Navigating the risk of port congestion due to COVID-19
Ports are congested due to a backlog of cargo yet to be evacuated. Ports are classified as essential operations, however it is being significantly impacted by the COVID-19 pandemic and resulting partial economic lockdowns.
Due to non-essential sector lockdowns and uncertainty about the economic future, demand for consumer goods have declined with buyers reacting by either cancelling orders; scaling down size of order; or delaying receipt of consignment. In addition, warehouses are either full or closed, further contributing to the disruption of the supply chain including the flow of essential goods. The cumulative effect of which is increasingly congested ports with unevacuated cargo and queued up vessels.
While the Nigerian Ports Authority has suspended demurrage charges for an initial period of 21 days, it is imperative to proactively manage freight so as to optimise supply chain and minimize charges beyond the last free day.
In order to navigate and minimize the associated risks of port congestions on supply chain operations and costs, we recommend the following:
- Consult with your freight forwarder to access available warehouse capacity outside of port environs,
- Scout for and utilise alternative and less congested ports,
- Discuss with your freight forwarder the best way to track and minimise demurrage charges and
- Opt for slower vessel services, they are cheaper and help manage storage requirements.
It is more important now than ever to partner with an expert freight forwarder with the technology to optimise and expedite your supply chain. The team at OnePort 365 is always available to help answer any of your questions.
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