Ipswich firm urges prime minister to address spiralling supply chain crisis
- Credit: PICTURE COURTESY OF THE PORT OF FELIXSTOWE
An Ipswich-based shipping agency is calling on the Prime Minister to intervene as freight prices continue to climb, causing problems throughout the supply chain.
Bosses at Cory Brothers said shipping a container from China to Europe in 2019 cost $1,300-1,500. In October 2020 it cost around $2,800. Then in November, it cost between $6,000-8,000.
At the end of May this year it cost $10,000-12,000. Now, it can cost between $18,000-20,000.
In response to the rapidly rising shipping rates, US president Joe Biden recently signed an executive order to crack down on anti-competitive conduct and high fees in the shipping industry.
Peter Wilson, managing director of Cory Brothers, said: "If Biden is sat at the table, Boris needs to be next to him.
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"It's to that point, is what we're saying. We, as freight forwarders, are getting nowhere with our conversations — in fact it's getting worse.
"All the risk is on us [freight forwarders], therefore we're saying that the United Kingdom have to reach out and have a discussion over how we're going to fix this."
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The impacts of increased shipping rates are being felt elsewhere in the supply chain.
Essex-based food wholesaler Chelmer Foods, said in a statement: "We have successfully mitigated the logistical impact to date, through careful planning and at enormous cost to our business.
"Although we continue to exercise this diligence to maintain an appropriate stock profile, you will further appreciate that this will also lead to a significant impact on our working capital requirement.
"Moreover, if we consistently bring forward and hold additional stocks, without a corresponding uptake by our customer base, this will ultimately lead to a sharp rise in finance costs, warehouse rental costs and critically, availability of warehousing space."
Mr Wilson said: "We're seeing it already.
"I know we're in July. But the reality is I'm going to start my Christmas shopping in August and make sure I've got everything.
"One because it will be cheaper. And two, because I know I'll actually have all my Christmas presents.
"This is not going away. This pinch and the consumer price point is going up, we're all starting to see it."
A spokeswoman for Number 10 declined to comment on whether the issue was something the Prime Minister would look into.
Instead, a spokesman from the Department for Transport said: “Resilient supply chains and free flowing freight are integral to the UK economy and we are working closely with the freight industry to work through the challenges some of the shipping companies are facing.
“This is not a problem unique to the UK, with shipping companies around the world experiencing similar container capacity issues.”