• In May 2010 the total value of UK’s trade-in-goods exported to Member States of the EU was £11.3 billion.
• As a comparison the total value of UK’s trade-in-goods exported to Member States of the EU in April 2010 was £11.6 billion and for May 2009 was £9.3 billion.
• May 2010 showed a 2.9 per cent decrease in exports compared to April 2010 and a 21.3 per cent increase in exports compared to May 2009.
• The total value of UK’s trade-in-goods exported for January 2009 to December 2009 was £124.2 billion, which has been upwardly revised by £48.5 million.
• The total 2010 year to date value of UK’s trade-in-goods exported excluding May was £46.2 billion, which has been upwardly revised by £273.6 million.

EU Imports

• In May 2010 the total value of trade-in-goods imported to the UK from Member States of the EU was £14.7 billion.
• As a comparison the total value of UK’s trade-in-goods imported to the UK from Member States of the EU in April 2010 was £15.3 billion and for May 2009 was £12.2 billion.
• May 2010 showed a 4.2 per cent decrease in imports compared to April 2010 and a 20.8 per cent increase in imports compared to May 2009.
• The total value of UK’s trade-in-goods imported for January 2009 to December 2009 was £162.7 billion, which has been upwardly revised by £238.0 million.

• The total 2010 year to date value of UK’s trade-in-goods imported excluding May was £59.2 billion, which has been upwardly revised by £96.7 million.

Source: Office of National Statistics 

As the peak cargo sailing season begins, operators admit they’ve been caught on the hop.Estimates from research company Tufton Oceanic suggest that 6 million new boxes are needed – that’s equivalent to two years of production.

Most of the containers on the high seas are made in China. But Tom Leander, editor of the shipping journal Lloyd’s List, says many manufacturers there are no longer geared up to respond rapidly to new orders. “The factories essentially closed and we think many of the workers were hired elsewhere for other work under the China Stimulus Plan,” he says.

“Then suddenly at the start of this year we saw a surge in volumes and the ship owners were taken by complete surprise. The fact that there are less boxes to ship has helped some freight rates to double since the beginning of the year.”

One of the world’s largest shipping lines, Maersk, insists it could not have forecast the turnaround – and admits things may get worse before they get better. “We ourselves have placed a very large order for 120,000 containers, but it will take a little while for the factories to get on line,” says Annemette Jepsen, managing director of Maersk Line UK.

“We have leased everything we can lay our hands on and we are also taking vessels out of lay- ups to feed the containers back to Asia to reduce the time they are tied up on land. It’s not a planning error – we just couldn’t have foreseen this.”

In some ways, operators have themselves to blame for their current predicament. Only a few months ago, the immediate future for the industry remained bleak.

Most saw little prospect of profits for as much as five years – and responded by ruthlessly cutting spare capacity in their container fleets. Now owners are trying to get back to the industry norm, which is having just over two containers available for every single slot on their ships.Much depends on the pace of orders for Christmas. Europe’s debt crisis and continuing spending cuts could yet slow future imports from Asia.

But as things stand, Maersk an all other major shipping line sees the supply of boxes remaining tight until at least the autumn.

Source: news.bbc.co.uk

Although the value of imports also dropped in January, the trade gap for goods increased from £7 to £8 billion

This brings into question the belief that the weak Pounds against other currencies would signal a boost to UK exports.

As reported in the FT.com web site he said that customers of shipping lines had created container shipping’s deepest crisis and contributed to persistent and damaging price instability in the sector.

Shippers had campaigned the EU to ban the conference system a move which Mr Aponte deemed as a “grave  error”. The removal of the conference system would “create instability in the future for the European and worldwide economy”

He maintained that the bigger operators would recover their losses in 2010 which does seem to indicate that the rash of surcharges - under whatever guise the lines name them – will continue.

At the first every bilateral EU – Morocco summit held in Granada South Spain last weekend it was announced that a long term aim was to set up a common economic area.

Spanish Prime Minister Jose Luis Rodriguez Zapatero, whose country holds the EU presidency was amongst those attending.

DAP UK is already handling volume cargo on both its overland and ocean routes into Morocco. We see this intended cooperation as a major step forward and opportunity for British exporters.

According to the Treasury, duty increases are ‘an important part of the deficit reduction plan’ but the RHA sees this as another easy option for the Government to hit an industry in which fuel is not only essential but necessarily used in vast quantities. Considering fuel duty is not only charged but then subjected to VAT the increase appears even more unfair to hauliers and ordinary citizens alike.

“Diesel is the commodity on which this industry is totally reliant,” said RHA Chief Executive Geoff Dunning. “We are already paying fuel duty rates that are up to six times higher than our European counterparts. If the Chancellor goes ahead with the 2.5 increase next month, it will mean that road transport operators will, on average, be paying an extra £1,100 per year in fuel duty alone, and that’s on top of the price of the fuel itself.

“Of course we understand that in order to regain economic stability, certain sacrifices have to be made but it seems grossly unfair that the UK haulage industry, the one sector on which the rest of UK plc is so dependent, should be the one to have its throat cut in this way. We need a Chancellor who is prepared to listen to and help this industry. Not one who seems hell-bent on driving it off the road completely”.

Source : Handy Shipping Guide

The Office for National Statistics have released figures which shown that British exports experienced in 2009  their the biggest fall since 1947 when records first began. Exports in total fell 9.5% in 2009 and leaves many wondering what happen to the increase predicted in government circles due to the weak pound against other currencies.

The recession also brought about  a reduction in imports of 10.3%. The figures from the O.N.show that for 2009 the UK’s goods trade deficit narrowed by £11.5bn to £81.9bn

December however showed that the country bought more overseas goods than it exported. This was due in the main to a large increase in the purchase of foreign made cars. This market sector showed that the imports of cars increased by £280m due to the governments scrappage scheme.  The figures suggest that foreign car plants are the real beneficiaries of the government’s scheme, and not UK-based manufacturers.

Another shot in the foot?

Now if we are  honest ourselves we all  understand and respect the need to trade profitably. Profit  isn’t a dirty word. Maintaining viability and profit levels funds new services, vessels and maintains service levels.

From comments we have received what appears to rankle most of our readers is the notion that the Lines were so busy fighting each other to maintain their own volumes and win new traffic flows that they lost all sight of what was  financially viable -sort of shipping line equivalent of irresponsible banker lending which caused the economic meltdown in the first place.

Most experienced operators in the shipping world knew rates were reducing to untenable levels. However no-one was going to look a gift horse in the mouth and most took advantage of the lower rates in order to satisfy their clients and to  maintain their own volumes and their market share.

So whose fault is it – the lines for offering uneconomical rates - the agents for taking advantage and at times exploiting the situation more under guise of working in their client’s best interests or a combination of both?The arguments are very complex and for obvious reasons vary depending on what side of the fence you sit. 

What is certain is the situation is not going to resolve itself overnight. However it is apparent from comments posted to us that whilst importers and exporters alike are trying appreciate the situation, their patience is being stretched by the constant drip of these additional charges. No-one can build customer confidence and long term relationships when month by month prices are escalating.  As one client put it to us “if I’ve got to pay more then say so – ONCE  – I’d rather one hefty increase rather then this consistant  spiralling we are getting now.”

We would be interested to hear what our readers think.

We would like to thank all those have have taken the time to comment on the blogs – its good to know you are reading them and please rest assured your comments and responses are valued.