Freight Update
Environmental Concerns
Wines from source are more than just a cause for supply chain concerns. A recent comment from the international Organisation of Wine and Vine (OIV) tell a sorry tale of reduced crops in both Italy and Spain. Along with France, Italy and Spain account for around 45% of the world’s production. This reduction in crop means the global wine production was below average for the third year running.
The environmental changes caused by global emissions are cited as one of the main reasons for these reductions. French wine regions suffered from a damp spring and early summer. In Italy a damaging frost in the early part of the year is seen as the cause of reduction in some regions, particularly those isolated from sheltering mountains or proximity to the sea.
Wines from the EU account for 58% of global production with Italy, Spain and France responsible for 79% of the EU wine production. Wines from the southern hemisphere now account for 23% of global production volumes. The industry view is that global production is expected to be down as consumption increases as expected. This will likely result in further supply concerns continuing into 2022.
Brexit Feedback
This is now a five-year-old story, but it is still impacting the logistics sector. The National Audit Office has reported that Brexit has caused a £17bn loss of trade between the UK and EU in three months. This is as a result of new costs and ‘red tape’ which has seen firms complete more than 48 million customs declarations and 140,000 export health certificates in the eight months after the UK left the EU.
Rail Freight
With the climate goals of the EU, combined transport is in the spotlight. It is the low-hanging fruit, the International Union for Road-Rail Combined Transport (UIRR) has repeatedly said, the solution to accomplish carbon-neutral transport. In 26th November RailFreight Live, three experts reveal how they are contributing to this common goal: Markus Bangen (CEO Duisport), Daniel Lebreton (VIIA) and Akos Ersek (UIRR).
DISRUPTED SUPPLY CHAIN THREAT
Supply chains continue to be the main cause for concern as the global recovery continues. With containerised freight costs expected to remain high over the next few months, consumers will find prices rising. This will be most evident with goods dependent on complicated and integrated supply chains.
According to the 2021 UN Conference on Trade & Development Review of Maritime Transport, the maritime sector will be changed in operations and structure by the continuing disruptions. Supply chain bottlenecks will continue; local and international restrictions on movements will impact supply chains with congested ports and delivery schedules dependent on the supply of containers and vessels. These issues have raised concerns over the future of long-distance supply chains, but it is unlikely to change the logistics industry in the short-term.
Longer term concerns over environmental and transport issues will impact the logistics industry and some goods will be more affected by rising freight costs. This will impact short-term the food and beverage sectors. This is the start of a change to global supply chain planning in light of the disruptions caused by the pandemic. What we are likely to see is more planning and dependence on alternative supply chain solutions.
