Housewares is among the many industries that are being hit by soaring shipping costs and delays on Asia-Europe shopping routes. According to July’s Seafreight Market Update by Noatum Logistics, shippers may be paying 332% more per box than July 2020, while facing the ‘worst schedule reliability in the history of containerisation.’ In a series of feedback articles, HousewaresNews.net is asking for housewares suppliers’ views on the current freight challenges and its impact on the industry.
Eddington’s commercial director Richard Walker reflects on the current situation: “These are very challenging times with regards to freight and supply. Many Chinese factories are struggling to obtain adequate raw materials and have been overwhelmed with demand as they come out of lockdown. Sometimes they are working with Covid restricted work practices or have been unable to redeploy their workers which in turn impacts output.”
He reports: “We will have all seen in the press the recent Suez Canal blockage; we had containers on the vessel the Ever Given but we were fortunate to have had adequate stock cover the delay caused container. However, this helps illustrate the current challenges. The more recent temporary closure of Yantian port, the largest loading point in China, has compounded existing local Covid related delays meaning this has simply added to a backlog in the region. As of Tuesday (July 6), it was still only operating at 85% capacity.”
Highlighting the competition for space, Richard points out: “We’ve seen record levels on container prices this month with forwarders competing for limited space with the shipping lines which remain swamped with demand. Vessels are “cutting and running” from UK ports too where unloading delays mean it’s not always viable for ships to wait for the backlog of unloading to clear – they head to dock at Rotterdam or Hamburg with containers rolling back over to the UK by road at additional cost to us.”
“UK port clearance and unloading delays are also contributing to demurrage charges on stock we desperately need. This is, of course, not just affecting our sector, and I’m sure will lead to inflationary rises throughout the economy. There is no sign of rates abating this year.”
Focusing on Eddington’s strategies, Richard explains: “Eddingtons has been managing the unprecedented manufacturing costs by making shipments as efficiently as possible – often increasing quantities to fully utilise containers.”
He adds: “We are blessed with a high geographical spread of brand partners and factory production sites, so we are not totally governed by what is happening in China. We source many products from Europe, which travel to us by road with shorter lead times and many of our brand principles are in the US where freight rates have been less badly impacted.”