily, but a brief summary of the current situation with the three alliances operating on the Asia to North Europe trade is:

2M Alliance – have suspended their AE2/SWAN service for Q2, as well as cancelling individual sailings on other loops. There is approximately 33% of capacity withdrawn over the remainder of April.

Ocean Alliance – have announced further void sailings over 6 of their 7 loops. There is approximately 26% of capacity withdrawn in April.

THE Alliance – have cancelled 28% of their capacity in April. They have also announced that they will temporarily merge two of their five loops in May, which will result in a reduction of at least 25% in May and June.

The situation is very fluid, and we expect further cuts from all three alliances

Trains from China

Our FCL Services to the UK combining train and ferry services remain suspended, due to uncertainties over European border restrictions. It is possible to terminate shipments at Hamburg, Duisburg or Mala and make independent arrangements, although unpacking in Poland and transport by trailer is a safer and more cost-effective option.

Customers interested in this routing should contact us with specific details of their cargo.

Vessels and Cancelled Sailings – South East Asia

We have seen a considerable reduction in shipments from South East Asia

These origins rely heavily on the Asia to North Europe vessels calling at the transhipment hubs. The number of cancelled vessels through transhipment hubs has increased over the last week and now stands at:

Singapore – 5 out of 16 vessels cancelled in April, and currently there are 6 out of 16 vessels cancelled in May.

Tanjung Pelepas – 4 out of 20 vessels cancelled in April, and 11 out of 20 vessels cancelled in May.

For UK customers who are still shipping from SE Asia, the reduction in shipment options is causing longer transit times and we still suggest to budget for an extra 7 days in transit.

Vessels and Cancelled Sailings – Indian subcontinent

Complete lockdown in India, Pakistan and Sri Lanka continues, the carriers serving these origins are not receiving any non-essential cargo. Most carriers have now either omitted ports or voided vessels for the last two or three weeks. The capacity taken out is around 25% at present, although this looks set to increase if the lockdowns are extended.

General Status – India

The country remains in total lockdown until the 14th April, but infections are rapidly increasing and there is growing demand for this to be extended to the 30th April.

General Status – Pakistan

The lockdown in Karachi until 6th April has been extended to the 14th April and now includes other major cities. The lockdown includes the transportation of non-essential goods, so the country is largely at a standstill.

General Status – Bangladesh

The government has extended the shut-down of all public and private offices until the 14th of April and most factories are closed. Although banks are trading from 10.00 to 12.00 there will be a delay in processing bank documents for many customers.

We continue to receive cargo in Bangladesh, and Chittagong port remains operational. Our CFS facilities are working with reduced labour, but we continue to pack containers for those customers who are still shipping.

General Status – Sri Lanka

Sri Lanka is under lockdown and it is unclear when this will be lifted. Reports of the end date currently vary from the 14th to the 30th of April. There may be regional variations.

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, which has now been extended to the 21st April

Air Freight

As stated in our previous update, there is still very little cargo moving, capacity is much reduced, and rates are still at an all-time high. Some cargo scheduled to move by air has switched 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.

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. After this, the government is currently planning a staggered exit from lockdown over a 21-day period but there is pressure to extend it.

Pakistan

All passenger flights were cancelled up until the 4th April. Flights are now available into Europe with increased rates.

Sri Lanka

There is an island-wide curfew and lockdown in place.

Mauritius

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

Bangladesh.

Passenger flights are suspended until the 14th of April; otherwise there is limited space. The Government has extended the public holidays previously due to end on the 4th of April until the 14th of April 2020.

Madagascar

Madagascar is in lockdown. The airport is closed for passenger aircraft until the 20th April 2020. All our colleagues are working from home.

Other Origins

Space is available but there is limited cargo, limited capacity and rates are rising daily.

Continental Europe

There has been little change since our last update. 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.

France

On the 6th of April, the French authorities introduced a new requirement for those wishing to enter France – each driver coming into France from any other country must provide a certificate or “attestation” in order to enter mainland France. Drivers must be able to show these to the French police on request. Further details are available here. Or please check with your ACS contact.

Turkey

Most trailers moving to the UK from Turkey transit Italy. 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.

We also have some sea freight services available from Turkey. Please contact us if you would like details.

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 08:00 to 17:30; all other colleagues are working from home with full access to company systems. You can reach your usual ACS contacts by phone.

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.

As the effects of the pandemic continue to be felt by aviation, airlines and UK ground handlers have reduced their manpower and started consolidating cargo business at all major airports. As a result, peak surcharges are being imposed, driven by the carriers and handling agents and covering both import & export movements.

UK Ports

Our ports remain operational, although with fewer workers and infection prevention measures in place.

We are experiencing some congestion issues and delays of up to 4 hours to pick up and drop off containers. Vehicle booking slots are also being reduced for up to 4 hours per day in order that daily deep cleaning can take place.

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.

UK Transport

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

ACS 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 handwashing facilities.

Storage of Cargo and Laden Containers

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

UK Exports

Sea

Over the next two weeks, we would have expected 26 Asia to North Europe vessels to arrive into our ports, but cancelled sailings from Asia has reduced this down to 18.

Fewer vessels means that space is still tight, and this is keeping up rates at present.

There are indications that demand for export space is beginning to ease, although we are expecting a new and more severe round of cancelled sailings in the weeks to come which may maintain the pressure on space.

Please continue to book early with our export teams.

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.

UK Government Support for Business

The Government has expanded its support for exporting businesses during the current crisis through the provision of guarantees for bank loans for those companies facing disruption due to late payments and insurance cover for exporters who are worried as to whether they will get paid by their clients. Further information and details of how to apply can be found by following this link for export working capital and here for insurance. Support is available to business in a wide range of areas including general financial assistance and business advice. Further information can be found here.

*ACS Operations, 9th April 2020*

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