One of the most important changes we can expect to see in our industry in 2017 is further consolidation in the ocean freight market. With that comes some uncertainty, but we can expect to see a slight reprieve in increasing shipping rates providers have been experiencing since the collapse of Hanjin. While rates are not predicted to decrease substantially, stabilization should occur after Chinese New Year. However, providers can expect that once rates flatten, they will be higher than what we have experienced in the last year or more.
Unfortunately, Hanjin’s situation may not be an isolated incident. Logistics providers should learn from the Hanjin experience and readjust their risk management systems. Taking corrective action prior to a crisis can ensure that a customer’s cargo is not stranded on a container at sea. Providers should pre-emptively move shipments to more stable carriers.
In addition to rate increases, many importers have experienced delays and interruption of their supply chain as carriers experienced a capacity crunch. To manage delays, it’s essential that logistics providers work with their customers to ensure advanced booking of space by using the best forecasting tools for visibility and forward planning of weekly movements. Proper planning and forecasting is key to an uninterrupted supply chain.
It will also be important for the supply chain industry to monitor the political developments worldwide in terms of changes in regulations and long-term potential shifts in the manufacturing industry, which could impact trade.