August 18, 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, with the spread of new mutations we do also see countries and regions hit by new waves of outbreak causing continuous impact on lives and businesses.
While improving, 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 and 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
Fairs, Events and Special Logistics
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.
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.
(Aug 17, 2021) – The airfreight market and dynamics are accelerating again as market demand continues to rise and supply chain levels are limited considering the availability of freighter aircraft and high cost related to Passenger Freighter Flights. Therefore, the market does remain congested as international long-haul passengers do not return into the market with another pandemic impact caused across various key economies. The dependency on airfreight freighter operators and flights therefore remains high with no larger increase in PAX flights in the coming months of 2021. Especially with the market heading into peak season the outlook therefore remains very uncertain how to manage the additional volumes without having to largely utilize high yield-based passenger freighters and cargo flights from commercial airlines. Considering the high utilization of freighter aircraft, this is the only possible solution to add additional capacity supply during the peak season.
Freighter aircraft operators therefore already started to conduct the required maintenance checks during the summer season. This will allow to deploy the full fleet during peak season to provide maximum capacity in the second half of 2021.
However, the market is expected to remain congested considering the large impact of mode shift from ocean to air. Especially with a continuous increase of critical shipments being converted to airfreight, there is a significant increase in large shipments in the market that requires access to freighter capacity. This will cause further congestion to the existing market imbalance of supply vs demand with no improvement in sight as the market is heading into peak season and an increase of consumer related product as well as strong demand in e-commerce.
Probably the most critical point in the supply chain therefore will be the reliability of the ground handling operations to ensure goods that are transported by airfreight are quickly turned around and made available to shippers. The situation in this specific aspect has recently been negative, impacted by increasing COVID-19 cases. The COVID-19 cases initially started to increase in key economies in Asia Pacific such as China and Vietnam but is now catching up as well in Europe and North America. This is likely to lead to further operational impacts and delays due to an increase of COVID-19 cases in the workforce of key handling areas and the logistic sector. In some markets, for example in the US, the situation is already rather critical as ground handling and warehouse capabilities are reaching the highest capacity utilization levels. A further negative impact on the operational situation in the US had the implementation of the new physical screening effective July 1 that is causing delays. All cargo that is transported on freighter flights are now required to be screened similar to freight that has moved on passenger flights. A large amount of freight is still handed over unscreened thereby causing delays of the throughput times.
Our DB Schenker own controlled network includes flights on following routes:
→ Fueled with SAF: Frankfurt (FRA) – Shanghai (PVG) – Frankfurt (FRA)
→ Beijing (PEK) – Frankfurt (FRA)
→ Chicago (RFD) – Munich (MUC) – Tokyo (NRT) – Seoul (ICN) – Munich (MUC) – Chicago (RFD)
→ Chicago (ORD / RFD) – Seoul (ICN) – Shanghai (PVG) – Chicago (RFD)
→ Frankfurt (FRA) – Beijing (PEK)
→ Frankfurt (FRA) – Mumbai (BOM) – Frankfurt (FRA) – Atlanta (ATL) – Frankfurt (FRA)
→ Frankfurt (FRA) – Chicago (ORD / RFD) – Frankfurt (FRA)
→ Frankfurt (FRA) – Shanghai (PVG)
→ Frankfurt (HHN) – Shanghai (PVG) – Frankfurt (HHN)
→ Frankfurt (FRA / HHN) – Zhengzhou (CGO)
→ Hongkong (HKG) – Chicago (ORD)
→ Hongkong (HKG) – Frankfurt (HHN)
→ Hongkong (HKG) – Los Angeles (LAX)
→ Luxembourg (LUX) – Indianapolis (IND) – Luxembourg (LUX)
→ Munich (MUC) – Chennai (MAA) – Munich (MUC) – Chicago (RFD)
→ Shanghai (PVG) – Chicago (ORD)
→ Shanghai (PVG) – Frankfurt (FRA)
→ Shanghai (PVG) – Luxembourg (LUX) – Shanghai (PVG)
→ Shanghai (PVG) – Singapore (SIN) – Sydney (SYD)
→ Zhengzhou (CGO) – Frankfurt (HHN)
→ Zhengzhou (CGO) – Amsterdam (AMS)
More detailed information on this new flight schedule can be found by clicking here.
(Aug 17, 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.
→ Please get in touch with your DB Schenker Account Manager for more information.
(Aug 17, 2021) - There is no reported impact on operations due to COVID-19, with status largely remaining unchanged.
We continue to closely monitor the situation in South-East Asia (Indonesia, Malaysia, the Philippines, Thailand, Vietnam), North-East Asia (Japan, South Korea) and Australia (NSW, Victoria, SA, Queensland).
→ Greater China update: Preventive measures aimed at curbing infections were announced at certain main gateway terminals in CW 32. Tightened management of ground operations for main gateways Beijing PEK, Shanghai PVG, Zhengzhou CGO, and several other surrounding airports continue.
→ Do reach out to your DB Schenker Account Managers should you require further details.
Some delays are 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.
→ To receive APAC daily customer advisories in your mailbox, please subscribe here.
(Aug 17, 2021) - Overall, DB Schenker’s air freight operations in the countries remain uninterrupted and we continue to serve our customers. For more detailed market updates related to Middle East and Africa, please click here (PDF).
No operational restrictions for air cargo business
Angola, Bahrain, Egypt, Kenya, Namibia, Mozambique, Oman, Qatar, South Africa, Saudi Arabia, UAE
(Aug 03, 2021) - Market situation remains challenging. Carrier capacity is still problematic on most trade lanes with continued strong and growing market demand. Widebody passenger aircraft are slow in returning to the market affecting options and pricing. In the USA specifically, there are increasing problems at airport terminals in handling and processing cargo. The terminal operational issues are severe and affecting both imports and exports. With Exports, the enhanced ICAO requirement for 100% screening that came into effect June 30, 2021, is worsening airport operations / terminals congestion. It is estimated that carriers receive less than 50% of freight (DB Schenker screens over 90% of cargo prior to delivery). There are related delays in delivering cargo, with long lines resulting in occurrences of missed ‘cut-offs’ and resulting in missed flights. Overall transit times and on time performance of airlines are affected. A lack of staff at handling agent and carriers is further complicating the USA market: A general labor shortage found in various sectors of the US economy.
With continued volatility in available capacity in the market, and challenges at the airport terminals, DB Schenker’s own controlled flight network both transatlantic and transpacific is providing secure space for our customers. Our airport-based offices are providing the necessary coordination to provide the fastest transition of cargo possible. Our Rockford (RFD) gateway is supporting our flight operations into the midwest / Chicago area and providing an excellent alternative. DB Schenker is now in a newly constructed facility ‘ramp’ side to the aircraft with 30,000 sqft (2.800 m2) of warehouse space.
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 to China (PVG). As part of its own controlled flight network, there are connections options via our European Hubs to India BOM and MAA. DB Schenker is as well adding ad hoc charters to Australia and Singapore to support customer demand for capacity.
USA – Asia (China Specific)
→ Strong 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 demand, with market backlogs affecting all major origins and destinations. Challenges related to freighter carriers schedule fluctuations continue. 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.
(Aug 17, 2021) – Global trade remains very strong, this is valid in particular for all trades ex and within Asia Pacific. All trades are expected to grow positively during 2021.
At the same time, the idle capacity remains almost nonexistent (currently at 0.7%) and more than 2/3 of the capacity to be released within 2021 has been phased into the trades already. Overall, the supply side remains limited to some 3% which leaves a huge delta between market supply and market demand and thus leads to a high-rate environment. After having dealt with the ripples of the Suez blockage, the situation around the COVID-19 cases now in Ningbo (recently in Yantian) adds up to the trades and tightens the bottleneck on equipment. Schedules in the main trades remain disrupted and reflect a capacity reduction of up to 25% weekly, through slid sailings, port omissions and other schedule recovery measures. The trades affected most are Asia to Europe and vice versa, but also ex Asia to NORAM and Europe to NORAM.
However, the space decline is followed by significant general market rate increases, peak season adjustments / introductions and similar. All main trades continue to show record rate levels, several trades have climbed further up and appear to reach their peak level during the current month of July while excellent utilizations of the vessels expected to last at least until Golden Week in October; some trades report already a strong outlook until LNY in 2022.
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 is globally short of 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).
(Aug 17, 2021) - All European Ocean Freight Branches are fully functioning operationally.
(Aug 17, 2021) - Notwithstanding the market situation as highlighted within Global Ocean Freight section, there are no significant COVID-19 impacted operations as status remains unchanged.
→ Greater China update: Following Ningbo Port Meishan terminal closure in CW 32 till date, the situation so far is stable and continues to be closely monitored as vessels are rerouted to other terminals to mitigate impact.→ Do reach out to your DB Schenker Account Managers should you require further details.
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.
→ Do reach out to your respective DB Schenker representatives for support or solutions where required.
→ To receive APAC daily customer advisories in your mailbox, please subscribe here.
(Aug 17, 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. For more detailed market updates related to Middle East and Africa, please click here (PDF).
(Jul 20, 2021) - A lot of pressure still ex South America for all outbound trades: Tight equipment, in particular, on the East Coast of South America, overly full ships. Pressure on allocation and equipment availability will continue in the coming weeks. Increased market demand for main commodities will continue, depending on the rate exchange which so far is looming a positive trend for exports in coming months.
(Aug 17, 2021) - Europe Land is fully operational and available for business, managing existing COVID-19 constraints in 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.
(Aug 17, 2021) - Some restrictions to contain the COVID-19 pandemic are continuing to be in place in some European countries and are in parts directly or indirectly affecting the transportation of goods. DB Schenker Land Transport monitors the situation closely and reacts specially 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 Land Transport 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.
(Aug 17, 2021) - Our Domestic Land product continues unabated to provide our regular high level of service. The situation in Malaysia, Thailand, Vietnam and other APAC countries is being monitored closely as the local situations could lead to delays.
Our Asia Landbridge FTL / LTL road service is running to schedule.
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. 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. 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
Forecast transit time (CY - CY) westbound is 20+ days and eastbound 35+ days
Forecast transit time (CY - CY) westbound is 25+ days and eastbound 35+ days
CN / KZ, CN / MN, CN / RU congestion > 7 days
Brest / Mala congestion range 7-10 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 3-7 days due to inspection.
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.
(Aug 17, 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.
(Aug 03, 2021)
→ USA: Fully operational.→ Brazil: Market is running in normal conditions. Border between Brazil and other Countries working in a reduced period of time with some restriction.→ Canada: Minimal changes in Canada, with provinces moving into more relaxed restrictions (increased capacity, non-essential retail opened). Expecting US – Canada Border to open up in Mid August to fully vaccinated US visitors. No carrier restrictions – capacity remains tight on LTL – particularly to / from western Canada→ Argentina: Commercial activities are working normally.→ Chile: Ports and warehouse near ports working over their 100% capability. This situation remains thesame since March 2021.→ Mexico: Fully operational. Capacity still remains tight on northbound transport industry wide.
(Aug 17, 2021) – While noticing different governmental restrictions especially in the APAC region, our operations and customer services remain stable worldwide. We continue monitoring the situation in all regions very closely and persist in prioritizing the protection of our staff and keeping our customers’ businesses running. Therefore, we focus on dedicated guidelines and preventive measures, e.g. social distancing, wearing masks, temperature control, sanitizing stations, enhanced cleaning on site, having office-based staff working remotely 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, to support 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!
(Aug 17, 2021) - All sites in our operations in Europe currently remain fully operational with precautionary measures in place for the health of workers.
(Aug 17, 2021) - There is no significant change in operational status for APAC countries generally from previous updates.
→ Greater China update: Despite increased infections rates in main port / airport areas in CW 32, the situation has stabilized. We continue to monitor the situation in affected areas.
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.
We remain vigilant in monitoring the situation, to mitigate events with potential impact to operations.
→ For India, please refer to our India website for detailed information via download.→ For most recent updates on Australia, please refer to our Australia website.→ To receive APAC daily customer advisories in your mailbox, please subscribe here.
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.
(Aug 17, 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.
(July 20, 2021) - 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. There is now country wide vaccine availability to help stop the spread in the USA.→ Mexico: COVID-19 numbers are still prevalent in Mexico. We are doing everything possible to minimize the impact to our personnel and facilities.→ Canada: 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 September 1 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.
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