Welcome to insights for Freight Industry February 2024
In December, my colleague Peter and I flew into Mumbai to visit the India International Cargo Show, one of the biggest logistics fairs on the Indian subcontinent and where many of our agents from across India were exhibiting. It was the perfect opportunity to meet them under one roof – India is so vast that even with the best logistical ability (and contacts!), we’d struggle to see them all in one week.
The depth of trade both ways between the UK and India is already considerable, but with the impending Free Trade Agreement, levels are expected to increase significantly and quickly. When the FTA negotiations will be completed is still anybody’s guess.
One of the expected key winners of an FTA will be the UK’s automotive industry, a sector with which Espace and our Midlands region have a long and rich history. The International Automotive Technology symposium was held in Pune, India in January and resulted in an influx of enquiries for British businesses – proving the high demand for their world-leading technologies.
However, January also saw the suspension of two-year-old trade negotiations between the UK and Canada with both sides refusing to move on issues surrounding cheese and beef. The suspension impacts British exporters way beyond farming though, with British-made cars potentially priced out of the Canadian domestic market due to high import tariffs. Thus highlighting the delicate nature of trade negotiations.
International trade continues to be hampered by the ongoing and escalating Red Sea crisis. A swift resolution seems to be off the cards as tensions heighten between the US and Iran. The Suez Canal is a vital gateway for world trade. As it has been widely reported, shipping lines have diverted vessels around the Cape of Good Hope and will continue to do so until they can guarantee the safe passage of goods through the Red Sea.
With three boxes on board, our Worldwide team have been closely monitoring the EBBA Maersk which was forced about in the Red Sea in early January. It is now due to dock a full month after its scheduled arrival in Jebel Ali.
Once safe access to the Red Sea is restored, shipping lines face a difficult few months repositioning vessels and containers, meaning traders can expect hiked prices to continue well into the new financial year.
With issues on the water and prices rising, we have seen many clients revert to airfreight to guarantee the safe and scheduled arrival of their consignments from Asia to the UK and Europe.
The above image demonstrates perfectly how technology has revolutionised the logistics industry over the last ten years. We’re now well used to instant information on the whereabouts of our goods and the UK border is also experiencing its own digital revolution. The deadline to declare exported goods via the Customs Declaration Service instead of CHIEF is fast approaching. We’ve been working hard with our trade association BIFA and HMRC to ensure all parties involved in the cross-border movement of goods will be as least affected as possible. Look out for our “Indispensable 8” guide to CDS exports in the coming week.
The benefits of a digital border are many, not least for Border authorities who will be able to make data-based inspection of consignments and therefore a allow a quicker flow of goods. The need for traders to establish secure digital global supply chains will become apparent over the next few years with the introduction of our own Single Trade Window.
As it’s mid-February, I’ll leave you with my ode to logistics:
