Coronavirus Disease 2019 (COVID-19) Update
October 28, 2020, 6pm (CET):
Updates in "Impact on Sea Logistics/Europe" and "Impact on Air Logistics/Europe".
OUR EMPLOYEES AND PREVENTIVE HEALTH MEASURES
The health and safety of our customers and employees remains our top priority. All Kuehne + Nagel offices have implemented actions according to recommendations from the World Health Organisation.
As regions differ in levels of spread and consequences of COVID-19, we adapt our business continuity measures accordingly. The Kuehne+Nagel commitment to operating under COVID-19 circumstances include responsibility on management side to have sites enabling social distance, staggered work schedules, safe commuting, frequent disinfection, cleaning procedures and more.
Our staff are successfully working from home where deemed necessary by local circumstances.
In regards to risk of virus on packages and pallets we receive and deliver, we deem the risk low, following WHO statement of "The likelihood of an infected person contaminating commercial goods is low and the risk of catching the virus that causes COVID-19 from a package that has been moved, travelled, and exposed to different conditions and temperature is also low."
BUSINESS CONTINUITY PROGRAM
As a global logistics company, we are facing supply chain disruptions on a regular basis. We adapt continuously our global standards of business continuity management and test our Business Continuity Plans addressing different crisis scenarios.
They are designed to protect the safety and wellbeing of our employees and to ensure an uninterrupted service for our customers. In respect of the magnitude of the COVID-19 effect, we are executing new and continuous risk assessments, business impact analysis and implementing new measures into our business continuity framework based on alert levels.
All countries have established national response teams in order to either prepare for, or execute activation of these plans.
Where deemed appropriate by our national management teams and where required by governmental decrees, we activate preventive measures and processes, which include temperature control of employees and visitors (within the parameters set by locally applicable laws such as data protection laws), self-declarations, segregated/flexi work arrangements, options to work from home, the sanitisation of our offices and sites, and the provision of essential hygiene products at workplaces. Standard processes have also been defined in case of staff being infected or exposed to people who are infected.
We are sharing hygienic guidelines with our suppliers to ensure greater awareness within the supply chain. Drivers arriving for collection or delivery undergo a briefing on hygienic best practices, and where permissible, are instructed to fill out self-declarations.
We have implemented global travel restrictions and external and internal meetings are either conducted as video conferences, or only in the presence of a small number of participants observing social distancing recommendations as issued by public health authorities.
GENERAL SITUATION IN OUR REGIONS
With ongoing COVID-19 related government regulations for travel and other challenges present, our focus in caring for our customers business has remained a primary focus and our logistics operations remain fully operational throughout Canada, the United States and Mexico. Protective measures are implemented within each of our North American warehouse and office locations ensuring the safety and health of our employees, contractors and business partners. As new challenges may arise, our team is also prepared with alternate solutions to keep business in motion.
South and Central America
We remain focused on taking care of our business and customers and our logistics operations remain fully operational throughout the region. In general, the ports are operational, but delays may occur in the terminals due to reduced staff, reduced attention hours and local quarantine measures. We see medium impacts on equipment availability – especially reefer containers. Brazil is still in partial quarantine, coming back in different steps according to the governments definitions. In the Andean region, the road logistics is also normal with restrictions in some areas with focused immobilization.
Overall the number of confirmed cases in Europe has slightly increased since July. Most countries show a positive trend, whereas in others governments defined severe measures to contain the spreading.
All Kuehne + Nagel sites established hygienic and social distancing rules to protect employees and business partners entering our facilities. Risk assessments are carried out on an ongoing basis and best practices are successfully shared and implemented within the organisation. A significant number of customers expressed their gratitude for the excellent service level offered despite the crisis situation and disruption of infrastructure in given markets.
With the re-opening of economy, there is resurgence of COVID-19 cases reported in some countries. Ongoing reinforcement of strict measures are re-introduced by different governments. We continue to remain vigilant on the situation and adjust our work arrangement accordingly without impact to business continuity. A calibrated and slow approach is planned for the return of employees to the workplace given the continuing volatile situation. At workplace, safe distance measures and other ongoing preventive measures are implemented to ensure a safe working environment.
Middle East and Africa
In varying degree, our colleagues are returning to the offices and/or warehouses under strict new procedures based on local risk assessments, capabilities and governmental advice. Countries are fully operational, with some delays and alternative procedures due to governmental restrictions.
IMPACT ON SEA LOGISTICS
The situation in each country is evolving daily as the authorities extend or relax restrictions.
In general, the situation has become more stable and predictable, and worldwide the effects of COVID-19 are decreasing from week to week. Equipment availability, available space, and blanked vessel sailings remain to have an impact on the overall situation.
Our local experts are at your full disposal to assist and support you with your specific requirements.
Our sea logistics operations are fully functional with minimal impact from having to work remotely. The main CFS gateways in US are operating normally but with reduced hours. Due to decreases in vessel operations some ports or terminals have reduced operating days or hours. However, cargo is still flowing into/in US and Canada.
Central and South America
There are currently no major restrictions on sea logistics operations. The offices are still handling business, but with reduced staff or in home office mode. The ports are operational, but delays may occur in the terminals due to reduced staff, reduced attention hours and local quarantine measures. We see medium impacts on equipment availability - especially reefer containers.
In Brazil, operations are running with only minor limitations.
In Argentina vessel operations are normal. The cargo-gate-process is normal with delays. The ports, customs and CFS work with limited staff.
Bolivia and Peru also instructed general quarantine, but resume everyday operations gradually. Still, delivery from ports is impacted, but the transport operations are regular. Transport operations also resumed on the Amazon River. In Chile, the government presented a five-steps plan to gradually relax lockdown restrictions in 12 regions in the country. Sea logistics operations are not affected. All ports are in operation, but there is some congestion - especially in the Port of Valparaiso and the Port of San Antonio.
Terminal, depot and CFS operations in China are back to normal. The arrival of large bulk carriers in China has returned to normal.
All Asia-Pacific seaports remain open and functioning normally, without significant delays or problems in cargo flow.
However, space and equipment are still under enormous pressure. We expect this situation to continue at least until Chinese New Year (CNY).
As world's key transhipment hub, the general surge in demand in the market in recent weeks has also put pressure on Singapore's terminals and related infrastructure - the port has been congested by the increasing number of vessel calls and the rising volume per call.
The demand for products from Asia increases dramatically as retailers continue to replenish their inventories. Empty equipment, especially 40ft HC containers, continues being strongly demanded in all Asian countries. As a result, customers have to deal with extended lead times within their supply chains as well as steep cost increases.
Moreover, the number of Covid-19 cases is again increasing in many European countries. Apart from several induced countermeasures such as restrictions in contacts, curfews or local lockdowns, some countries closed their boarders for tourists to contain the spread of the virus. Constraints for manufactures, like we have seen in the beginning of the year, have not been imposed yet. Operations in most European ports is working normal despite the UK where the port infrastructure in all major ports is heavily utilised and congested as a result of the strong volume development.
Middle East and Africa
In Turkey, exports and imports continue undisrupted for all stakeholders (ports, customs, carriers, customers and Kuehne+Nagel operations). Minor space and equipment issues are related to the increased business volume and are not due to Covid-19 restrictions.
In South Africa, there are currently no restrictions on the movement of goods no restrictions. The economy is essentially 100% open. A curfew for PPL continues to apply from 12am-4am. Port challenges still exist, but these are not directly related to Covid-19.
The ports in U.A.E are operating normally and do not face congestion or delays. Restrictions on domestic road freight have been lifted, except for light vehicles to and from Abu Dhabi and Al Ain. A Covid-19 test is required to enter the Emirate of Abu Dhabi. Independent of Covid-19, volumes are picking up. Equipment shortages and booking confirmation delays are expected to continue for the coming month.
IMPACT ON AIR LOGISTICS
After the passenger travel restrictions between Europe and the United States had been put in place in March 2020, the majority of airlines announced a drastic reduction of passenger flights offering limited capacity at market rates. Since the trade lane between Europe and North America is largely dominated by passenger aircraft, we have been experiencing a severe drop in the available capacity that still hasn’t fully stabilised, and is still well below 2019 numbers.
Restrictions on still existing non-essential activities do not apply to trade flows, and all our branches continue to operate in different models as regulations and infection rates dictate.
South and Central America
The situation in the region is gradually improving, with the majority of the countries releasing lockdowns. Carriers are starting to operate domestic flights and adding international flights to selected destinations. The overall operational status of airports, truckers and customs is stable, with all our Air Logistics branches reliably operating in a home office mode.
As virus surges, our air freight operations in Europe continue running smoothly, mostly in the home-office setup.The majority of destinations and markets are reached through freighters as passenger aircraft are still mostly grounded due to travel restrictions, quarantine rules and low consumer confidence in air travelling at the moment. We are right in the peak season – demand has increased and capacity is getting more and more short. In order to mitigate the capacity crunch Kuehne + Nagel has stabilized the air freight product portfolio for the months ahead to offer reliable airfreight capacity throughout the year.
Middle East and Africa
Capacity constraints are also seen in the Middle East and Africa region with all airlines still having suspended/reduced their passenger flights on the routings into the region. As per the UAE government’s directive, National carriers Etihad Airways and Emirates operate limited passenger flights to selected destinations. Cargo flights are exempt from this suspension and will continue to over a hundred of cargo destinations. Our teams continue working from home or operating in split setups in all countries, including countries experiencing a new spike in Covid-19 infections.
The overall operational situation in Greater China has returned to normal with limited impact from Covid-19. Due to the National holidays, the market is picking up significantly with the growing demand on high-tech, retail, PPE, e-commerce and vehicle parts. At the same time, the passenger flights have not been fully reinstated, increasing the demand on the available capacity for the next months to come. In South China carriers are resuming freighters to support hi-tech and e-commerce volumes that are increasing as well.
Pressure on capacity caused by limited passenger flight activity is seen in the majority of South Asia Pacific countries. Some countries face ongoing cases of COVID-19, which has led to further restrictions and partial lockdowns.
The majority of carriers still retain significant cuts in their passenger networks. In order to compensate for the shortage of lift on the main trade lanes, freighter capacity has significantly increased. We see that urgent air cargo demand for PPE has perished, the trend reflected by the reduction of the dedicated for the PPE passenger freighters.
Therefore, we expect there will still be a significant imbalance of demand and available capacity in the market in the months to come. We are working closely with our long-term carrier partners to have full transparency of the situation to address the needs and requirements of our customers.
Our Air Logistics teams are fully informed about the latest development of the situation, and we encourage you to reach out to your respective Kuehne + Nagel contact person for any further questions and any specific requirements regarding your airfreight shipments.
IATA's Airlines Cargo Operations Status page offers daily updated operational overview collected directly from IATA carrier members.
IMPACT ON ROAD LOGISTICS
We take this opportunity to thank our drivers, who are tirelessly collecting and delivering shipments under challenging conditions. We also extend our thanks to our customers and recipients of shipments who allow our drivers access to their restrooms. We truly appreciate those who go out of their way to help our drivers do a great job. By all of us working together and showing respect to each other, we jointly contribute to keeping our supply chains afloat.
Like European overland markets, the Kuehne+Nagel network is facing less restrictions compared to the spring period this year previous months. The development on an overall European scale however is still rather volatile and impacted by still existing Covid19 limitations in certain areas. This can lead to some partial reroutings and small delays in selected lanes. The current expectations for the next weeks force us to keep the following pre-conditions in place until further notice.
For any country in Europe, we still strongly ask shippers to check the availability and readiness of their customers to receive shipments during business hours, before handing shipments over to us. Shipments which cannot be delivered due to absent consignees will be returned to shippers at their cost. In case shippers are not able to receive these returned shipments, storage cost will apply.
In case of pick-up orders customers also need to ensure readiness of their pick-up addresses. If this is not given, cost of the pick-up attempts will be charged.
Further customers need to ensure that consignee’s will confirm receipt of cargo.
Trucking services in China are back to normal. Cross-border trucking to and from Hong Kong (SAR, China) has also resumed to normal operation.
The China/Vietnam border (Pingxiang border) is now operating as per normal. Operation at the Vietnam and Laos/Cambodia border as well as domestic transportation within Vietnam are also back to normal.
For Thailand, domestic and cross-border movement for commercial and essential goods between Thailand and Myanmar/Laos/Cambodia is allowed.
All drivers need to undergo health checks.
For cross-border trucking to Central Asian countries and Europe, there is congestion at China/Kazakhstan border (Horgos and Alashankou borders) due to the preventative control measures for COVID-19. Similarly, trucking to Europe via the China/Russia route (Manzhouli border) is also experiencing face the same issue due to the increased control measures implemented.
As of June 10, the Malaysian government has implemented a Recovery Movement Control Order (RMCO) until end of this year. Movement of goods in and out of the country must adhere to the RMCO standard operating procedure. We do not see any impact on domestic and cross border transportation.
The Indian Government has announced the Unlock 5.0 guidelines with effect from October 1. Several restrictions have eased out with the lockdown decisions to be decided by the state/provinces. This has no impact on domestic transportation.
The situation and border control measures in most of these countries are evolving rapidly as the COVID-19 situation continues to change. We are closely monitoring the situation and will provide further updates on this page.
US, Canada and Mexico border restrictions only impact "non-essential" travel and do not apply to the transportation of goods and services. Stay-at-home orders around the country are being lifted in some states and extended in others, however these measures are not directed at commercial truck traffic. Check with individual partners on their operation status prior to shipping because nearly all LTL carriers will be returning freight immediately (<1 day) after a refusal due to a closed consignee. Cargo cannot be held at the destination due to large volumes of undeliverable freight resulting in additional charges.
US domestic truckload capacity is tightening, but federal and state governments are committed to keeping the supply chain moving. The majority of LTL and Small package carriers will suspend physical signatures. In adherence to the “Social Distancing” policy, drivers will not be obtaining signatures from consignees. Drivers will record the exact time, note any exceptions and obtain the name of the person who is accepting the freight. As spot market truckload rates rise to highly affected areas, less drivers are willing to take loads into these areas forcing the ad hoc rates to climb. Urgent orders of retail goods drive rates up for van and reefer equipment. Retailers, including e-commerce outlets, rely increasingly on spot market providers to re-stock shelves immediately, while truckers report long wait times at pickup and delivery points.
ALTERNATIVE SOLUTIONS FOR SHIPMENTS
We remain committed to serving our valued customers. Besides working closely with carrier partners to provide solutions for urgent shipments, we have also activated alternative transport modes and route solutions to support your business needs.
Working closely with our key airline partners, our Air Logistics experts maintain regular space allocations on major Asian and Translantantic routes and have established additional weekly charter rotations to service both markets for urgent supply needs. A weekly fixed operating schedule and new charter movements on high demand trade lanes will help to avoid production and supply chain delays, and ensure the continuation of your operations caused by present and future implications of the „Coronavirus“ outbreak.
The impact of COVID-19 poses particular challenges for critical logistics needs in the healthcare, aviation or manufacturing industries. To expedite your deliveries, resolve transport delays and ensure the continuation of supply chain flows, Quick/Sterling, a Kuehne + Nagel company, is dedicated to offer you the time-critical solutions you need. Despite global travel restrictions, countries` lockdowns and exisiting capacity constraints, our expert teams are committed to support you. Do you have an urgent shipment? Contact our experts in time-critical logistics.
Kuehne+Nagel Sea-Air product, a combination of sea freight and air freight transport modes, helps to reduce costs, expedite your deliveries and ease capacity constraints whenever possible. We are operating several state-of-the-art Air freight hubs around the world to serve a large number of destinations by Sea-Air or Air-Sea in Asia, Europe and the America.
We offer KN Pledge for full sea container transport. It includes a guaranteed lead-time for your shipments with a money-back guarantee.
Customers can review in real-time, all available services, including regular service updates via our digital platform, seaexplorer. Seaexplorer enables customers to search for appropriate alternative service options in case of service disruptions.
Our KN LCL expedited service offers you an alternative for imports from Asia or Europe to the United States or vice versa with a faster transit time than regular LCL services: Using a direct route from the port of discharge to the customer location, which skips the inland CFS location, the Expedited Service is up to 6 days faster. For further information please contact your local Kuehne + Nagel office.
eShipAsia – our latest online logistics platform enables Intra-Asia shippers to optimise shipment based on the route, transit time and cost instantly. Its instant and competitive quotations provide full transparency on all applicable surcharges, meanwhile its advanced online track and trace features allow users to stay informed on their shipment status anytime, anywhere.
We have introduced the priority service "Reefer-Go" for time critical pharma and healthcare consignments that need to be loaded in south and central European ports according to a defined schedule. For further information, please contact your local Kuehne + Nagel reefer or pharma sea logistics team.
With short transit times and low freight costs our door-to-door rail service KN Eurasia Express provides you an optimal alternative transport mode for connections between China, Russia and Europe. Kuehne+Nagel works closely with all railway companies to ensure you maximum flexibility. Weekly departures are guaranteed from major terminals in China, such as Wuhan, Chengdu, Xi’an, Suzhou and Zhengzhou to destinations across Russia, Europe and vice versa.
Even though most borders in all affected countries are open for transport of goods, all shipments need special attention regarding export and import documentation.
Our customs clearance services are available and fully operational in all major regions. Customs authorities in all major regions are fully operational as well, although some ports may have delays due to reduced staffing potentially affecting inspections and other manual clearance processes.
Please see the following country specific customs websites for status updates. The situation remains fluid given the circumstances. We recommend that you regularly check for changes:
Check here for Europe, here for UK, here for USA, here for Canada and here for Mexico.
Please reach out to your Kuehne+Nagel representative for further guidance.
DISCLAIMER - All information is provided in good faith for guidance and reference purposes only. It is of a general informational nature, and Kuehne + Nagel takes no legal responsibility for the accuracy of the information provided via this document. Kuehne + Nagel makes no representation as to the accuracy or completeness of any of the information contained herein and accepts no liability for any loss arising from the use of the information provided.