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Sea Freight Costs Increased After The Closure Of Land Borders

Published 01 Sep 2020

Sea Freight Costs Increased After The Closure Of Land Borders

Sea Freight Costs Increased After The Closure Of Land Borders

The Corona virus outbreak has also deeply affected the logistics industry. While 14 countries in Europe closed their borders for road transportation, there was a price increase of up to 40% in sea transportation.

The Corona virus epidemic, which started in Wuhan, China, started to increase its impact in many regions, especially in the European continent, since March. While the first of the measures taken by the countries was the closing of the border gates, this situation negatively affected the logistics sector.

According to the statement made by the online logistics platform Navlungo, it was noted that the shipping costs per container, which increased due to the low sulfur fuel application in maritime transport at the end of 2019, reached price increase up to 40% after Corona virus.


Urgent Orders Were Transfered To The Airline, Reservations Are Fully Booked By Mid-April

Isa Korkmaz, CEO of Navlungo, made evaluations on the latest developments. Korkmaz said, “The decrease in the cargo capacity due to the cancellation of the flights of passenger planes in air freight caused a 15-20% price increase in the air freight prices between Europe and America. Apart from the direct influence of China and Turkey by this situation, urgent orders will be transferred probably to the airway, which will lead to further price increases in the airline industry for a while." Isa Korkmaz also shared the information that reservations were filled on some routes until mid of April.


14 EU Countries Closed Their Highway Borders, 20% Decrease In E-Exports Expected

With the closing of the borders of 14 countries in Europe, delays in export loads started to occur, while freight increases by 15% were observed as a result of the trailers and containers that did not turn due to queues. As a result of people restricting their non-compulsory shopping in e-export shipments, there was a contraction in demand. Isa Korkmaz said that sales from e-commerce sites such as Amazon or Etsy are expected to decline by up to 20%, although the figures have not yet been revealed.


"Exporters Can Take Measures Against Corona Virus"

Isa Korkmaz stated that this extraordinary situation occured in trade due to corona virus, can survived with minimum damage only thanks to the measures to be taken and listed his proposals for companies who export from Turkey as follows:

Increase your alternatives: I suggest you to look for more alternatives while organizing your loads. You can make your freight planning by comparing sea, air and road options at the same time.

Be careful when making a reservation: There have been changes in the cancellation policies of many agencies due to space problems, be sure to accept this information when confirming your orders. Also, be sure to take into account potential delays in your contracts with your buyer and seller.

Prefer partial loads: You can distribute the risk by choosing partial freight instead of container or full truck.

Follow the developments closely: As a result of the Corona virus measures, we see that every day flight bans or border measures from each country vary. When planning your products, always get instant information from your logistics service provider.

Communicate more with your customers: Inform your customers frequently, and give the message that you are doing your best in possible delays and cancellations.