Freight Broker Sees ‘Panic Mode’ Starting With Suez Still Blocked
(Bloomberg) -- A massive container ship blocking the Suez Canal is driving desperate shippers to consider moving more goods by air.
“You’re starting to get some people in panic mode,” said Michael Piza, vice president of corporate business development for Apex Logistics International, which brokers cargo by air, ship and truck. “We’ll really feel the full impact here in the next seven to 10 days.”
Even if the 400-meter (1,300-foot) Ever Given is freed up soon, the traffic jam in the busy maritime route will further strain global supply lines that are stretched as tightly as guitar strings. Caterpillar Inc., the maker of bulldozers and backhoes, is among companies suffering setbacks in delivery times.
Before the container-ship accident, Hong Kong-based Apex was expecting to fly 1,600 freighter flights this year, 400 more than in 2020. Now global demand for air freight is poised to spike even more.
“Capacity on the air-freight side is hard to come by to begin with,” Piza said. “Whenever you have issues like this, it’s going to create a real bottleneck and drive the freight prices really high again.”
It’s impossible for airplanes to soak up all the cargo carried by massive ships. Companies will now do triage on which supplies they need to move by air to keep operations going, Piza said.
The blockage of a major waterway is just the latest twist in a logistics market that has been upended for more than a year by Covid-19.
“You’re just not sure what you’re going to wake up to anymore,” Piza said. “The Suez Canal issue -- I didn’t see that one coming. I didn’t have that one on the bingo card.”
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