Category Archives: Supply Chains

Maersk looks set to cut out freight forwarders to attract larger BCOs

Well, who would have guessed! Once Maersk built out its systems for booking shipments, it’s natural they would be cutting out forwarders. It’s what forwarders have been saying was going to happen for a while. and with Tradelens, Maersk can offer tracking, but also without involving forwarders.

This upstream cannibalism of customers may work for Maersk. They have worked very hard building their systems to make booking happen. And they are large enough to have a bit of market power over some forwarders.

But so much of all container lines’ traffic comes from forwarders. That part will go down, and more than it might, because forwarders will be bent out of shape and angry at having customers pirated.

I think it most hurts the littler guys, though, both forwarders and shippers.

But doesn’t Maersk have to focus on getting the ships to run on time? Blanking sailings and ships piling up outside ports are indicators of serious supply chain flaws. It would be more important for Maersk and other liner firms to do something about those issues.

Prices cannot continue to be through the roof as they are now, with containers not available or in the wrong place for cargo, or not being able to be moved, without crippling ocean container shipping in the long run.

By Nick Savvides 20/10/2021

Maersk looks set to cut out freight forwarders to attract larger BCOs – The Loadstar

President Biden challenges private sector to tackle supply chain logjams

Apparently the main action so far is to jawbone LA and Long Beach to open for more hours. The Executive Directors of the ports are in line with this.

But port governance gives them little actual power to open the terminals for longer hours. Ports are basically landlords, and have no operational control over the terminal operators, which are several different firms. It’s not clear what the Directors can do to change operations at these private firms.

Some announcements have been made, and it will be worth watching to see if any of the terminals do actually lengthen their hours of service. Doing so would help move cargo quicker, and that is certainly needed right now.

By Nick Savvides 14/10/2021

President Biden challenges private sector to tackle supply chain logjams – The Loadstar

OECD says shipping freight rates are driving G20 inflation

In case we didn’t notice it, shipping freight rate increases are the source of significant inflation throughout the 20 most developed countries. If you are complaining about inflation, point here.

The firms involved are passing the price rises on to consumers, resulting in higher prices. We may not be close to the end of the rises, either. We have not seen much to encourage a belief that the supply chain snafus will not continue and be disruptive for at least a year. No one seems to know what to do.

I fear even the choice of very large shippers to lease their own ships and avoid the traditional ocean container lines will not be all that easy. The extra ships will add to port delays, since they must load and unload just where the ocean shippers do. Ports are backed up, and also are running out of space for containers; and of course the driver shortage is preventing containers moving out fast.

Do we have to turn to rationing of scarce resources to get out of this dilemma, to make delivery predictable?

By Nick Savvides 13/10/2021

OECD says huge increases in shipping freight rates are driving G20 inflation – The Loadstar

Another source by Sam Chambers has some nice graphs: https://splash247.com/oecd-tracks-how-much-container-shippings-sky-high-freight-rates-are-contributing-to-global-inflation/