May 11, 2021
Please find here the latest edition of our COVID-19 global customer advisory update. Thanks to growing vaccination coverage and decreasing pandemic impact, parts of the world are heading towards more regular conditions of business. However, the alarming news from India painfully remind us that the pandemic continues to be around to impact businesses and lives.
For the time being, the conditions under which we all operate will continue to be disruptive and far from normal. We look forward to continue our update services as long as the global pandemic influences the economy, hence our common business.
Please continue to be engaged with your DB Schenker Account Managers on your latest plans, prices and projections. They will invest the utmost effort to support your business with corresponding solutions.
Executive SummaryAir Freight
A peak in air capacity market demand of the vaccine distribution is expected to take place in H2 / 2021. We also see a shift in the projections related to exporting regions such as in the Americas where the USA may start exporting earlier than expected and therefore impacting specific trade lanes, such as USA to LATAM. Countries such as India are however expected to refrain from exporting certain medication produced in India as they see a resurgence of the COVID-19 pandemic on their population while remaining with Europe for the time being the biggest exporter of COVID-19 vaccines.
Various pharmaceutical companies have received emergency approval for COVID-19 vaccines. Further vaccines are in the pipeline or emergency approval has been requested already. With this acceleration of vaccines being approved in many countries we do observe an increase of COVID-19 vaccine production as well as required distribution. Countries that are today already involved in the healthcare sector are also highly involved into this increase in demand. This is a combination of either ingredients required to produce the vaccine or the finished vaccine itself.
Vaccine supply to the southern hemisphere is slowly showing some traction with humanitarian programs such as COVAX, GAVI or HOPE, however still at a much slower pace than expected. Even though shipments are limited, logistics challenges are far greater than in more developed countries as destinations are more difficult to reach due to extremely limited cargo capacity.
Based on these recent developments we do not expect major capacity challenges due to COVID-19 vaccine distribution in Q2 / 2021, but an increasing demand as of the second half of the year. All supply chain partners will be required to closely collaborate to support the distribution and mitigate potential negative impacts or disruptions through the end-to-end transportation.
For successful distribution, storage, repacking, and administration of a COVID-19 vaccine, additional medical supplies are needed – including needles, syringes, alcohol prep pads, surgical masks and face shields, gloves, mixing kits and additional PPE. Being part of our integrated end-to-end healthcare services DB SCHENKERlife+ with licensed and regulated facilities, alongside dedicated and qualified staff, we offer all conceivable warehousing services to handle medical devices and PPE, while supporting respectively institutions and industries globally.
(May 11, 2021) - The demand for airfreight remains critical during the pandemic as the market is growing month-on-month even after a strong Q4 in 2020 now also setting recording volume months in 2021 as shipper demand is peaking further. The shortage of supply is now overcome by additional passenger freighter flights leading to increasing cost in the airfreight market. The projection and forecast for 2021 remains on a very high level due to disruptions in other transport modes, leading to a strong shift from ocean to air to overcome supply chain disruptions and production line down situation or late deliveries. This situation is unlikely to change throughout the year. Therefore, the most crucial aspect in the current market remains access to capacity.
DB Schenker continues to expand the current own controlled network with additional ad-hoc flights supporting the tight capacity situation on key major trades. As the market remains congested especially on major trades, we are creating solutions that deliver additional stable capacity on major trade lanes for our customers in 2021 to support your business. Please reach out to your local DB Schenker teams and account managers to plan your volumes.
Our DB Schenker own controlled network includes flights on following routes:→ Fueled with SAF: Frankfurt (FRA) – Shanghai (PVG) – Frankfurt (FRA)→ Chicago (RFD) – Munich (MUC) – Tokyo (NRT) – Seoul (ICN) – Munich (MUC) – Chicago (RFD)→ Chicago (ORD / RFD) – Seoul (ICN) – Shanghai (PVG) – Chicago (RFD)→ Munich (MUC) – Chennai (MAA) – Munich (MUC) – Chicago (RFD)→ Frankfurt (FRA) – Dubai (DWC) – Mumbai (BOM) – Frankfurt (FRA) – Atlanta (ATL) – Frankfurt (FRA)→ Frankfurt (FRA) – Chicago (ORD / RFD) – Frankfurt (FRA)→ Frankfurt (HHN) – Shanghai (PVG) – Frankfurt (HHN)→ Luxembourg (LUX) – Indianapolis (IND) – Luxembourg (LUX)→ Shanghai (PVG) – Singapore (SIN) – Sydney (SYD)→ Shanghai (PVG) – Luxembourg (LUX) – Shanghai (PVG)→ Frankfurt (FRA) – Beijing (PEK)→ Beijing (PEK) – Frankfurt (FRA)→ Frankfurt (FRA) – Shanghai (PVG)→ Shanghai (PVG) – Frankfurt (FRA)→ Shanghai (PVG) – Chicago (ORD)→ Frankfurt (FRA / HHN) – Zhengzhou (CGO)→ Zhengzhou (CGO) – Frankfurt (HHN)→ Zhengzhou (CGO) – Amsterdam (AMS)→ Hongkong (HKG) – Chicago (ORD)→ Hongkong (HKG) – Frankfurt (HHN)
More detailed information on this new flight schedule can be found by clicking here.
(May 11, 2021) - All offices remain in full operation with access to terminal handling and ground transportation. All our European hubs deliver import and receive export freight with no backlogs recorded towards the weekend. Operationally, our linehauls to and from the hubs are running as scheduled. In some areas, our cross-border trucks might experience some minor delays.
→ Please get in touch with your DB Schenker Account Manager for more information.
(May 11, 2021) - There is no reported impact on operations due to COVID-19, with status largely remaining unchanged.
Since the last advisory from Apr 27, the situation in India remains serious with strict lockdowns and emergency measures in effect. Other countries in the region such as Japan, Malaysia, Thailand, the Philippines, Cambodia, Vietnam etc., are also reporting increasing trends of infection and are also being closely monitored with contingency measures being triggered where necessary. Singapore has also reinstated Phase 2 measures. Some delays may be expected. Our priority is still focused on the health and safety of our workforce, while mitigating the operational impact where feasible. This underscores the continued risk on operations and the vigilance necessary to cope with the ever-present COVID-19 situation.
Our air freight operations remain available to support customer needs. Control measures remain in effect. Delays / backlog may be expected in customs clearance and transportation. Alternatives to move / transport cargo via other gateways / routes are being established and stop-gap measures for labor / driver shortages are being deployed where necessary. Customers may contact the respective DB Schenker representatives for support or solutions if required.
Capacity is expected to remain volatile. We remain vigilant in monitoring the situation to mitigate events with potential impact to operations. Do refer to our Global Flight Network’s additional scheduled charter services for more solutions that can meet your needs.
(Apr 27, 2021) - Overall, the air freight operations in the countries remain uninterrupted and we continue to serve our customers. Only international passenger flights have been suspended in Saudi Arabia and Oman until further notice.
No operational restrictions for air cargo business
Angola, Bahrain, Egypt, Kenya, Namibia, Mozambique, Oman, Qatar, South Africa, Saudi Arabia, UAE
(May 11, 2021) - Continued strain on capacity on most trade lanes as market demand grows but passenger aircraft cargo capacity remains slow returning to compensate. USA import terminals are at times running behind in transitioning cargo affecting transit times. DB Schenker closely monitors airport operations to mitigate impacts to our customers; keeping them informed on status of any delays. With continued volatility in available capacity in the market, DB Schenker’s own controlled flight network both transatlantic and transpacific are providing secure space for our customers, and our airport-based offices are providing the necessary coordination to provide the fastest release of cargo possible. Our Rockford (RFD) gateway is supporting our flight operations into the Midwest / Chicago area and providing an excellent alternative.
Americas exports by trade-lane:
USA – Europe
→ Market demand continues moderate to strong from the USA. DB Schenker is maintaining its five 747 freighter flights per week as part of its Global Flight Operations Program. The flights are operating from Atlanta and Chicago-Rockford to Frankfurt and Munich, as well as from Indianapolis to Luxembourg. They offer DB Schenker customers a stable and secure access to capacity in what continues to be a volatile market situation.
USA – Asia (excluding China)
→ Capacity remains tight but on most trade lanes with critical situations remaining with destinations in Australia, Singapore and India. DB Schenker has large block space agreements in place to support these destinations from its key USA Gateways, as well as 747 freighter flight operations two times per week from ORD / RFD to Korea (ICN), that continues on to China (PVG). To India as part of its own controlled flight network there are connections options via our European operations to BOM and MAA.
USA – Asia ( China Specific)
→ Strong market demand to Shanghai and Hong Kong. DB Schenker as part of its own controlled flight network maintains 747 freighter flights from ORD / RFD to PVG, two times per week, providing a secure option to that market and surrounding cities.
USA – Latin Am / Latin Am to Europe and APAC
→ Intra-Americas: Capacity is in strong market demand with challenges related to freighter carrier schedules fluctuating and passenger flights continuing to be well below pre-COVID-19 levels. This situation is affecting all transit between North and South America as well as Central America.
→ Latin Am Exports: European destination capacity is tight with the market suffering backlogs due to limited freighter capacity; missing passenger aircraft space and continuing strong demand.
USA / Latin Am to Middle East / Africa
→ South Africa with continued strong market demand and shortage of capacity.
(May 11, 2021) – The global market supply and demand graph for 2021 shows an increasing imbalance in favor of the demand.
The annualized market demand is expected to be around 8 - 9% while supply remains unchanged at about 3%. Idle capacity is almost nonexistent and only few new buildings will come into the trades. The Suez blockage has resulted in heavy equipment deficits due to missing vessel arrivals and thus delayed empty equipment positioning. Schedules in the main trades remain disrupted and reflect a capacity reduction of up to 25 - 30% weekly, through slid sailings, port omissions and other schedule recovery measures. The trades affected most are Asia to Europe and vice versa, lesser impact ex Asia to NORAM and Europe to NORAM. However, in all trades rates have been impacted through general rate increases, peak season adjustments / introductions and similar. All main trades show record rate levels, several continue to climb up further. This overall tight situation is expected to last throughout May and June, some trades report already a strong outlook until Golden Week in October. Market rates are expected to stay high. Carriers focus on FAK segments and neglect special agreements as much as possible.
We strongly recommend most accurate forecasts for optimal allocation and uplift planning as well as preventing infrastructure bottlenecks (related to availability of truck, rail, barge power).
Schedule quality has been slightly improved during March to increase from globally 30 to 40%, global delay of vessel arrival is still around 6 to 7 days.
With fuel prices on the rise for IFO380 as well as VLSFO, the bunker adjustment factors have come into play from April onwards and causes rates to reflect related increases.
Import free time in all markets is generally cut down to zero since beginning of the year. The current circumstances make it very important for our customers to plan volume forecast (we advise 4 to 8 weeks in advance) and be flexible to re-route cargo (for congested destinations). Please expect the situation on all trades to remain subject to continuous changes.
With an uncertain outlook on vessel utilization and partly huge impacts on port terminals, we need to prepare for changing schedules and transit times, sudden / unexpected delays in uplift, increased bottlenecks of equipment availability, inconsistent departures and sudden surcharges possibly resulting in higher costs for the supply chain.
Our experts in Ocean will support and guide for→ SchenkerOcean strategic carrier partnerships to ensure access to equipment and space on all trades.→ Volume forecast and allocation planning: through access to volumes on all alliances and consultative volume planning (allocation match based on customer forecast) we ensure proper prioritization.→ Conversion from SchenkerOcean FCL to LCL to ensure uplift of faster required part loads.→ Resilient and sustainable shipping possibilities through mixed SchenkerOcean carrier portfolio.→ Various cargo storage options (using own or contracted warehouses and store goods accordingly to ease the rush of cargo at the same time).→ Use of inhouse options for airfreight, rail freight and combined modes of transport options.→ Alternate FCL shipping options via breakbulk (on multipurpose vessels).
(Apr 27, 2021) - All European Ocean Freight Branches are fully functioning operationally.
(May 11, 2021) - Notwithstanding the market situation as highlighted within Global Ocean Freight section, there are no significant COVID-19 impacted operations as status remains unchanged.
Since the last advisory dated Apr 27, the situation in India remains serious with strict lockdowns and emergency measures in effect. Other countries in the region such as Japan, Malaysia, Thailand, the Philippines, Cambodia, Vietnam etc. are also reporting increasing trends of infection and are also being closely monitored with contingency measures being triggered where necessary. Singapore has also reinstated Phase 2 measures. Some delays may be expected. Our priority is still focused on the health and safety of our workforce, while mitigating the operational impact where feasible. This underscores the continued risk on operations and the vigilance necessary to cope with the ever-present COVID-19 situation.
Our Ocean operations continue to be available to support customer needs. Delays could be expected in customs clearance and transportation. Stop-gap measures will be deployed where necessary.
→ Alternatives to move / transport cargo via other gateways / routes are being established. The ripple effect from the ‘Ever Given - Suez Canal’ incident is expected to have a prolonged impact on schedules and availability in Asia, over and above current challenges in the market. Do reach out to your respective DB Schenker representatives for support or solutions where required.
(Apr 27, 2021) - DB Schenker is fully operational and available to manage the current demand from customers even though an equipment shortage has been seen in the region.
→ Please get in touch with your DB Schenker Account Manager for the latest rates.
(Apr 27, 2021) - On the exports ex NORAM, it is worthwhile to mention that especially to Asia, the vessel utilization remains strong with no inflation of market rates expected. Void sailings and service suspensions causing severe shortage of space on all North American gateways resulting in high vessel utilization factors across the board. Roll-overs and yield management are being applied by carriers. Extra loaders deployed and services being reinstated on ad-hoc basis. Asia to North America is peaking further and bookings Asia to South America have come up massively during the past two weeks. We continue to monitor the situation.
(May 11, 2021) - Europe Land is fully operational and available for business, managing existing COVID-19 constraints in many European countries. Asia gives a heterogeneous picture with most countries fully operational and available for business while a few countries (such as India) are facing challenges, however operating. Asia Landbridge (China to South-East Asia) as well as Eurasia Landbridge (China – Europe Train) are fully operating, although facing congestions. Land operations in the Americas are also showing constraints, but still working close to normal.
(May 11, 2021) - General restrictions to contain the COVID-19 pandemic are continuing to be in place in several European countries and are in parts directly or indirectly affecting the transportation of goods. Currently, DB Schenker Land Transport monitors and reacts especially to border situations due to regulations imposed by individual countries. For any potential cases of disruptive conditions, we follow our pre-defined contingency plans to ensure flows of cargo as much as possible. In addition, we are adapting our transport service offerings daily to the needs of our customers.
Are you up-scaling or down-scaling your business activity in response to the changing market environment? DB Schenker Landtransport is your partner with one of the strongest and most resilient networks across 40 countries in Europe. Moreover, with our digital channels like connect4Land we offer a 24/7 entry point to our transport services, easy to use from everywhere, every time – Click. Ship. Done.
(May 11, 2021) - Our Domestic Land product continues unabated to provide our regular high level of service. However, recent outbreaks in India have created delays due to a dwindling workforce and high transit restrictions between states and territories. The situation in India is rapidly deteriorating and this could lead to more delays. New lockdowns and curfews in Malaysia and Thailand have had minimal effect on Land Transport operations.
Our Asia Landbridge FTL / LTL road service is running to schedule.
However, border congestion due to high market demand may add between 1 and 3 days to Asia Landbridge. A global demand for containers due to Ocean and Air capacity constraints continues to put significant pressure on road assets across the region. We are also still seeing the after-effects of the Suez Canal blockage and expect this to continue until the end of July. DB Schenker staff at Asia Landbridge border offices continue to ensure lead-times are minimized and service levels maintained through “triage” prioritization. Additional labor and associated domicile costs are still required to strategically avoid lengthy quarantine periods for our international drivers. A recent announcement from Savannakhét Provincial Governor mandates testing of Drivers crossing this area (at the Thai-Lao border). Therefore, additional costs are likely to be imposed on shipments traversing Savannakhét for the foreseeable future.
Our Domestic and International Land services continue to meet the high market demand and are strategically positioned to meet the forecast demand spike associated with ongoing reduced Ocean freight and Airfreight capacity. However, Customers are strongly urged to coordinate any volume spikes with their DB Schenker Account Manager as early as possible.
Congestion levels continue to fluctuate on our Eurasia service for Rail and Road. Please refer to table 1.
Low < 3 days, Medium > 3 days, High > 5 days, Extreme > 7 days
Forecast transit time (CY - CY) westbound is 20 to 25 days and eastbound 22 to 28 days.
Westbound container stocks remain low and are contributing to delays.
Xi’an’s EB booking for sanitary goods & Shanxi Province deliveries may incur additional 5 days due to inspection.
Unfortunately, additional costs relating to disinfecting cargo will be imposed upon the relevant freight payer or consignee for all eastbound shipments.
We therefore recommend checking estimated lead-times with your DB Schenker Account Manager.
(Apr 27, 2021) - Land transportation may be delayed in some countries due to additional checking. In some parts of the GCC, cargo movement has been restricted to food and essential items.
→ Please get in touch with your DB Schenker Account Manager for more details.
(May 11, 2021) -
→ USA: Fully operational.→ Brazil: Market is running in normal conditions. Border between Brazil, Chile, Argentina and Paraguay working partially with many restrictions. Commercial activities are working part time, and must be closed during the weekends (restaurants, shopping centers, etc.)→ Mexico: 100% fully operational.→ Canada: DB Schenker is fully operational. Lockdowns remain in effect in most provinces, with Ontario having all non-essential business shut down for 3 more weeks. This includes construction – only projects already underway could continue.
(May 11, 2021) - Our operations and customer services remain stable. While continuously and closely monitoring the situation in all regions, we persist in prioritizing the protection of our staff and keeping our customers’ businesses running with dedicated guidelines and preventive measures, e.g. social distancing, wearing masks, temperature control, sanitizing stations and respective controlling of health and safety regulations.
With our global healthcare quality framework, including regional and local competence centers, we support companies and institutions around the globe with handling of PPE and medical devices, successful distribution and administration of COVID-19 vaccines.
For short-term support we keep up our customer service offering:
→ In case you need temporary space, reach out to your DB Schenker Account Manager or local contact person!
(Apr 27, 2021) - All sites in our operations in Europe currently remain fully operational with precautionary measures in place for the health of workers.
(May 11, 2021) - There is no significant change in status for APAC countries generally from previous updates. Since the last advisory dated Apr 27, the situation in India remains serious with strict lockdowns and emergency measures in effect. Other countries in the region such as Japan, Malaysia, Thailand, the Philippines, Cambodia, Vietnam, etc. are also reporting increasing trends of infection and are also being closely monitored with contingency measures being triggered where necessary. Singapore has also reinstated Phase 2 measures. Some delays may be expected. Our priority is still focused on the health and safety of our workforce, while mitigating the operational impact where feasible. This underscores the continued risk on operations and the vigilance necessary to cope with the ever-present COVID-19 situation.
Tight controls remain in all other APAC countries with varying measures calibrated to the respective local situations. We remain vigilant in monitoring the situation, to mitigate events with potential impact to operations.
→ For India, there have been no significant operational updates. Please refer to our India website for detailed information via download.
While governmental imposed restrictions in APAC countries continue at varying levels, our service levels so far are maintained with our CL operations available to support customer needs.
Delays may be expected due to availability of workforce and enhanced strictly enforced hygiene and monitoring SOPs. Customers may contact the respective DB Schenker representatives for further support if necessary.
(Apr 27, 2021) - All DB Schenker contract logistics facilities in MEA are operational as per the appropriate health and safety standards and other regulations levied by the local government.
(May 11, 2021) - While observing COVID-19 infections across the region, our warehouses continue to operate with precautionary measures in place for the health of our people and hence keeping up our customer services.
→ USA: All operations in the USA remain operational with precautionary measures in place for the health of our people and delivery of services to our clients. We are seeing increasing cases of COVID-19 in the USA and remain very robust in our safety measures and protocols.→ Mexico: COVID-19 numbers are increasing in Mexico. Some states do require partial shutdowns of private life and economy in particular on weekends. We are doing everything possible to minimize the impact to our personnel and facilities.→ Canada: Expanded lock down measures Province of Ontario and Quebec. All Contract Logistics sites in Canada remain operational with health and safety measures in place for the safety of our associates and continued service.
DB Schenker is closely monitoring the COVID-19 situation. With precautionary measures in place, we are aiming to maintain full operability across all DB Schenker operations. In our offices across all continents, we have taken action to enable as many employees as possible to work from home to support the social distancing guidelines put in place by public authorities.
The next customer advisory will be the May 25 release or earlier should there be significant developments. Visit our website in advance to be among the first informed.
Thank you for your patience and support.DB Schenker COVID-19 Customer Advisory Team
We have used our utmost care in providing the information above. While the information above has been provided to the best of our knowledge and ability, the DB Schenker Group does not assume any liabilities arising from this information of the use thereof.