March 20^th 2020

Dear Valued Customer,

As we continue to monitor developments of the Covid-19 pandemic we would like to update you on the status of Trade Link’s operations and the key contingency measures we are taking to ensure the safety of our colleagues and the maintenance of our operations.

Our key contingency measures include:

• Ensuring all employees and agent teams are equipped to work from home in the event of office closures. Our global teams are working from home and office, enabled by shared IT-systems, processes and collaborative technology.
• Postponing all non-essential travel, customer visits and partner events.
• Keeping meetings virtual – in line with World Health Organization (WHO) social distancing guidelines.
• Developing business continuity and resource plans across our warehouse and distribution networks.
• Liaising closely with customers, suppliers, partners and colleagues in key territories to monitor and manage supply chain developments.
• Sanitising workplaces on a more frequent basis and communicating guidelines around safety/precaution.
• Closely monitoring all media and global reports to gather facts and insights on the current Covid-19 situation to support customer planning and decision making.

In close cooperation with our global partners, colleagues and carriers, we are navigating this unprecedented situation and proactively working on solutions to minimise and manage supply chain disruption.

Our operations in Canada and elsewhere continue unabated and your local team are working from home and office to ensure service continuity.  Our telephone lines are working as normal and remain the same, as are our email and online shipment tracking systems.

We are monitoring daily the impact Covid-19 is having on customer supply chains and the wider forwarding and logistics sector and you can find all our briefings and news articles available here.

Trade Link Regional Updates:

Canada / US

The Canada-U.S. border is closed to all non-essential travel in both directions and by mutual agreement is allowing trade routes and commercial channels to remain open.

Airlines, including Air Canada, are gradually suspending the majority of its international and U.S. transborder flights in response to decisions by national governments.

US and Canadian seaports have implemented protocols to maintain the health, safety, and well-being of employees while maintaining the essential functions of the Port.

Inevitably there will be capacity and transit delays across all transport modes, and we are working closely with our partners and carriers to mitigate supply chain impacts and implement contingency solutions.

China

With rates of new infections of COVID-19 continuing to decline in China, we observe China’s manufacturing is resuming across the region.  The consensus is that the worst has passed in China after two months of widespread quarantine.  Reports are emerging that the central province of Hubei are preparing to re-open their airports.  More port workers and truck drivers are steadily returning to their posts and cargo flow is easing up at the major ports.

As other countries struggle to respond to the growing pandemic, China is reportedly positioning itself as a leader and benefactor in public health.  In the last few weeks, China has donated coronavirus testing kits to Cambodia, sent planeloads of ventilators, masks and medics to Italy and France, pledged to help the Philippines, Spain and other countries, and deployed medics to Iran and Iraq – reports the Guardian UK.

China has ramped up production of N95 respiratory protection masks as part of its relief shipments to countries impacted by the growing pandemic, particularly as it sweeps across Europe.  China accounts for over 50% of world face-mask production.  When the crisis began, Trade Link managed the emergency transport of N95 masks from Canada to suppliers and partners in China.  This week, Trade Link are coordinating emergency air shipments of N95 face-masks and personal protective equipment from China to USA, Canada and Europe as those regions grapple to contain the crisis.

Air Freight

While capacity is still heavily impacted out of China, all airports are operating normally.  It is expected that space will get tighter towards end of March as factories production is ramping up.  Air cargo rates out of China have also spiked in recent weeks as a result of capacity being removed due to cancelled passenger flights and a backlog of ocean to air mode shipments.  We note industry reports citing price spikes of 40% over the last weeks, with some reporting more than 100% increases in the last few days.   Trade Link continue to work closely with our local China teams and carrier partners to monitor and mitigate capacity and price impacts.  Air cargo operations in Hong Kong, Japan and South Korea are operating as normal.

Sea Freight

Most, if not all, Chinese ports are operating normally.  The port of Wuhan is also gradually resuming operations.  Many sailings are still being blanked by the main carriers.  China to US and Europe container rates climbed between 8% -12% since last week.  As carriers announced additional GRIs for mid-April, it is likely that rates will continue to rise as backlogged orders are cleared over the coming weeks – according to industry reports.   Larger ships are expected to be deployed in April to meet the upsurge in demand.

Rail & Road

Market demand on rail solutions continues to capacity and train services have largely resumed operation across key stations, including Xiamen, Chengdu, Chongqing, Xian, Hefei, Suzhou, Shenyang, Changchun, Zhengzhou.  Trucking capacity is beginning to ease as drivers return to their posts and transport restrictions are gradually lifted.  In our update of March 5^th  we reported price increases from 20% to double, due to capacity constraints.  We continue to monitor capacity and price changes and expect recent increases to subside as capacity returns to normal levels.  There are capacity restrictions on rail services from China to Europe and many block trains are fully booked.

Europe

Our operations in Germany and elsewhere continue to function as normal and working within the evolving transport and extreme border restrictions.  The European trucking industry is facing severe pressure from a combination of demand/supply side factors and government regulation.  Many manufacturers have reduced production or shut factories completely, which has resulted in a significant fall in volumes for many carriers – reports Transport Intelligence.  Other sectors, notably grocery retail, medical and pharmaceutical, have experienced a surge in demand as consumers stockpile supplies.  The has led to short term peaks in demand for transport services.

The European Commission’s response to the COVID-19 pandemic prioritises keeping citizens healthy. This includes keeping essential transport moving, for example to transport medical supplies and other essential goods.  Many Member States have announced restrictions to transport – a full list by country is available here. 

Meanwhile, the United States announced travel restrictions on flights from Europe, including Ireland and UK since March 17, significantly impacting capacity and rates in both directions.

Other helpful updates and insights:

• Shipping Federation of Canada launches COVID-19 information compendium – a resource centre detailing measures implemented by Canadian authorities and various entities in relation to COVID-19 and international vessels operating in Canadian waters – read more. 
• EDC supports Canadian exporters as the Government of Canada commits $10B in support of Canadian businesses during health crisis – read more.
• ‘The big question on everybody’s lips is: how long will these major issues last?- Drewry Maritime Research business unit provide strong indications of the next phase of how the industry will respond to the crisis- read more.
• Chinese Port Restricts Ships from Virus-Hit Nations for 14 Days – read more.
• Demand is spiking for inland trucking capacity as grocers and retailers look to restock their shelves with critical goods amid the COVID-19 outbreak. DAT’s load-to-truck ratio, a measure of demand, was up 31% for vans and 33% for reefers between March 9 and March 15 – read more.

We will continue to provide updates as the situation unfolds.  If you have any question, please contact your Trade Link account manager, or send an e-mail to: load@tradelinkinternational.ca

Thank you for your continued support,

Your Trade Link Team