Congestion at ports should ease next year as deliveries of new container ships and shipper demand decline from the peak of the pandemic, but not enough to return global supply chain flows to pre-pandemic levels, according to the head of freight at DHL, the logistics group.
"Congestion will ease by 2023, but supply chain flows will not return to pre-pandemic levels in 2019," Tim Scharwath, freight director of DHL's global freight division, told the media. We cannot go back to the days of excess supply and very low rates. Infrastructure improvements in countries including the United States are not going to happen overnight because it takes a long time to develop."
Us ports are bracing for a surge in imports in the coming months, with shipments expected to approach the all-time high of 2.34 million 20-foot containers set in March, the National Retail Federation said on Wednesday.
Scharwath warned that congestion was worsening at major European ports such as Hamburg and Rotterdam as more ships arrive from Asia, and that a strike by South Korean truckers would strain the supply chain. He added, "No matter where you apply pressure in the world, it will have an impact on other parts of the supply chain. Five years ago, the situation in South Korea did not matter, but now it does.
Container shipping lines have been ordering new ships during the pandemic, as port bottlenecks have pushed rates to record highs and helped them post record profits after years of losses.
By the end of 2021, global container ship orders accounted for 9.8 percent of the world's existing fleet, about 6.5 percentage points higher than a year ago, the data showed.
On the same day, DHL announced that it would charge private customers more for parcels from July 1, as rising Labour and shipping costs made a rise in logistics prices inevitable.
DHL will raise prices by 1 euro to 3.50 euros for packages shipped abroad, but not to the United States. Packages shipped to the United States will nearly double in price, depending on the size of the package.
DHL said: "The company is only passing on some of the cost increases to its customers due to soaring air and partner fees." DHL added that even with the price increase, DHL's prices would still be lower than the average parcel price in Europe, based on prices announced by the network regulator in November 2021.
DHL, the logistics giant, reported a stellar performance in the first quarter of 2022, with revenue up 19.8% year on year to 22.6 billion euros. Profit rose 13% to 2.16 billion euros from 1.91 billion euros in the first quarter last year. International revenue rose 28 percent from last year to 17.12 billion euros.