UNDER PRESSURE

Industry body highlights freight forwarders’ limits being stretched

The Customs Brokers and Freight Forwarders Federation (CBAFF) says freight forwarders across New Zealand are working tirelessly to minimise additional supply chain disruptions caused by the Omicron outbreak but they are under plenty of pressure.

CBAFF chief executive Rosemarie Dawson says consumers are understandably concerned about rising food costs and empty shelves in supermarkets – and logistics challenges contribute to that.

“The freight forwarding sector moves imports and exports around the globe and around New Zealand,” says Dawson.

“But it tends to be something of an ‘invisible’ industry, and it is important that people understand why moving freight is taking so much longer and costing more.”

New Zealand’s freight forwarding sector has been under considerable pressure since the global pandemic began to take hold in early 2020.

Kiwis’ online purchasing soared, resulting in a massive and sustained increase in the volume of freight arriving. There is an ongoing global shortage of shipping containers and hugely increased demand for container space. The CBAFF says freight costs have increased by up to 1000% and port congestion has intensified to the point that international vessels now often skip some NZ port calls.

“New Zealand’s Omicron outbreak has arrived into this very challenging scenario, already beset with delays and additional costs,” says Dawson.

“The sector was as prepared as it could be under the circumstances. Many freight forwarders have split their teams, with more working from home. Ports have been splitting shifts and have straddle carriers working in ‘bubbles’.

“Every part of the industry is doing their best, but every link is affected. In the North Island, particularly Auckland, the domestic supply chain is now painfully stretched.

“Ports of Auckland has had many staff sick or isolating, which has exacerbated congestion issues and more ships are diverting to Northport, near Whangarei.”

Dawson says that means longer journeys for trucking companies, who also have staff absent and may not be able to put all their vehicles on the road.

“There currently are not enough people in depots and warehouses to load and unload the usual volume of goods and it is now common for goods to take five days to travel from Auckland to Wellington.

“All this adds to pricing in stores. The longer freight sits and the longer it takes to deliver, the higher the costs. Importers have to pass those costs on to clients, who ultimately pass it on to consumers.”

Dawson says that, while the South Island has not yet been as severely impacted, CBAFF members there are also finding that moving freight is taking much longer.

“Overall, our members tell us that, after two years of challenges, most of their customers are now realistic about the delays. However, not all have changed their expectations. There does need to be good understanding, among customers and consumers that everything is going to take that much longer and will do for some time to come.”

THERE IS AN ONGOING GLOBAL SHORTAGE OF SHIPPING CONTAINERS AND HUGELY INCREASED DEMAND FOR CONTAINER SPACE. THE CBAFF SAYS FREIGHT COSTS HAVE INCREASED BY UP TO 1000% AND PORT CONGESTION HAS INTENSIFIED TO THE POINT THAT INTERNATIONAL VESSELS NOW OFTEN SKIP SOME NZ PORT CALLS.