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Coronavirus Freight Impacts

Dear Valued Customer,

Following up on earlier released advisories, below is a general update addressing various transport modes and territories.

As most will know, the situation in China has stabilized and the wheels are slowly but surely turning again and cargo is flowing for ocean, rail, and air freight. Increasingly, focus had turned to Europe, South East Asia and the Americas where a similar situation is now unfolding as was seen in China when the outbreak was as its highest.

Overall daily business is under the circumstances running smoothly, and our contingency plan is in full effect. For further details on specific countries and mode of transport, see below:

The situation on airfreight is significantly more impacted than ocean freight due to significant lower capacity as a result of flight restrictions around the globe. This also impacts rate levels which remain very volatile and high. Demand out of Asia, and specifically China, is very high in order to clear backlogs from the lock-down.

Overall, we are in a situation where we can find the needed solutions and capacity to and from Asia, albeit with different routings, adjusted transit times, and subject to short term pricing.

With new measures implemented in the US and severe flight restrictions in place, new solutions including freighters are being put in place in order to meet demand. At TransGroup, we are a part of these efforts and remain committed to moving cargo to and from the US and will announce new solutions as they become available.

Ocean freight
The main challenge on ocean freight remains equipment availability as a large portion of the global container pool is not deployed in the needed locations as a result of improper re-positioning which have been impossible over the last weeks and months. Significant efforts are being made to evacuate equipment from the overflow regions to regions with shortage of equipment; however, a shortage of containers can be expected into April. Additionally, due to the reduced ocean volumes from China to the US, we are seeing some cargo handling terminals reducing their working hours.

Pricing remains volatile, given a significant imbalance between supply and demand. On top of that, emergency surcharges are implemented on specific trades, especially on export from Europe to Asia.

Overall the situation on ocean freight remains somewhat stable taking the situation into account and cargo is flowing.

Canada / US Border Closure
The United States and Canada will temporarily close its border to non-essential travel however this does not pertain to the transport of goods. Freight is expected to move normally during this border closure.

TransGroup Policies and Internal Updates
Yesterday, TransGroup sent out an update pertaining to our internal policies and contingency plans. We encourage your to read our policy to address any questions you may have.

All information is offered to the best of our knowledge and is prone to change. Should you require further information, please contact your local TransGroup station.

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