Coronavirus (COVID -19) Impact · 2020-04-14 · Coronavirus (COVID -19) Impact Report Rev # 0...

Coronavirus (COVID-19) Impact Report Rev # 0 deugro-group.com April 23, 2020 of 22

ISO 9001:2015 ISO 14001:2015 BS OHSAS 18001:2007

Coronavirus (COVID-19) Impact


Index Coronavirus (COVID-19) Impact 3

Ocean freight overview 4

Commercial Overview – Containers 4

Idle Containership Capacity and Blank Sailings 5

Carriers’ Liquidity 5

Breakbulk and Chartering 6

COVID-19 Port Restrictions 7

Equipment Imbalance 7

Air freight overview 9

Capacity 9

Rate trends 10

Intercontinental air freight traffic to and from Europe 11

Intra-EU, cross-border cargo transfers 12

EU travel advice and border measures 13

Current operational status of our branches 14

Country updates 15

Useful links 22


Coronavirus (COVID-19) Impact

Update 6 | April 23, 2020

The coronavirus pandemic has now been confirmed in over 210 countries and territories globally since it was f irst discovered in the Chinese city of Wuhan in late December 2019. We continue to closely monitor the global situation, and in this f ifth edition of the deugro group COVID-19 update, we are focusing on the continued impacts the virus is having globally in terms of logistics and supply chain activities. Since the last report, issued on April 9, the total number of infections has increased by more than 1 million in two weeks. With 1 million global cases recorded on April 2, the number of global cases now surpasses 2.5 million as of April 21. The USA has the highest number of cases, with over 820,000 recorded. Despite the ongoing strict lockdown arrangements in force in Europe, the number of cases are now over 1 million, with Spain, Italy, Germany, the UK and France being the most affected. However, the number of cases seems to be slowing down, providing some positive news as Denmark, Switzerland, Austria and Germany begin to take steps to end the lockdown situation. US oil prices turned negative for the first time on record this week, after oil producers ran out of space to store the oversupply of crude caused by the ongoing COVID-19 pandemic. WTI Crude was listed at 18 US dollars per barrel on opening April 20 and then crashed to a low of minus 38 US dollars as concerns were raised on the availability and costs associated with the storage of oil. The collapse in the oil price occurred less than two weeks af ter OPEC+ agreed to cut between 10 to 20 million barrels of oil from the market from next month, but the OPEC+ cuts falling far short with regards to the huge reduction in demand. Brent Crude fell as low as 16 US dollars per barrel this week; it’s lowest since 1999. In total, oil prices have slumped 80% in 2020 since the pandemic hit. The viral outbreak has caused fuel demand to drop by roughly 30% worldwide, and energy companies in the USA, the world’s biggest producer, are struggling to find storage for excess oil. This is seen as a direct result of large investments in O&G coinciding with an immediate and unplanned demand shock in an area with limited storage and transportation capabilities. The U.S. Secretary of Energy has stated that oil production could fall from 13 million barrels a day to 3 million by the end of 2020. Further global cuts will be needed f rom OPEC+ and other producers to support the industry at this unprecedented time. The economic impact of COVID-19 and the oil crisis continues to develop. It is stated that the USA has seen over 20 million people file for unemployment over the last month, with France also seeing around 10 million unemployment claims in the same period. The speed and scale of job losses in light of the pandemic is not in line with a recession, with experts stating it is more aligned to a natural disaster in size and scale, as governments attempt to manage the impact by providing ongoing support with continued stimulus packages.

During the previous week, Singapore extended their ban on all social gatherings, with the Prime Minister conf irming the plan is now to remain in effect for an extra four weeks, until June 1. The UK government recently extended the lockdown until May 7 at the earliest, while Spain hopes to lift restrictions in the second half of May. Meanwhile, the COVID-19 impact in New York remains severe, certain states in the USA have started to reopen business to kick-start the economy in accordance with expert advice from health and business specialist. As we continue to work through the COVID-19 pandemic, our number one aim is the safety and health of our employees, clients and partners. We continue to adhere to and promote governments’ and health experts’ recommendations for personal, workplace and community health, working together with our employees to support and protect them and their families and to prevent the spread of the virus, including complying with social distancing requirements and implementing flexible and home working where possible. We are pleased to confirm that all deugro group global offices remain operational and capable of supporting clients’ requirements. Should you have any questions, please continue to engage with your local deugro contact, who will strive to provide full support.


Ocean freight overview

The ongoing COVID-19 pandemic continues to cause major disruptions in the supply chains worldwide. These disturbances are driven by significantly reduced demand for goods and services due to slow economic activity, oversupply and lack of storage facilities for certain commodities, and high demand and lack of availability for others. This greatly affects ocean freight rates and services for both container and breakbulk shipments. In the second part of April 2020, we continue to witness unprecedented imbalances between supply and demand among ocean freight providers and shippers. The shipping lines continue to announce blank sailings, amended schedules and increased transit times in an effort to preserve their liquidity and hold the line on f reight rates. The high number of canceled sailings, closed businesses and full warehouses is causing a congestion at certain ports due to the lack of storage and deficit of empty containers.

Commercial overview – containers

The shipping lines continue to announce blank sailings and service suspensions being implemented globally. This leads to fully booked vessels and increased difficulty in securing space at short notice. Due to the continuing reduction in fuel costs, the container carriers are also extending their round voyages to absorb capacity. These factors have an operational impact and emphasize the importance of advance planning and allowing longer booking times to ensure space and service availability. According to this week’s publication of Sea Intelligence Consulting, the container shipping sector will get hit disproportionately hard compared to other cargo sectors. The container carriers are expected to suffer a combined 10% drop in volume this year; however, the lines have resolved to maintain the existing level of f reight rates thus far.

The sustained freight levels can be seen in the year-on-year comparison of the Freightos Baltic Global Container Index™ (FBX) as shown in the f igure below. The FBX is a set of indices that reflect ocean container transport spot freight rates across 12 global trade lanes.

Figure 1: Year-on-year FBX Global Container Freight Index


Idle containership capacity and blank sailings

According to Alphaliner, idled containership capacity is expected to reach a record high of 3 million TEU within weeks, in the “worst capacity crisis the industry has ever seen.” With over 250 sailings already withdrawn in the second quarter, it is expected that the lay-ups will push the idle f leet to a level twice that seen during the 2008/2009 global financial crisis. Capacity cuts are being announced on all key routes. In addition to the main Asia ‒ Europe and transpacific trades, carriers have also reduced capacity on the transatlantic, Latin America, Middle East, Indian subcontinent, Africa and Oceania routes, since up to a quarter of the world’s population is in lockdown and non-essential retailers closed. Drewry’s newly introduced Cancelled Sailings Tracker provides a snapshot of monthly blank sailings announced by each alliance against the total number of scheduled sailings.

Figure 2: Blank sailings vs. Scheduled sailings (Source: Drewry Supply Chain Advisors)

According to Drewry’s report, an additional nine sailings have been withdrawn on the transpacific and Asia ‒ Northern Europe / Mediterranean route in week 20 (May 11‒17, 2020), bringing the total of the two first

weeks of May to 28 cancellations against 82 scheduled sailings for this period (34%). When looking at the same period in April, we see a 17% increase in cancellations and a total capacity of 234.297 TEU missing in the Asia ‒ Northern Europe / Mediterranean and transpacific trades.

deugro is working closely with its clients and vendors to ensure that bookings are made on time, to anticipate delays and longer lead times, and to select best sailing schedules in order to ensure that critical cargo is delivered on time and the projects’ required on-site dates are met.

Carriers’ liquidity

The industry is following the financial performance of 14 major container carriers with great concern after the publication of their Altman Z scores, based on their 2019 f igures, indicating a high probability of insolvency. Alphaliner’s recent report indicates that “the deteriorating global economic outlook, which pushed container shipping lines to withdraw an unprecedented amount of capacity in April and May, will hurt carriers’ operating cash f lows and further weaken their f ragile balance sheets.” Carriers with a poor track record on negative earnings and those with current liabilities exceeding current assets are considered to be at risk. As a global organization, deugro is closely monitoring the commercial impact on the carriers. We believe that the market may be impacted heavily down the supply chain. It remains to be seen whether there will be any bankruptcies amongst the container carriers in the near future.


Breakbulk and chartering

Charter rates continue to remain volatile and under pressure in the second half of April 2020, since many countries around the world continue to be under lockdown. The rising economic activity being observed in China during, recent weeks is leading to a slowly rising demand for dry bulk freight from that region. The Baltic Dry Index, which measures the cost of shipping goods around the world, strengthened to over 700 points in April 2020, a level not seen since January, as gradual restart of industrial activity in China led to improved demand for shipping vessels. For the first quarter of 2020, however, the index slipped 43% as the rapid spread of coronavirus around the world lead to shipping restrictions and sapped demand for dry bulk vessels.

Figure 3: Baltic Dry Index

At the same time, it has been reported that time charter rates for multi-purpose vessels are showing a downward tendency. This reflects the current low demand in multi-purpose transport services and, consequently, less demand in taking ships by operators. The decreasing time charter rates will show an effect on the market with some time delay, since time charter contracts usually cover a certain minimum time period, normally three months. It has been reported that multi-purpose vessel operators are in talks with vessel head owners to reduce existing time charter rates and/or to defer part of the daily rates at the moment. This development shows the reduced demand in MPP shipments for certain trade lanes, and an immediate effect should be seen. A major concern for the shipping industry in general is that crew changes are on hold at present. Many ports are not allowing crew members to disembark, and home flights are available on a limited basis only. Around 1.6 million seafarers around the world are caught in the center of this, on 50,000 tankers and cargo carriers. Every month, 100,000 merchant mariners come to the end of their contracts on their ships and need to be f lown home. Many of them are unable to leave their ships or find themselves stuck in hotels without pay and unable to get flights home. This results in longer turns of the crew on board the vessels, which could potentially lead to exhaustion among the crew due to lack of rest and recuperation. No deugro booking is currently subject to a quarantine situation on board a vessel. Analysts expect the COVID-19 outbreak to have a long-lasting impact; a rebound in rates will be reliant on containment—the longer and more widespread the COVID-19 outbreak, the more damage it will cause.


In order to manage the strong impact seen on freight rates, the limited vessel space and equipment availability, and services, cargo owners, shippers and deugro offices need to work closely together by communicating early and allowing longer planning cycles to manage this operational and commercial risk. Get in touch with your local deugro office, and we will work with our internal global charter team on these matters. Together.

COVID-19 port restrictions

With countries across the globe announcing further restrictions, which may also differ from one another, keeping track of these for ships and crews is challenging. To help make this easier, we would like to share the “COVID-19 Port Restrictions Map,” produced by Wilhelmsen Ships Service. It provides status updates twice per day of restrictions at a click on countries and ports. Locations with updated information from within the last 24 hours are highlighted. The map can be viewed at: https://www.wilhelmsen.com/ships-agency/campaigns/coronavirus/coronavirus-map/

Figure 4: COVID-19 Port Restrictions Map by Wilhelmsen Ships Services

Equipment imbalance

The carriers continue to reduce head haul capacity through blank sailings in the second part of April 2020. This risks a shortage of equipment being imported for backhaul volumes. The global lockdown and subsequent downturn in economic activity and consumer demand means that containers continue to be stuck in ports and freight stations. Container imbalance remains, with the majority of equipment surplus seen in Asia. Even though production in Asia is steadily increasing, the reduction in demand in Europe and the USA is leading to further blank sailings. Ports around the world are already looking to secure more space or free up temporary space for container storage. The graph below shows an overview of the current container availability worldwide for calendar week 17. The data is based on CAx (Container Availability Index).

https://www.wilhelmsen.com/ships-agency/campaigns/coronavirus/coronavirus-map/


Last week’s trend of an increasing deficit in equipment availability in Europe and the USA continues. The main change f rom week 15 is resumed availability of 40' HC containers in Europe and resumed lack of

availability of 20' and 40' DV containers in India.

Region Port 20’DV 40’DV 40’HC

Asia

Shanghai

Qingdao

Singapore

Port Kelang

Europe

Genoa

Rotterdam

Antwerp

Hamburg

Africa Durban

North America

Chicago

Los Angeles

India Nhava Sheva

Figure 5: Calendar week 17 | Container availability worldwide (Source: xChange)

Red – Def icit of containers (incl. full and empty units, SOC and COC) Green – Surplus of containers (incl. full and empty units, SOC and COC)


Air freight overview The air f reight industry is enduring the heaviest impact and restrictions caused by the rapid spread of the coronavirus pandemic. Still, the transportation mode of air f reight is seen as a lifesaving rope to mitigate disruption to traditional supply chains across the globe. The majority of international airports remain operational, even though international passenger travel has widely suspended. Fortunately, the transportation of goods and repatriation services remain to be intact to keep supply chains from collapsing. COVID-19 has led to a significant change in demand and supply. Air cargo makes up about 35% of global trade by value (only 1% by volume), according to the International Air Transport Association (IATA). In general, air cargo includes pharmaceuticals, consumer electronics such as laptops and mobile devices, auto parts for just-in-time delivery, fruits, vegetables and flowers, but demand has shifted to urgently needed medical supplies and essential goods urgently needed to fight the virus. While shipping lines have some ongoing equipment imbalance issues and bookings or space can only be obtained a few weeks in advance, the impact we have seen in the air f reight market is so much bigger, since timelines are shorter and impacts noticed immediately. The lack of belly space on passenger aircraft has created a considerable bottleneck, which so far has only been partly alleviated by adding freighters and/or converting passenger aircraft to makeshift substitutes until regular f light schedules resume. The backlog of cargo at its origins continues to grow, since space is tight and warehouses at destinations are f illing up with cargo not collected by the consignees due to lack in consumer goods being purchased.

Capacity

The total global air cargo capacity decreased by 31% compared to the same week in 2019, mainly due to grounded passenger aircraft fleets. The highest decrease in capacity has been noted on the Europe ‒ USA,

South America and Africa trade lanes, whereby the transpacific trade lane is seeing a decline of just under 10% compared to last year.

Figure 6: Seabury


In order to combat skeleton schedules and major shortages of cargo capacity, some airlines started to redeploy parked aircraft to meet coronavirus-related need. Wide-body aircraft and freighter aircraft remain in high demand. Special air cargo bridge arrangements between carriers and governments, as well as dedicated weekly air f reight services for organizations and governments, have been put in place to ensure the flow of urgently needed supplies. Those services are in place for a limited number of weeks as of now, but according to Air Cargo News, some services may remain in place over the long term, to boost capacities to certain regions such as Africa and the Middle East and to fill the demand gap. To speed up deliveries, we see efforts from governments and diplomats, as well as guidelines issued by The European Commission, to support expediting the process to obtain landing rights for flights transporting medical supplies and sanitary goods. Various exemptions are being granted due to the extreme importance of the goods for the receiving side, amid news channels reporting bureaucracy blocking a smooth flow of cargo with inadequate ground infrastructure to, from and within airports.

The situation of fully booked freighter operations will prevail until the end of May. Most aircraft are in the air nearly nonstop or waiting to be processed at airports, which experience has shown leads to a backlog of cargo for import and export loading activities. The industry announced a challenge to prepare for in the coming weeks: Aircraft maintenance for aircraft currently in nonstop operations.

Aircraf t availability for charters continues to be scarce; however, there are still options available for part charters (20 MT and up), as well as full-charter cargo delivery in the event of a lack of capacity on scheduled lanes. For smaller sized cargo that fits through belly-deck cargo doors, there is plenty of available options using wide-body passenger aircraft (e.g. B777, B787, B767, A330) for cargo-only charters. Heavy ramp aircraft suitable for project cargo (AN-124 and IL-76) are being used to move critical medical goods, which is causing a continuous lack of capacity for any time-critical project cargo.

Rate trends

Several weeks into the worldwide restrictions with lockdown extensions and suspended activities at manufacturing facilities, the majority of airlines continue to follow stringent cost-saving measures with reduced and/or suspended flight operations. The severe cut in capacity and the demand-driven requirements have led to a significant increase in air f reight rates and major commercial fluctuations as a result. Airlines are quoting rates, while space is available. Once the allocation has been sold, a new rate is applied. This is reducing the given rate validity in some cases to a matter of hours. While the majority of cargo is subject to premium rates, the introduction of COVID-19 surcharges by handling agents and haulage companies has been noted in some countries, adding additional costs to the supply chain. Across the project market, we see cargo shipments impacted by the above-mentioned reduced airline services, lockdowns at origins and destinations, as well as seasonal holidays impacting freight flows.


Intercontinental air freight traffic to and from Europe

As demand for medical equipment to fight the spread and impact of COVID-19 remains high and continues to increase in some parts in the world, we are seeing a similar situation to the previous weeks’ status for intercontinental air freight traffic to and from Europe:

• Europe WESTBOUND (to North and South America): The situation remains critical and subject to rate increases and scarce space availability as airlines continue with the reduction of their f leets.

• Europe EASTBOUND (Europe to Far East): The situation remains critical and subject to rate

increases and scarce space availability as airlines continue with the reduction of their fleets.

• Far East to Europe: Enormous amount of demand for aid and relief charters, with rate levels extremely high. Availability is very scarce and needs to be confirmed on a daily basis.

deugro’s dedicated air charter team is in constant communication with its strategic airline partners to ensure access to the capacity required for our clients.


Intra-EU, cross-border cargo transfers

In the attempt to slow the spread of the coronavirus, the borders of most EU countries and Russia remain of ficially closed to all but essential travel. Cross-border trucking of cargo is possible to allow keeping supply chains open. Many loading and unloading points are currently experiencing long waiting times due to extensive security checks, reduced staff and shortened opening hours, despite so-called Green Lanes for cargo trucks being implemented to ease cross-border traffic. The transit time in pre- and on-carriage may be elongated slightly due to reduced freight capacity, truck availability, and extended processing times at border controls as well as strict sanitary measures in place.

On the website covid-19.sixfold.com, you can easily monitor the

expected times that trucks are currently spending for crossing

intra-EU borders.

Figure 7: Sixfold website map with border crossing time (dated April 23, 2020)

The border crossing time is the average time that trucks spend in the border crossing corridor. These corridors are approximately 10 kilometers long; their centers are displayed on the map.

https://covid-19.sixfold.com/


EU travel advice and border measures

The EU travel restrictions remain in place, in the national governments’ attempt to contain the spread of the coronavirus across Europe. All EU member states, except Ireland, and all Schengen-associated countries (Iceland, Liechtenstein, Norway, Switzerland) have applied the restriction of non-essential travel from third countries into the EU. Below is a map showing various restrictions implemented by countries across Europe:

Figure 8: Restricted movement of people across the EU, except Ireland (dated April 15)


Current operational status of our branches

Figure 9: Current operational status of deugro branches (April 23, 2020)

Dark Gray – Branch operational, personnel working remotely from home

Medium Gray – Branch operational, staff on rotation

Blue – Branch operational, with required measures in place


Country updates As some markets/countries are more in the spotlight due to the intensity of the virus spreading or due to their importance in logistics, we want to provide a brief update for some of those markets on the following pages. On a global level, the following can be noted:

Cargo f low for goods and essential items are not affected, and countries are doing all they can to not delay or interrupt supply chains. However, certain measures taken have a direct impact on f reight and equipment capacities, transport costs, operation processing times and delivery schedules.

Most ports, ocean carriers and warehouses are fully operational, despite challenges with schedules, space and equipment availability and reduced manpower, as well as inland equipment shortages potentially being limited. The implementation of peak season surcharges due to lack of sailings seems to be more common

as vessel are fully booked into the first weeks of May. Equipment will start becoming scarce, especially for inland pick-ups. Due to an increase in the number of blank sailings worldwide, equipment is incurring more detention and demurrage, and inland transportation is under heavy constraint.

Most passenger airlines are keeping aircraft grounded and services suspended until further notice. The cancellation of services has significantly reduced cargo capacity on most major traffic lanes. In all regions, freight movement is still possible but with limited space and capacity, rate increases and short-term rate validities.

Please f ind below an overview of the various regions and short country updates outlining their current status: Europe 16

Americas 17

Asia 18

Middle East 20

Africa 21


Europe

In order to fight the spread of COVID-19 across Europe, border crossings within the Schengen area and between the European Union and neighboring countries remain partially or completely closed. All branches are operational, with personnel currently working remotely from home or partly in the office on rotation. Please refer to the table below for latest country status updates:

Country

Latest lock-down period

Belgium

No major disruptions in

domestic or international road freight have been

noticed so far. Equipment and driver availability remain

stable.

Ports are fully operational,

increasingly lack of equipment and rolling of bookings due to

blank sailings. The Port of Antwerp continues to restrict

external people from entering their premises.

Airports are operating

with limited capacity. Passenger flights are

mainly suspended; cargo flights operational.

Potentially

easing restrictions from

May 5 onward

Denmark

Borders are closed but

remain open for reduced transportation of cargo.

Ports are fully operational, but

delays are expected at suppliers’ loading facilities.




Started to ease

restrictions in week 16 by

opening some stores and

schools

France

Domestic transportation is operational.

Ports are fully operational, increasingly lack of equipment,

manpower and rolling of bookings due to blank sailings

are impacting port activities.

Orly Airport is fully

closed, whereas Paris-

Charles De Gaulle Airport is operational with a focus

on freight cargo flights.

Until May 11 (at the earliest)

Germany

Domestic transportation is operational, despite borders

to most neighboring countries being partially

closed.

FCL container terminals have been assigned delivery time

slots. No containers delivered outside of the time slot will be

accepted. Equipment availability in

hinterland depots has noticeably decreased.

Airports are fully operational, with cargo

flights dominating the activities. Due to a lack of

belly space, most airlines require prenotice of up to

10 days.

Started to ease restrictions on

April 20, with non-essential

stores to open in some states

Italy

Domestic transportation is

operational, manufacturing still widely suspended



blank sailings.

Milan LIN is fully closed,

and Milan MXP T1 is closed.

Until May 3 (at

the earliest)

Netherlands

Domestic transportation is

operational, “green lane for freight transports open to

Belgium



blank sailings




No national

restrictions implemented

Russia Domestic and international

transportation is not restricted.

Currently, there are no

restrictions or impacts on ocean freight and port operations.

All regular and charter

flights to other countries have been suspended.

Until April 30 (at

the earliest)

Scandinavia

No major disruptions in

domestic or international road freight. Closed EU

borders result in longer transit times and are limiting

ferry connections.

Ports are fully operational, but

transit times are affected due to the blank sailings of shipping

lines on main voyages.

Airports remain

operational with most passenger flights

suspended, affecting the cargo freight sector.

Only social

distancing instructions in

place

Spain

Borders are closed but remain open for

transportation of cargo.

Ports are fully operational, increasingly lack of equipment

and rolling of bookings due to blank sailings

Airports are operating with limited capacity.

Most passenger flights remain suspended; cargo

flights operational.

People movement

restricted until April 26

United Kingdom

Domestic and cross-border

transportation are operational, albeit at a

premium cost for collections and airport transfers.

Ports are fully operational but

facing congestion and bottlenecks at loading facilities.

Warehouse space is becoming scarce.




May 7 (at the

earliest)


Americas

All branches are operational, with personnel currently working remotely from home or partly in the office on rotation. Please refer to the table below for latest country status updates:

Country

Latest

lock-down

period

Brazil

All borders are closed, and entry is not permitted for

foreigners, with a few exceptions. Cargo flows are

not restricted, but trucking is limited, and delays are to be

expected.

Ports are operating normally; no impact as of now at all on

the operational side. Some port calls have been canceled

on the outbound, and the consolidation of volumes is

targeted.

Airports are operational. Hardly any passenger

aircraft available, and the carriers operating the cargo

planes are only accepting bookings based on priority

bookings.

Until April 22 (at the

earliest)

Canada

Canada‒USA border closure

has been extended for

another month, until May 20, for non-essential travelers;

access remains open for commercial cargo. The

Canada Border Services Agency (CBSA) has

temporarily reduced service hours.

The ports of Montreal, Halifax

and Vancouver are running at full capacity. Due to a decline

in customer demand in some regions in Canada, CN

Railways recently suspended service between Williams Lake

and Squamish.

Airports remain open, but

domestic services, as well as cargo services, are

extremely limited.

Country not

on full lockdown, but

has issued stay at home

orders.

Chile

Borders to neighboring

countries are closed for transit of people but remain

open for the transfer of cargo with Peru, Argentina and

Bolivia.

All ports are closed for

entry/transit of people, but currently remain open for

import/export of cargo. Customs is working normally.

Freighter flights are

operational, but limited space and availability have

caused rates to increase.

Only some

districts are under

lockdown order.

Peru

All borders to neighboring

countries remain closed; exceptions only made for

goods movements. Domestic transportation is limited.

The majority of ports are fully

functional, but staff shortages at terminals are leading to

minor delays in handling operations.

All passenger air traffic is

suspended; only cargo aircraft is allowed to land.

Miami is used as a hub airport for supplies and all

foreign shipments.

Until April 26

(at the earliest)

USA

No restrictions on road freight as of yet. Borders to Canada

and Mexico remain open to commercial traffic for

essential goods

Ports are fully operational. Vessels are fully booked, and

new bookings require longer lead times due to increasing

numbers of blank sailings to/from the USA.

Airports are operating with limited capacity. Passenger

flights are mainly suspended; cargo flights

operational.

Several states have

issued stay at home orders

for the time being.


Asia


Country

Latest

lock-down

period

China

The restrictions for transports to and from Hubei Province

are being gradually lifted. Border crossing to Mongolia

has been opened. Borders to CIS and Russia

are partly open. Russia being in lockdown is leading to

severe delays at borders.

Ports are fully operational, but blank sailings and rotation

changes are delaying vessel departures and causing

equipment shortages. Up to four weeks prenotice for space

and equipment allocation on certain trades is required.

Airports are fully operational. Passenger

flights remain mainly suspended, but cargo flights

for PPE and essential items are soaring. Several airlines

are increasing freight services to and from China.

A minimum one to two weeks prenotice is required

for air freight arrangements.


earliest)

India

The lockdown has also led to

all states closing their borders, which has restricted

road transportation and led to a major shortage of truck

drivers, causing delays in the entire logistics chain.

Port operations have not been

officially suspended, but owing to restrictions on people’s

movement, it is becoming difficult to find manpower

resources.

Domestic and international

passenger flights have been suspended to any airport in

India. International cargo flights are permitted, but the

restrictions on people ’s movement are affecting

cargo handling operations.

Until May 3

(at the earliest)

Indonesia

The impact on road freight remains limited at this stage,

subject to sudden changes due to road closures by the

government.

Ports are fully operational, but blank sailings and rotation

changes are delaying vessel departures.

Several airlines have grounded most of their

aircraft fleet, heavily impacting cargo services

and air freight levels.

National disaster

declared until May 29

Japan

No restrictions on local transportation have been

issued yet. Many goods manufacturers have

suspended their production lines or reduced them due to

staff shortages.

All major ports are still fully operational; however, all trade

lanes are impacted in terms of their schedule, space and

rates. Port congestion in the entire Southeast Asia region is

increasing.

Cargo terminals are fully operational, but impacted

due to lack of space availability, reduced

schedules and an increase in air freight rates on all

trades.

State of emergency

declared until May 6 (at the

earliest)

Malaysia

Domestic transportation is still allowed but under strict

measures based on a classification system. All

goods need a permission letter from the respective

ministry (MITI). Checks under the Movement of Control

Order (MCO) are common. Cross-border trucking of

essential goods only.


and rolling of bookings due to blank sailings.


flights are mainly suspended; cargo flights

operational.


earliest)

Myanmar

Domestic and international

road freight is possible, but driver shortages are a

problem. Transit times are affected by night curfew from

10 p.m. to 4 a.m. in major cities, affecting the driving

transit time.

Ports are fully operational; due

to the high number of cancellations in March, some

carriers implemented late booking cancellation fees for

export.

Main airports remain closed

until April 30. No commercial flights in

operation, inbound or outbound. Only flights such

as for health aid supply charters or diplomacy flights

permitted.

Lockdown

measures in some

townships have been

introduced until further

notice.

Singapore

There are no bans on cargo trucking within Singapore.

However, due to less cargo in the market, subcontractors

have placed some of their staff on unpaid leave to save

cost.

Despite port operations still running, carriers are increasing

blank sailings and crews are not allowed to disembark.

Terminals are operating as usual 24/7. However,

passenger flights have been reduced drastically and a

significant portion of cargo space now occupies

passenger planes’ belly holds.

Until June 1 (at the

earliest)


South Korea

There are no specific restrictions for inland trucking

within South Korea.

All international ports and terminals remain operational. Port congestion is a factor leading to delays in the

berthing of container vessels as well as in container

releases from the terminal. Changes in vessel rotation are

leading to further delays.

The space situation is very tight as many airlines cancel

passenger flights. South Korea’s national airline is

deploying their passenger planes on cargo-only routes.

No lockdown in place;

South Koreans

slowly returning to

work

Thailand

All border stations remain closed to foreigners and only

allow passing of commercial trucking, diplomats, ship

crews, pilots, etc. Island of Phuket has issued

roadblocks preventing anyone from entering or

exiting the island via sea bridge, with the exception of

medical, governmental, construction and food trucks

and those with special permits.

Trade lanes most impacted are ports in East Asia. Feeder

ships have been canceling and rescheduling due to restrictions

and delays in other ports. There are empty sailings to

Thailand picking up single shipments. There are scares of

special equipment if trade continues at the slow pace.

There may be delays for berthing if a ship has

previously been quarantined.

Trade lanes most impacted are ports in East Asia.

Feeder ships have been canceling and rescheduling

due to restrictions and delays in other ports. There

are empty sailings to Thailand picking up single

shipments. There are scares of special equipment if trade

continues at the slow pace. There may be delays for

berthing if a ship has previously been

quarantined.

Curfew currently in

place; foreign visitors

banned from entering the

country until April 30 (at

the earliest)

Vietnam

Domestic transportation is currently operating as normal.

Cross-border and long-haul movements are unstable, and

trucking companies are reluctant to accept long-haul

cargo. Government has blocked the border road

between Vietnam and Laos, Cambodia.


and rate increases due to blank sailings.

A significant impact on rates and space is seen due to

major regional and international flight

cancellations that consist of nearly all air traffic. Limited

freighter capacity remains.

Systematic lockdown of

infected towns and

villages. Social

distancing advice in

place until further notice.


Middle East


Country

Latest

lock-down

period

Saudi Arabia

Currently, road freight is operation but with heavy

delays because drivers need to undergo COVID-19 testing

at the entry point before entry into the country.

Ports are operating normally, but due to nationwide curfews,

there is a shortage of labor, stevedores and customs

officials, resulting in delays. Temporarily, port free time has

been increased to 10 days from existing five days.


flights are completely suspended; cargo flights

operational.

Current nationwide

curfew is indefinite,

and no timeline has

been provided.

UAE

For trucking from/to the UAE, the majority roads are closed.

Only one border is open, on the road to/from Oman.

Transit via KSA has big impact on the delayed

movement.

Currently, ports are operational, there are blank

sailings, and feeder network within the region is stressed

due to road closures. A majority of cargo is being

diverted to short sea feeders; empty equipment is also a

challenge since carriers’ repositioning in the region is

slow. We have seen a decrease in

spot rates from China / Far East to UAE in the past week.

With Ramadan on the horizon, business activity is expected to

slow down further, and we may see a further reduction in spot

rates.

Most passenger flights have started to carry cargo only.

Validity of the rates is not provided by the airlines

since this might and can change without notice. UAE

National Airlines (EK/EY) have begun to take

bookings for certain sectors operated by their passenger

and cargo flights. Cargo freighters are still in demand

and have high potential rate fluctuation.

With the coverage of most of the passenger flights in

operation, we can see inquiries with certain

confirmations coming in, which is a positive sign.

All Emirates in the UAE

are under strict stay at

home orders until further

notice.

Oman

No restrictions on road freight

as of yet. Borders to UAE remain open to commercial

traffic, but we have seen slower clearance processes,

which is expected to be further reduced during

Ramadan.

Ports are fully operational.

Vessels are fully booked, and new bookings require longer

lead times due to increasing numbers of blank sailings

to/from the Middle East. Customs is working with

reduced manpower. Ramadan to start at the end of week 17,

which is expected to further slow down operations.

Electronic Delivery Orders have been introduced recently

by carriers.

Airports are operating with

limited capacity. Passenger flights are mainly

suspended; cargo flights are operational.

Only Muscat

under lockdown

until May 5, and several

police check points across

the country

Qatar

International road freight is not permitted due the

blockade and resultant restrictions.

Trucking within Qatar is so far normal, though a shortage of

trucks due to drivers infected with COVID-19 is an issue,

thus requiring advanced planning as much as

possible.

Ports are operational, with no impact as of now. Further

blank sailings are expected throughout April and into May.

Airports operational only for cargo. However, with the

limited options available for Qatar (on QR and TK), air

freight requires advance bookings, and rates are

volatile, as always subject to space.

No lockdown as of now;

offices allowed to

function with limited staff

numbers between

7 a.m. and 1 p.m.


Africa

Southern Africa

Branch operational, with personnel working remotely from home

The government of South Africa decided to implement a national lockdown for the entire country starting on March 27. This lockdown will end on April 30. All businesses, except those providing items for bas ic needs, security and medical care, are closed. If operations can be maintained remotely, this is permissible.

Domestic road freight is only allowed to move essential goods such as pharmaceuticals, food, coal and household goods, and only through transporters who are registered and hold a certificate to carry essential goods. As international road freight only, essential goods are permitted to be moved.

Other southern African countries are implementing different strategies to cope with the coronavirus impact: Zimbabwe The entire country has been in lockdown since March 30, until further notice, but will remain open for the transport of essential equipment. If South Africa suspends any truck movements via Zimbabwe, there may be too many police stops and additional costs. Botswana A 28-day lockdown has been put in place as from April 2. The country is allowing the flow of essential goods; however, individuals from high risk countries will be denied access. The Kazungula ferry crossing is currently problematic due to congestion and only one ferry running, along with high water levels so ferries can only work limited hours per day. DRC – Kasumbalesa/Lubumbashi A border closure of two days early last week was implemented in order to impose restrictions and protocols for drivers arriving into DRC. This led to long delays, since the 48 hours turned into almost three days. There is currently a 56-kilometer line for trucks trying to get to the Kasumbalesa border post. Zambia The country may impose a 14-day quarantine period on all foreign drivers. Tanzania The Tanduma border appears to be open for business. The government is hesitant to announce a full lockdown. Kenya The government introduced a daily curfew from 7 p.m. to 5 a.m. and checks at border crossings for all road cargo transport. Mozambique The government declared state of emergency for 30 days on April 1. All borders are closed except for entry of limited essential and medical goods. Borders are still operating normally with some delays.

Ports are only accepting essential cargo at the moment and requesting essential goods carrier certif icates. Ports are also operating on skeleton staff, which has resulted in some delays. All non-essential cargo is being taken to depots by carriers until after the lockdown period.

The majority of flights have been canceled, causing delays in receiving or exporting air freight cargo. Only essential goods are being allowed to be delivered, with clients being given the certif icate of “essential service provider” as well as certain ITAC permits, which are being required. Non-essential cargo is remaining with the handling agents.


For any inquiries, bookings and more information, please get in touch with your deugro contact or local deugro group office. They are available and ready to help.

https://deugro-group.com/contact/

Useful links The links below are for information purposes only. Number of confirmed cases worldwide

• https://coronavirus.jhu.edu/map.html Ocean freight – General updates

• www.seatrade-maritime.com

• www.tradewindsnews.com • www.xeneta.com/blog • www.theloadstar.com • www.worldmaritimenews.com • www.hellenicshippingnews.com

• www.lloydslist.maritimeintelligence.informa.com

Ocean freight – Global port restrictions map

• www.wilhelmsen.com/ships-agency/campaigns/coronavirus/coronavirus-map/

Ocean freight – Equipment availability

• www.container-xchange.com

Air freight – General updates

• www.aircargonews.net • aircargoworld.com • www.aircargoweek.com

• www.aerotime.aero • www.tacindex.com/

Oil and fuel prices

• www.shipandbunker.com • www.oilprice.com

Policy tracker of government responses • https://www.imf.org/en/Topics/imf-and-

covid19/Policy-Responses-to-COVID-19 Note: Data as of April 14‒21, 2020

‒ End ‒ Road transportation – General updates

• www.iru.org/

https://deugro-group.com/contact/

http://www.seatrade-maritime.com/

http://www.tradewindsnews.com/

https://deugro.sharepoint.com/sites/marketing/Shared%20Documents/www.xeneta.com/blog

http://www.theloadstar.com/

http://www.worldmaritimenews.com/

http://www.hellenicshippingnews.com/

http://www.lloydslist.maritimeintelligence.informa.com/

http://www.lloydslist.maritimeintelligence.informa.com/

http://www.wilhelmsen.com/ships-agency/campaigns/coronavirus/coronavirus-map/



http://www.container-xchange.com/

https://eur01.safelinks.protection.outlook.com/?url=https%3A%2F%2Faircargoworld.com%2F&data=02%7C01%7Cgiuliana.deferrari%40deugro.com%7Cc5b7c12c89aa470f44d908d7caa48a73%7Ccf8c5066ba21412da818bf950c01403f%7C0%7C0%7C637200680360178530&sdata=%2FYztjKMMWUvgPevhPcVkB79m%2FsoL%2FtFUgugfAOyKLnI%3D&reserved=0

http://www.aircargoweek.com/

http://www.aerotime.aero/

http://www.tacindex.com/

http://www.shipandbunker.com/

https://deugro.sharepoint.com/sites/marketing/Shared%20Documents/www.oilprice.com

http://www.iru.org/

Coronavirus (COVID -19) Impact · 2020-04-14 · Coronavirus (COVID -19) Impact Report Rev # 0...

Documents

Transcript of Coronavirus (COVID -19) Impact · 2020-04-14 · Coronavirus (COVID -19) Impact Report Rev # 0...