2021 BREXIT and Container Rates

2021 has begun and it looks like it is going to be another year of issues in the logistics sector.  To start off with it appears that container rates from China to the UK are attempting to beat bitcoin for the fastest increase in spot pricing. Currently container rates for sailings this week and next week are at 11500USD per forty foot container about 9000USD more than normally expected. LCL pricing is seeing similar with peak rate surcharges over 200USD per cubic metre. This pricing has topped anything ever seen. Despite this enormous price increase China agents are still advising that space needs to be booked as soon as possible due to reduced sailing schedules to the UK. At the moment it still looks like it will be February before things settle down and may well go into March/April if the ports do not get themselves sorted out.

Lines such as CMA-CGM have been forced to suspend calling at Felixstowe due to the on going congestion situation. The delays at Felixstowe were becoming so bad that the vessels where beginning to bunch up at the UK end and then when they finally berthed they discharge and reload was slower then normally.  This has been impacting the overall line schedule. Containers for the UK are being left in Rotterdam for eventually transshipping into the UK. With the volume of containers involved the actually transshipment date and finally arrival in the UK can be up two weeks from the original ETA. Shipments which are making it to UK ports are constantly being delayed from their original eta’s. We have had shipments arriving 10days later than originally planned, which is then resulting in haulage being cancelled. Congestion issues are not just limited to the UK with LA and Long Beach in California,USA both experience serious congestion. Most vessels arriving at either port are having to wait for a free berth at anchor.

BREXIT has finally happened with the UK leaving the EU at 2300hrs on Thursday December 31st. Within the last few days of 2020 a trade agreement was reached which meant most goods will continue to move between the two trading areas without any tariffs. Shipments have continued to move across the borders without any significant issues. In fact the biggest issue was when the French banned all incoming traffic  from the due to the COVID virus which resulted in complete chaos just before Christmas. This took over a week to get fully resolved so it is perhaps fortunate that a trade agreement was reached.

Despite the fact that a trade agreement has been reached, imports and exports to the EU will now need a full customs entry to be done. This means shippers and consignees need to ensure all their paperwork is in order. The majority of goods being imported from the EU will not attract any additional duty due to the trade agreement which means there will be no actual increase in price for the goods but there will be additionally charges in handling the customs paperwork.