ECA

We Must Keep Trade Lanes Open For All Participants

31.03.2020 Dianne Tipping

The Australian Federal Government, State Governments and Territories have taken a united stance and agree that all freight and logistics services (domestically and internationally) be designated as essential services and thereby supported and protected so that they remain open and working during the current lockdown status in Australia.

Many other nations have also committed to maintaining open supply chains despite COVID-19 issues including Singapore, Brunei, Canada, Chile, Myanmar and New Zealand.

Production in China has been increasing as the effects of COVID-19 has reduced. This has led to the reinstatement of sea cargo routes, in and out of China, and at the same time, the addition of services to reposition empty containers is being organised. Empty containers from China are starting to be re-positioned globally. This is happening slowly but very welcome to hear.

According to news reports, the Chinese Government has reduced checkpoints on roads so some motorways/highways are back to regular operations now. All provinces are trying their best to get back to normal production level, including Hubei province. Hubei province has started to release people to other provinces, however, most of the travellers are required to quarantine 14 days, before going back to the office or factory.

The Chinese Government is planning to totally unlock Hubei province around April 8. Most of the provinces in China have announced they expect business and lifestyle back to normal in 2-3 weeks. Currently, the average productivity in China is back to above 70%.

In Australia, vessels are arriving and sailing, however, the concern is airfreight. Global airfreight capacity has been minimal. This has been caused by the grounding of a large percentage of passenger aircraft. Whilst we still have charter aircraft and dedicated freighters these alone will not accommodate all the required movement of cargo.

The significant reduction in passenger air services has denied “belly space” for air cargo which is normally an important source of services. As a result, air cargo rates have increased significantly even while there have been delays against normal delivery times. Whilst many larger businesses have managed to secure arrangements for charters or use of passenger aircraft as cargo flights there are many SMEs out there that do not have the volume to justify such an outlay.

Austrade has engaged a consulting company to collate market conditions/concerns/feedback and provide recommendations for enabling the resumption and capacity for Australian air exports of perishables. Austrade has been at the forefront of assisting exporters through the COVID-19 crisis with its outreach and essential notices. Whilst we are very pleased that they are working on recommendations for export airfreight capacity to be supported for perishable exports the Export Council of Australia would like to ensure that all exporters have an opportunity to be included in these discussions.

The ECA would like to hear from exporters that are currently experiencing issues in moving cargo especially by air. Tell us if you are moving cargo, how difficult is to organize and other issues with this such as the costs etc. Please detail as much as you can so we can take your feedback to Austrade and other government bodies directly to ensure all exporters may have an opportunity to benefit from decisions being made. You can contact us here.

Freight services Industry body FTA Alliance has set up a COVID-19 Air Cargo Bulletin Board, where your freight forwarder can lodge a request for cargo space offerings/availability on import and export cargo needs.

Government, their agencies and the private sector have started planning for the end of the pandemic, looking at how trade can resume and what form it would take. Current events have highlighted the need to plan for other major interruptions to the international supply chain and establish strong business continuity plans. These are challenging times and the business community is leading by example, demonstrating our commitment to the community and our core business of keeping the economy moving.

 

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