News / Empty boxes will be stuck in all the wrong places for new year peak

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Empty container shortages are expected following the delays and diversions in the Red Sea, which could have longer-term ramifications for the supply chain as it heads into Chinese New Year.  

Normal vessel rotations will nearly double because of diversions around the Cape of Good Hope, CEO of FreightRight Robert Khachatryan told The Loadstar. 

But the immediate rising rates and slowed transit time will only be short-term effects. 

Flexport, in its Red Sea update yesterday, advised that there would be “a lot of spillover effects, especially when it comes to equipment positioning”.  

It said: “Equipment deficits and congestion at ports are expected. Equipment shortage may hit Asia as soon as the second half of January.” 

Lars Jensen, CEO of Vespucci Maritime, warned: “We might have enough containers, but they might not be in the right geographical locations. Vessels bringing in empty containers needed for peak season in China will end up stuck in other places.” 

And intra-Asia vessels that do not have a port call requiring transit through the Suez Canal will still be hit with equipment availability issues, because ports such as Jebel Ali and Chennai are heavily reliant on equipment from services that typically transit through the canal. 

Flexport recommended that, to secure equipment and sailing loading, shippers book cargo four to six weeks before planned departure. 

It also suggested incorporating additional lead time into inventory planning, budgeting for an increase in transport costs, exploring alternative routings, modes and premium services and looking to logistics providers for updates. 

Logistics providers, carrier advisories, and government advisories were all listed as points of reference for shippers to monitor the situation. However, Mr Jensen said: “Carriers have been enormously slow with updates. 

“In this particular situation, there really is no other alternative to really breathing down the neck of the logistics provider you are using.”