Home » Technology » Crisis in the Red Sea has impacted global logistics

Crisis in the Red Sea has impacted global logistics

2024-03-15 21:10:20

The crisis in the Red Sea not only affects local transport in the maritime area, but also has a global impact on maritime transport and the supply chain, the knock-on effects of which are just beginning to manifest themselves. The diversion around the Cape of Good Hope has increased costs and delivery times for goods, affecting global shipping capacity and equipment availability on all trade routes, including a shortage of empty containers. In terms of Asia’s foreign trade, the Red Sea crisis not only caused delays on the Asia-Europe route, but also began to affect shipping capacity in other regions, with the greatest indirect influence being on routes from Asia to the United States. .

For Chinese ports, due to the corresponding decrease in shipment of goods due to the approaching New Year, this will have a relieving effect on the supply chain. In general, the crisis in the Red Sea has been prolonged, and its impact is expected to be in the process of gradual adaptation following adjustments in the industry. Therefore, it is highly likely that we will not see a situation of piles of empty containers like last year during the Chinese New Year holiday.

According to Chen Youwei, director of maritime transport at Robins International Freight in an interview with the China2Brazil portal, with the arrival of the Chinese New Year peak season and the recent crisis in the Red Sea, the shortage of containers is decreasing rapidly but can still meet the current demand. If the Red Sea crisis continues, containers might face temporary shortages due to ship diversions or disruptions to normal return routes.

In this interview, the general manager of the multinational logistics company Shanghai Dongqing Express, Liang Yanchang, also commented on how the diversion caused by the situation in the Red Sea, there was an increase in shipping costs and delays in arriving at the port, resulting in an extension of the empty container return cycle, which is leading to a rapid reduction in the availability of empty containers.

With the original excess supply reduced due to the situation in the Red Sea, a seasonal increase in demand following Chinese New Year is likely. Large companies such as Maersk have reserved empty containers for Chinese ports in advance. Since January this year, several cross-border e-commerce platforms in China, such as Alibaba.com, AliExpress and TEMU, have launched the “semi-managed” model to assist merchants in managing logistics fulfillment. This aims to improve efficiency and guarantee in order fulfillment.

For the industry expert Luis Felipe Campos, “the anticipation of a seasonal increase in demand following Chinese New Year highlights the importance of effective forecasting and planning in supply chain management. Companies that can quickly adapt to changes in the operating environment and implement flexible strategies will be better positioned to face challenges and seize opportunities.” This model allows merchants to save time and money by focusing on researching their own supply chain, including product and packaging cost-effectiveness, making their products better suited to market demands. For consumers, certainty in product delivery is a crucial factor.

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