Tuesday, 12 March 2024 07:55

Shipping crisis deepens

Written by  Peter Burke
The shipping crisis in the Panama Canal appears to be deepening. The shipping crisis in the Panama Canal appears to be deepening.

The shipping crisis caused by Houthi rebel attacks in the Red Sea and problems with a lack of water in the Panama Canal appears to be deepening by the day.

Many of the ships heading to Europe with NZ produce are being forced to take the longer route around the Cape of Good Hope, adding an extra two weeks to the journey to some of NZ's major markets.

One of the companies affected is Silver Fern Farms and its GM sales, Peter Robinson, says they have been told that there appears to be no easy fix to the present situation.

"We've been told that disruption in the Red Sea area could continue for many months or even years," he told Rural News.

Robinson says shipping companies are passing on the cost of re-routing, resulting in additional supply-chain costs for product on the water. He says the Middle East is also affected, with the main port into Saudi Arabia in Jeddah virtually inaccessible. Instead ships are unloading at Damman Port in the Persian Gulf and carting containers inland an additional 1600km to their destinations, Robinson says.

"Empty containers must then be returned to Damman Port adding further costs to importers." 

Robinson says Silver Fern Farms (SFF) is closely monitoring timeliness of refrigerated containers due to longer journeys on land and sea. He says while it has successfully managed container availability so farm, they are advised disruption in this region could continue.

Robinson adds that SFF will continue to work closely with its global freight partner Kotahi, to ensure the product they work so hard to produce can make it through to customers in the UK, Europe and Middle East. 

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