Golden Week in China and UK port update

We would like to inform you of the upcoming Chinese Golden Week holiday, which will likely impact shipping schedules and your supply chain. Furthermore, we have an update on the Port of Felixstowe, which continues to cause problems and delays, and an advance warning of possible rising fuel prices in early 2020.

When is Golden Week in China?

In China, the National Day is held annually on the 1st of October celebrating the People’s Republic of China. This kicks off a week-long Golden Week festival, including parades, ceremonies, and other displays. In 2018 the Chinese Golden Week holiday will be held from the 1st – 3rd of October, with all DSV Air & Sea offices in Hong Kong and China closing during this time. Many factories will close for the extended holiday week, with operations resuming Monday the 9th of October.

How will Golden Week affect my supply chain and how can I prepare?

Traditionally the last two weeks of September is one of the busiest periods of the year, as suppliers rush to finish production and make pre-Golden Week sailings. Therefore, we recommend that our customers book their containers as early as possible, at least two weeks prior to vessel closing dates.
During week 41, the three shipping alliances have all announced several blank sailings, as the cargo volumes drop off. This effectively reduces capacity from around 275,000 TEU per week to about 140,000 TEU, around a 50% reduction in available space during the week commencing the 8th of October 2018.

What void sailings will there be?

Void sailing will affect UK services in week 40 and 41 as follows:
The Alliance FE2 loop to Southampton, Tihama 007W, ETD 1st of October ex Qingdao, Ningbo, Shanghai, Yantian and Singapore. The FE3 loop to London Gateway, YM Wind 008W, ETD 5th of October ex Hong Kong, Xiamen, Kaohsiung and Yantian.
Ocean Alliance AEU1 loop to Felistowe, OOCL Scandinavia, ETD 9th of October ex Shanghai, Ningbo, Yantian and Singapore. The AEU7 loop to Felixstowe, Thalassa Avra, ETD 9th of October ex Shanghai, Ningbo, Hong Kong, Yantian and Port Klang. The AEU2 loop to Southampton, CMACGM Zheng He, ETD 14th of October, Shanghai, Busan, Ningbo, Yantian and Singapore.
2M will temporarily suspend the AE2 loop to Felixstowe, MSC Reef, ETD 29th of September ex Qingdao, Busan, Ningbo and Yantian. This will remove 20,000 TEU capacity weekly from trade until further notice. Yantian will be added to AE1 loop and Qingdao/Busan will be served by feeders until further notice.

Update on the Port of Felixstowe issues

Further to our update in the last DSV newsletter, we are unfortunately still experiencing delays and problems at the Port of Felixstowe, after the troubled implementation of a new IT system two months ago. OOCL is the latest carrier to remove another service from Felixstowe to Southampton until further notice. This is further evidence that productivity problems and delays continue to plague the Port of Felixstowe, despite the port maintaining that the issues are improving and being resolved.

Additionally, driver shortages are adding to the problems at Felixstowe, with hauliers often being booked up two weeks in advice. DSV continue to request that our customers book deliveries with us at least 7 days prior to intended arrival of the vessel, ideally booking the delivery for day 5 or 6 after arrival as a buffer in case of vessel delay or slow discharge from the ship. While we will continue to endeavour to get your deliveries to you on the date and time requested, we ask for your continued patience during the delays at the port and UK road network.

Stricter sulphur limits – protecting the environment

Stricter sulphur limits on vessel fuel are coming into force from the 1st of January in 2020. The International Maritime Organization (IMO) will enforce a new 0.5% global sulphur cap on fuel content, lowering from the present 3.5% limit. The new lower limit on fuel sulphur is part of the IMO’s response to heightening environmental concerns, contributed in part by harmful emissions from ships. While no shipping line has yet made an announcement on what effect this will have on fuel prices, industry expert predicts it could add $175-225/TEU to costs on average. This may mean longer journeys, attracting even higher additional surcharges.

We will continue to keep you informed on industry news.