Coronavirus disease 2019 is an infectious disease caused by severe acute respiratory syndrome Coronavirus 2. The UN Conference on Trade and Development (UNCTAD) is warning that the rapid spread of Covid – 19 could impact global GDP by unprecedented level causing harm to all nations .As the virus continues to spread, it remains immensely difficult to forecast the medium to long-term implications. Yet the short term consequences are clear: Demand and Freight rates will drastically vary. A range of manufacturing and non-manufacturing industries has been now suffering supply chain disruptions in some capacity due to Coronavirus related transport restrictions.
Shipping is responsible for 90% of global trade, has been sharply affected, and the effects of cancelled sailings and upended logistics are causing major issues in global shipping industry, such as a surplus of refrigerated containers stranded in China and short supply elsewhere. The industry will see a potential volume loss of 10%, equal to 17 million TEU globally. Freight rates will drastically increase as everything moves on freighter charter. While demand increases have bumped up air freight rates on bellyhold routes that remain open, and for freighter charter rates globally, further service cuts and travel bans threaten the future of many airlines.
Shipping is intertwined with dozens of other industries all around the world. Industries such as tourism, retail and transport will feel the short-term effect on the coronavirus whilst industries like consumer goods, raw materials and industrial goods will feel the of impact of the global epidemic in the long term.
It is imperative for everybody in the shipping and logistics industry to take care of themselves during the epidemic. Keep up to date with WHO notices and local government notifications and make sure precautions are in place so you and all others remain safe.