The strikes in Germany have slowed the processing of containers at the port, which has led to a pileup on the rails. The strike on the rails did not help the situation either. As a result, a snarled hairball of congestion slowed access to empty containers in the hinterland.
The CNBC Supply Chain Heat Map shows the sea of red. The congestion has created a two-and-a-half-month backup to the U.S. It has also hit the Europe-Asia trade route.
“The stressed situation for vessels waiting for berth and discharge is resulting in the lack of empty equipment availability in the hinterland, which will put further pressure on the equipment situation in Asia due to low backhaul activities,” said a reliable source from EMEA.
A supply chain in-transit visibility lead at MarineTraffic, said conditions in Hamburg, Germany, need to be monitored closely.
A worsening situation in Hamburg with close to 200K TEU [twenty-foot equivalent units] waiting for a berth indicates that waiting times will get higher in the coming weeks.
For the past several months, there were warnings about the availability of containers and how the congestion can only create a false container shortage. We have been here before.
This may not be a dislocation of containers, but the fact these containers are not moving easily is not good over the long term. While prices of containers may not go soaring, $20,000 plus the price of containers will not continue to drop as the supply of empties is landlocked in Europe. Blank sailings in Europe will only add to the capacity constriction.
A recent report on ocean freight spot prices stated, “Landside congestion and container dwell in port continues to haunt U.S. customers, halting the decline in spot rates.”
All the pipes of trade are connected. If one pipe starts to have empty-container constriction, container prices will be influenced across the board. The congestion is building exponentially on the East Coast in the U.S.