Containers are in short supply – what is important now

First Corona, then congestions at the ports, and a change in the flow of goods – worldwide, obtaining loading space in containers has become difficult.  Militzer & Münch has intensified cooperation with customers to meet the challenge by providing pragmatic solutions.

There are about 25 million containers in circulation worldwide, transporting about 90 percent of all merchandise traded[1]. But it is only now, as they are becoming scarce and freight rates are skyrocketing, that containers  are gaining the public’s attention.

Unpredictable dynamics – what caused the shortage

The reasons for the shortage are quickly explained: fewer containers were already ordered worldwide in 2019, a consequence of the trade war between the U.S. and China. With Corona the economy went into lockdown, fewer boxes were ordered during this phase as well. At the end of March 2020, more than four million empty 20-foot containers were stored at container manufacturers’ facilities and at Chinese ports – no one anticipated a shortage at that time.

Then economy started to pick up again, but not everywhere at the same time, and not in all industries to the same extent. The flow of goods no longer follows the familiar pattern, and containers have been piling up ever since at the ports where they cannot be handled because there are also fewer operational ships available. In rail traffic on the China-Europe trade lane, congested border crossings are currently complicating the situation. The problem is exacerbated by construction sites in the rail network and flooding, which means that wagons are not available on time either.

Container manufacturers are currently producing the coveted steel boxes at full speed. But the (shortage) situation is unlikely to ease in the coming months, hampering international trade and raising freight rates.

Militzer & Münch offers customers pragmatic solutions

“It is absolutely crucial that we inform our customers early on, in case there are deviations from the original schedule. Because for our customers, the situation is more than challenging”, says Holger Seehusen, Managing Director of M&M air sea cargo GmbH and member of the Militzer & Münch Group Management. “In order to find viable and sustainable solutions, our globally operating teams are cooperating even more closely with our customers, but also with all partners involved in handling the transport, to offer pragmatic and, above all, affordable alternatives.”

Comprehensive and real-time information

Missing equipment, overload at border crossings, or construction sites – when logistics come to a standstill, Militzer & Münch informs its customers promptly. Thus, there is still enough time to look for alternatives, as some deliveries simply must not be late.

Assistance in finding affordable alternatives

Then follows the search for feasible and affordable alternatives. “In consultation with our customers, we look for solutions on how to work around the bottlenecks,” says Holger Seehusen. “This includes finding alternative routes, modes of transport, and procuring equipment. Our big advantage: we can offer all modes of transport.”

New Militzer & Münch containers

Militzer & Münch has also increased its container stock: the Rail Segment, a business unit of M&M air sea cargo GmbH, has purchased a number of 40-foot containers together with Militzer & Münch China. Some of them got branded.

“Delays will not be entirely avoidable in the coming months,” says Holger Seehusen. “But our customers can count on us to do everything we can to mitigate the situation. This requires a lot of extra work from us, which we are happy to do to serve the interests and needs of our customers. Together, we can do it.”

 

 

[1] This and the following figures on the market situation are taken from Guillaume Dhamelincourt, Business Development – Product Specialist at JK Capital Management, a company of the La Française Group: www.institutional-money.com/news/maerkte/headline/schiffscontainer-knappheit-bedroht-globalen-handel-205915/