BIFAlink is BIFA's monthly magazine covering issues of importance for the logistics and supply chain industry.
October 2021 The magazine of the British International Freight Association BIFA link Issue: 374 www.bifa.org
INSIDE
6: News France imposes 40-tonne limit for cross-border traffic 8: Policy & Compliance Boxship insurance claims continue to rise
Driver shortage impacts recovery Pages 10-11
14: Profile United Worldwide
Logistics won the 2020 BIFA Extra Mile Award
16: Policy & Compliance The cost of decarbonisation
17: Policy & Compliance What is sustainable aviation fuel?
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Robert Keen’s Column
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Whilst some people are confident that COVID-19 is under control in the UK due to the vaccination programme, there are also many people who are cautious about mixing in groups. At BIFA we had hoped to try some classroom training towards the end of the year, but there were only a few expressions of interest and we soon needed to use the trainers to fulfil online bookings, so this year training delivery has been totally online. However, we are planning to stage our annual BIFA Awards and lunch at the Brewery in London next January and current government announcements indicate this will be possible unless restrictions are imposed if there is a big rise in COVID-19 infections during the winter. Preparations for the event are well under way with a full complement of sponsors and it seems many people are looking forward to networking again. Our host for the awards is the Rugby World Cup winner Matt Dawson, a team captain on the TV show A Question of Sport for many years. Before then we have the Multimodal Exhibition at the National Exhibition Centre in Birmingham. The show has been postponed a couple of times but is now going ahead between the 19th and 21st of October. We had been reticent to commit earlier but now we are confident that there is an appetite for people to emerge from interactions via video conference to meet once again in person. This year there is a freight forwarder village at Multimodal with many BIFA Members trying a new innovation by the organisers of ‘pods’, giving people the chance to be part of the exhibition without the outlay of an expensive stand. BIFA will have a stand at the centre of the freight forwarder village and the plan is that I will be there with colleagues Carl Hobbis, Liz Sumner, Sharon Hammond and Robert Windsor. BIFA will be participating in some of the panel discussions as usual. Full details are on the Multimodal website and as well as being able to register to attend there is a section detailing how the organisers are making the venue as safe as possible to visit. Our traditional format of interest groups in port communities and geographical forwarder clusters has been affected by the pandemic but we have continued to hold meetings via video conference. We will look to return to physical meetings in 2022; however, we are continually discussing how we interact with BIFA Members. There was a mixed response to a recent survey I undertook with BIFA Members from the Midlands up to the Scottish Border; some have indicated they would like regional meetings to return but equally there have been some reservations expressed. I believe we will need to take different approaches across the UK so that we do not lose existing local relationships, but we reach out to reflect the wider spread of logistics companies outside of traditional BIFA communities. Turning to online communications, we were pleased to host over 300 BIFA Members to our recent webinar ‘EU Exit – Unfinished Business’, where the next steps that were due to be implemented from 1 October were outlined with presentations from HMRC, DEFRA and the Port of Calais. The webinar had been some weeks in planning but as readers will know, the government announced a revised timetable less than 24 hours before our start time. We will be communicating feedback from HMRC and DEFRA to the many questions that BIFA Members raised. Lastly, a sales plug for our new Customs Declaration Service (CDS) online training course, which has recently been launched. As we all know, CHIEF has been around a long time for a computer system but now has less than 12 months to run on imports, although exports will remain until March 2023. Full information is available in the training area of www.bifa.org With Christmas on the horizon, I send best wishes to all Members that are active in managing supply chains connected to the festive period and hope they can overcome the enormous challenges that they face to ensure that the prophets of doom are proved wrong, and Christmas is not ‘cancelled’. Meeting with BIFA again after COVID-19
BIFAlink is the official magazine of the British International Freight Association Redfern House, Browells Lane, Feltham TW13 7EP Tel: 020 8844 2266
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Director General Robert Keen r.keen@bifa.org Executive Director Robert Windsor
r.windsor@bifa.org Executive Director Spencer Stevenson s.stevenson@bifa.org Executive Director Carl Hobbis c.hobbis@bifa.org Policy & Compliance Advisor Pawel Jarza p.jarza@bifa.org Policy & Compliance Advisor David Stroud d.stroud@bifa.org Editorial Co-ordinator Sharon Hammond s.hammond@bifa.org Membership Supervisor Sarah Milton s.milton@bifa.org Published by Park Lane Publishing peter@parklanepublishingltd.com Contributors
Robert Keen, Robert Windsor, Pawel Jarza, David Stroud, Spencer Stevenson, Carl Hobbis, Sharon Hammond, Nezda Leigh
Note to media: If you wish to use items in this magazine that are older than 1 month, please contact the editor to ensure that the item in question still reflects the current circumstances. Please be advised that BIFA DOES NOT OFFER LEGAL ADVICE. BIFA is not a law firm and the authors of this publication are not legally qualified and do not have any legal training. The guidance and assistance set out herein are based on BIFA’s own experience with the issues concerned and should not be in any circumstances regarded or relied upon as legal advice. It is strongly recommended that anyone considering further action based on the information contained in this publication should seek the advice of a qualified professional.
Robert Keen Director General
October 2021
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Ian Matheson, from Impress Communications, reviews some recent news that might impact on Members’ business
IN THE AIR Global air cargo markets saw
continued strong growth in demand in July, up 8.6% measured in cargo tonne-kilometres (CTK) compared with July 2019, according to data released by IATA. Overall growth remains strong compared with the long-term average growth trend of around 4.7%. Mammoth Freighters LLC has launched a business that will convert used Boeing 777s into all- cargo planes that can carry heavy
containers on the main deck instead of passenger seats.
Global regulators hold liner shipping talks
ON THE QUAYSIDE The Port of Calais has inaugurated a €863 million infrastructure extension that aims to significantly facilitate the transit of freight and passenger traffic. Three ferry stations will be created with ‘floating gangways’, allowing passenger and heavy goods vehicles to be loaded and unloaded on four lanes simultaneously, compared with two previously, offering a time saving of 30% per stopover. Ever Ace, which is claimed to be the world’s largest containership with a nominal carrying capacity close to 24,000 teu, made its maiden call at the port of Felixstowe in mid-September. It is the first of 12 sisterships ordered by Evergreen, each 400 m in length,
ON THE OCEAN Maritime regulators from the EU, US and China met virtually in September for the fifth biennial meeting of the Global Regulatory Summit to discuss competition issues related to liner shipping. They focused on sectoral developments, actions undertaken so far by relevant jurisdictions and authorities in response and their results, as well the way forward and possible actions to increase resilience and smooth operations in the sector. New analysis from Sea-Intelligence shows fierce competition for market share between the world’s three global east-west alliances. Since the start of 2020, 2M – the Maersk MSC grouping – has lost capacity market share to the Ocean Alliance on the Asia-North Europe trade and to both the Ocean Alliance and THE Alliance on the Asia-Mediterranean trade, it added.
Carriage of Containers provides operators with pathways based on analysis and a thorough understanding of safety, regulatory and operational requirements. According to Sea-Intelligence, niche container lines have been better at navigating the COVID-19 pandemic in terms of schedule reliability than the segment’s 14 major shipping lines. They consistently achieved better schedule reliability, by 8% and 11% in June and July, respectively. The accelerating adoption of e-bills of lading and the enabling legislative framework has ramifications for shipowners and insurers. Whilst the disadvantages of relying on paper-based processes to regulate the delivery of cargo from a ship are well known, the increasing use of digital processes exposes carriers to greater cyber-security risks, including the risk that data is compromised or lost. GOING OVERLAND Following a successful nine-year trial and consultation, the Department for Transport will now
consider the use of longer semi- trailers (LSTs), which can be 15.65 m in length, on Britain’s roads outside trial conditions. The more environmentally friendly vehicles could be rolled out sometime in 2022, with estimates suggesting LSTs could remove up to one in eight freight journeys by carrying the same amount of cargo in fewer lorries. Industry commentators appear united in the view that short-term visas for foreign drivers will not solve the UK’s HGV driver problem
and have called for greater recruitment of women and a
61.5 m in width and with a maximum cruising speed of 22.6 knots. IN BUSINESS The Confederation of British Industry said that it could be another two years before the
reduction in the minimum age for obtaining a licence as better long- term solutions. Meanwhile the government announced a series of measures aimed at increasing HGV driver testing capacity. A new unaccompanied cross- Channel freight service managed by Eurotunnel Le Shuttle Freight was launched in mid-September. It operates 24 hours a day, six days a week from the group’s two terminals in Calais and Folkestone, with a capacity of 8,300 trailers per year.
ongoing labour shortage impacting UK supply chains and productivity is solved. It added that while it was “right” that the government wanted to develop the skills of British workers, short-term targeted interventions and solutions were needed to help companies now, as the current labour system is unable to respond to their needs.
Ship classification society Bureau Veritas has developed a formalised
approach to support the safe carriage of containers in bulk
carriers. Its Guidance for Studying and Preparing a Bulk Carrier for the
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October 2021
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Air Ocean Road Imports Exports ustoms declarations Worksheet automation Customs eTariff CFSP management Customs Warehousing Duty management Transit (NCTS) management Transit (CT) Guarantee management Import ETSF management CCS-UK electronic fallback Export DEP management Job costing and invoicing Air waybills and eAWB Bills of lading Barcoded cargo labels Consignment security declarations Collection and Delivery notes Consolidation management and Manifests eDocument management Archiving Limitless integration Limitless automation
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France imposes 40-tonne limit for cross-border traffic
CTU Code Quick Guide is now available in all six official IMO languages In striving for greater awareness and usage of the CTU Code in order to improve safety in the intermodal supply chain, the Cargo Integrity Group (CIG) has published its Quick Guide to the Code, and its accompanying Container Packing Checklist, in Arabic, Chinese, English, French, Russian and Spanish. The five organisations collaborating in CIG are dedicated to achieving greater levels of safety, security and environmental performance within containerised global trade. The production of a Quick Guide to the IMO/ILO/UNECE Code of Practice for Packing of Cargo Transport Units (CTU Code), along with a checklist of actions required by those packing cargo in freight containers, is pivotal to achieving safe and secure transport. Now the Quick Guide and Checklist have been translated from the original English into each of the other United Nations official languages and are available for download at: www.ttclub.com/ news-and-resources/publications/ ctu-code---a-quick-guide/ ?utm_source=pressrelease&utm_ medium=article&utm_campaign= CTU_Translations%20 The group is planning further translations. This is to create a better understanding of the complex dangers that may result from poorly packed or mis-declared cargo. The flexibility of containerised trade, and its efficiency in the movement of goods, means individuals many kilometres from the ocean, and with little knowledge of maritime operations or indeed other modes of transport, are tasked with packing containers with a hugely varied range of goods. Enabling access to safety guidelines in their own language is crucial.
BIFA has been informed by CLECAT that France will start enforcing a European rule that limits its cross-border traffic within the EU to 40 tonnes on 1 January 2022, despite 44 tonnes being allowed both on its territory and in the road leg of combined transport operations. A decree clarifying the French rules and bringing them in line with EU Directive 96/53/EC on weights and dimensions was published on 31 July. The text confirms the total authorised rolling weight of an articulated vehicle with more than four axles is limited to 40 tonnes (except for the road leg of combined transport operations). Until recently this rule was not enforceable in France as French legislation did not foresee sanctions. But with a new addition to the French traffic-law, this situation has now come to an end. The penalty for non-compliance with these provisions is €750 per overweight tonne.
Please also note that the principle of shared liability applies in case of overloading as member states can make both the shipper and the haulier liable in such cases. While shippers and road transport associations have been calling for more flexibility of the rules, the new rules confirm the situation whereby border crossing is limited to 40-tonne vehicles, even though Belgium and France accept 44-tonne trucks at national level. To note, Belgian traffic law has not yet adopted the European directive, so the reverse situation is currently not punishable.
Changes to Customs safety and security requirements
Following the end of the Brexit Transition Period, Britain left the European Union Safety and Security (S&S) Zone. Since then staged Customs controls have been gradually introduced. From 1 October 2021, as planned, standalone exit summary (EXS) declarations will be required following the end of the easement for empty units being moved to the EU under a transport contract, and goods in ro-ro vehicles. If you are a carrier defined as the operator of the active means of transport, you will hold the legal
responsibility to make sure the UK Customs authority is provided with pre-departure safety and security information. This means you will need an exit summary (EXS) declaration in the following cases: • Empty pallets, containers, vehicles being moved under a transport contract, • Goods which have remained in temporary storage for more than 14 days, • Goods which have remained in temporary storage for less than 14 days, but the import entry summary (ENS) details are
unknown, or the destination consignee has changed,
• Goods being moved under transit using either a Transit Accompanying Document (TAD) or a Transit Security Accompanying Document (TSAD), or via the Transports Internationaux Routiers (TIR). If you would like more information about submitting EXS declarations visit www.gov.uk/guidance/findout- when-to-make-an-exit-summary-d eclaration
UK-EU trade consultation seeks input from industry
The International Trade Select Committee appointed by the House of Commons, and currently chaired by Angus Brendan MacNeil MP (Scottish National Party), is seeking industry input into its enquiry about the UK-EU trading relationship. Following the end of the post- Brexit transition period on 31 December 2020, UK-EU trade
is being conducted under the terms of the UK-EU Trade and Co- operation Agreement (TCA). The inquiry is looking at a range of issues relating to these new trading arrangements, including: • What impact they are having on businesses and other stakeholders; • How they are being managed through the mechanisms
provided for under the TCA; • Implications for the UK’s wider trade policy; • Likely future developments in the UK-EU trading relationship. You can submit evidence until Friday 31 December 2021. More information and details on how to submit your evidence can be found at https://committees. parliament.uk/call-for-evidence/398/
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TT Talk publication seeks to cut risks of transporting dangerous goods
A recent TT Talk publication entitled ‘Dangerous goods: advancing risk
management’ seeks to provide guidance to mitigate the risks associated with transporting dangerous goods through the global supply chain. While the series of catastrophic containership fires experienced during 2019 has, happily, not been repeated this year, there is no room for complacency. The incidence of lesser fires and emergencies arising from the carriage of dangerous goods – whether declared, mis- declared or undeclared – persists. These risks can be actively managed through a number of steps including: • Screening controls, • Inspection, • Condition monitoring, • Regulatory competence.
be aware of the risks and their responsibilities in relation to the prevention of emergencies. The full TT Talk article can be read at:
www.ttclub.com/news-and-resources/news/tt- talk/2021/tt-talk---dangerous-goods---advancing - risk-management/
Forwarders, hauliers and all other parties in the supply chain have their part to play and need to
By air – Warsaw Convention (17 SDR): £17.53 per kg
By sea – Hague Visby rules (2 SDR): £2.06 per kg £687.58 per package
BIFA STC: (2 SDR): £2.06 per kg
By road – CMR (8.33 SDR): £8.59 per kg
(The SDR rate on 17 September 2021, according to the IMF website, was 1.03137)
By air – Montreal Convention (22 SDR): £22.69 per kg
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As claims mount, discussions are under way about how to limit the risks of fire and overboard containers on the new generation of ultra large container vessels Boxship insurance claims continue to rise
To reduce the risk of major losses, insurers are working with shipowners, shipbuilders, flag states and ship classification organisations to improve vessel safety. The first item on the International Union of Marine Insurance (IUMI) agenda is fires, where some progress has been made. Work is under way to amend the International Convention for the Safety of Life at Sea (Solas) to improve fire detection and control on new containerships. The amendments will come into force on 1 January 2028, if adopted before 1 July 2026. Lost containers Efforts to tackle containers lost overboard, a relatively new area of discussion, are in earlier stages but remain a priority. IUMI believes that regulation of the lashing equipment used to secure containers to vessels may need to be strengthened, for example. While it may take time to implement regulations, it is thought that some shipping companies are already taking action, such as improving container checks and systems for positioning dangerous goods to prevent fires. Until a year ago, there was on average a fire on a container vessel every other week; now the frequency of fires has decreased, but there is no room for complacency. In many ways the risks are going to continue to multiply as shipping lines faced with unprecedented demand have placed orders equivalent to 25% of the current global fleet. Many of these will be ultra large container vessels, which are currently causing the insurers of containerships such concern.
A series of major loss events involving containerships in recent months — including a sudden surge in containers lost overboard in the North Pacific region in late 2020 and early 2021, the grounding of the Ever Given in the Suez Canal in March and a fire that destroyed the X- Press Pearl off the coast of Sri Lanka in June — has highlighted the risks to companies that insure ever-larger vessels. Efforts are under way to stem rising insurance claims from such incidents, but it could take years to make an impact, according to marine insurance specialists. It has been noted that it usually takes the International Maritime Organization (IMO), the global regulator, approximately 10 years to introduce and pass any regulatory changes. Bigger ships, bigger claims Container losses, ship fires and the overarching trend of increasing vessel sizes — which makes ships harder to control and rescue along with more cargo and vessel to lose or damage —
have conspired to create bigger exposures for insurers. Claims from these incidents can affect all areas of marine coverage – hull and machinery, cargo, and marine liability – collectively known as protection and indemnity insurance or P&I. The average number of containership claims covered by the International Group of P&I Clubs – a risk pool of mutual marine liability insurers – increased to 5.2 per year between 2016 and year-to-date 2021 from 1.4 per year between 2010 and 2015, according to Alexander Gray, head of marine P&I at insurance broker Lockton Inc in Singapore. The International Group pool and its reinsurance programmes cover claims from $10 million to $3.1 billion. The frequency and severity of claims is increasing, and we are now seeing total annual claims exceeding the total premiums paid. This ‘negative trend’ is causing concern among insurers and reinsurers and is not sustainable in the long term.
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Driver shortage impacts post EU-Exit and COVID-19 recovery
A look at why there is a shortage of HGV drivers across Europe, and at what can be done to improve the situation in both the short and medium terms
For months, the trade press have been leading with comments such as “UK retail giants urge government to relax rules on EU lorry drivers”. Many of these articles highlight that large supermarket chains and retailers offer bonuses and ever- increasing salary scales to encourage workers to join and remain with them. The crucial point is that the companies mentioned are retailers, not hauliers and/or freight forwarders. The first mentioned group, bolstered by the profits derived when goods carried by their drivers are sold to the end-consumer, are in a better position to offer these higher wages than the latter group who have to rely solely on any profits derived from carrying the same goods. Two recent events, EU-Exit and COVID-19, have exacerbated what was an already deteriorating situation, but the present driver shortage has been a long time developing with reasons varying between countries. For instance, the Army no longer provides driver training to all ranks as it did previously and, coupled with its diminished size, this is often quoted as a significant reason for a lack of HGV drivers in the UK. Two factors stand out: the average HGV driver is 55 years old in the UK and there is a global shortage of such personnel. In Europe, it is estimated that the total shortfall of drivers now exceeds 400,000 and, much to many people’s surprise, Poland is the most heavily impacted with a shortage of 124,000 drivers. The UK, dependent upon sources, is lacking between 76,000 and 100,000 drivers, and Germany 45,000 to 60,000 drivers. The UK, dealing with the twin problems of EU-exit and COVID-19, has seen many overseas personnel leave the sector, returning to their EU homes where they can enjoy
similar pay and conditions; consequently it is thought that they are unlikely to return. From a government perspective, the DVSA, due to COVID-19 restrictions, has been unable to provide sufficient test capacity for trainees and this bottleneck has reduced the number of new drivers who can replace those who are leaving the sector. Ultimately the UK has to find its own solution to this problem. Opening the borders to EU employees may provide a short-term solution but it is not the long-term answer. Already some Eastern European countries are seeking to recruit drivers in Central Asian countries and the Caucasus. In certain cases, the search extends to Bangladesh, India, the Philippines and Vietnam. The process can easily take three to six months. Wage issues The first and most significant problem is how to make the sector more appealing. There is some anecdotal evidence that higher wages are making it easier to recruit and retain drivers – but this wage inflation, if it does not feed into higher transport rates, will create financial issues for the employer. However, it is also re-establishing the pay differential between salaries paid to HGV drivers and local van drivers. Many have commented that the latter, fulfilling a predominantly local role, have not until now had a sufficient financial incentive to qualify to drive larger vehicles. But more needs to be done to improve conditions and the overall working environment for all drivers. There has been an increase in actual and reported violent attacks on drivers by criminal gangs; rectifying the lack of safe parking must be a priority. For too long, UK governments have been over-reliant on the private sector to deliver their policies. Providing sufficient safe parking should be regarded as part of the UK’s strategic
The first and most significant problem is how to make the sector more appealing
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national infrastructure to ensure that goods are delivered; the UK government should provide sufficient resources either to ensure their provision or to build these facilities. Rather like forwarding, driving commercial vehicles is not promoted as a career choice in schools. However, it is an important and responsible role and steps need to be taken by both government and industry to make younger people aware of a career in commercial driving. This is particularly important given the need to reduce the currently high levels of unemployment amongst younger people as part of post- pandemic recovery plans. However, one issue that will have to be addressed relates to high insurance premiums applied to younger drivers, which deters operators from employing them. Recently much has been made of the fact that drivers tend to be male; in fact only 2-3% of the current workforce is female. Effectively, driver recruitment is being undertaken from only half the potential workforce. Whilst driving is not a suitable career choice for everyone, regardless of gender, recent research has highlighted certain issues that discourage women considering such a career. The two most relevant are fears about personal safety and the lack of flexibility regarding working hours. Too often we hear the road sector lumped together as one; in fact it includes many activities and some are facing bigger issues than others. At a recent BIFA Surface Policy Group meeting, the shortage of drivers willing to provide container haulage was highlighted, being described as “the worst driving job in the country”. One problem for drivers, that few mention, is the boredom of having to queue to deliver or collect a container from a dock. No solution is seen to this issue. Whilst boredom is a problem, the flip-side is stress: having to meet tight delivery timescales imposed by delivery depots and having to use often busy roads made worse by roadworks and unexpected delays caused by accidents, etc. Another problem is the relatively high cost of obtaining an HGV licence and driver CPC. While everyone accepts the need
to ensure that drivers are competent and safe behind the wheel of their vehicle, many that BIFA have spoken to see no purpose in the driver CPC, which is relatively expensive and reduces driver availability due to the need to ensure that 35 hours of training is undertaken over a five-year period. For at least domestic drivers, BIFA believes that the need to maintain a CPC should be reviewed by the Department for Transport. The current difficult situation has developed over 15 years and it is going to take several years to resolve. In fact, other industries are facing similar problems and there is a common thread. The affected sector is often highly fragmented with a large number of small organisations operating within it, and roles that often involve the use of equipment and in some cases an element of manual labour. Government policy At the time of writing, the government is opposed to granting temporary permits for EU nationals to work in the UK, arguing that this would be a temporary fix; politically it would not reflect well on promoting the UK’s exit from the EU as a success. The government’s temporary fix argument has some merit with regard to the longer-term issues. However, if time limited permits were granted they would provide a breathing space for the UK road haulage sector, so disrupted by the UK’s exit from the EU and then the unforeseen COVID-19 pandemic, to adjust to the new situation. Some clearly believe that given higher wage rates the situation can be stabilised, particularly if the testing and licensing bottleneck can be resolved. Looking ahead, ways have to be devised to make the role more attractive in order to ensure its long-term sustainable future. This may be problematical as no one knows for sure how big the pool of potential candidates for driving roles is. Concurrently, working with industry, government must address its responsibilities to improve the road network with an emphasis on making it safe. It is going to take time to fix the problem but at least all know the importance to the nation of drivers and their vehicles.
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Maersk Line was the most reliable top 14 carrier in July, with a service reliability of 47.3%
Container shipping reliability dips further and other services suffer
ports on the American West Coast has exacerbated the problems.
Vessel schedule reliability is at historically low levels whilst lines are making eye-wateringly high profits from their activities, much to the irritation of BIFA Members
However, what is not acceptable is the poor service that is provided by carriers in many of their administrative functions. Too often BIFA has heard from Members that carriers have been too slow invoicing for collect freight and terminal charges, making it impossible to arrange collection within the free quay rent period. Also, carriers have mislaid original bills of lading, delaying cargo release whilst indemnities are obtained, or have released cargo to the wrong party. What is rightly annoying BIFA Members is that where shipping lines have made an error leading to additional cost, they decline to accept responsibility for their error and bill the forwarder for quay rent, etc. Often the forwarder has difficulty recovering this additional charge from its customer. BIFA has not joined the chorus of condemnation being directed against carriers, but the Association does strongly believe that lines should accept responsibility for their own errors and not expect another party to pay for them.
In the latest figures released by Sea-Intelligence, vessel schedule reliability (those vessels arriving within 24 hours of their scheduled berthing) declined in July 2021 by 3.8 percentage points to 35.6% compared with June 2021. This represented a very significant decrease of 29.7% on the same month in 2020. The average delay for late vessels increased by 0.35 days between June and July 2021 to 6.88 days. The July figures were a slight deterioration on the previous three months but were not as bad as the February figures. It would appear that on this issue at least there is a degree of consistency – but at a historically low level, hovering around the 35% to 40% mark for most of this year. Maersk Line was the most reliable top 14 carrier in July, with a service reliability of 47.3%,
with Hamburg Sud scoring a reliability rating of over 40%. Four carriers achieved a reliability rating of between 30% and 40%, six between 20% and 30%, and the remaining two under 20%. The worst performing carrier during this month was Evergreen with only 16.2% of all vessels arriving on time. Provocative profits Many in shipping note that this is their biggest complaint: vessel schedule reliability is at historically low levels whilst lines are making eye- wateringly high profits from their activities. Admittedly, there are certain factors outside the carriers’ control which have impacted these performance figures – for instance unexpected port closures such as at Yantian and Ningbo and widely reported terminal congestion such as at
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the cladding manufacturer overseeing delivery at the Swedish site. “We arranged for our ALLMI-registered person to follow the vehicles out to Jarbo at our cost to provide that extra- mile service for our customer. “As a result of us going that one step further, our relationship with our customer has strengthened massively. We have been rewarded with further work, including a vast storage agreement, with finished goods to be held at our Pencoed facility, and the loading of their containers being handled by our experienced team,” Michael said. “Partnerships and longstanding relationships with our customers have kept us in business throughout the pandemic and allowed us to grow our team in the first half of 2021.” Supplier relationships UWL also nurtures relationships with its suppliers. During the pandemic, for instance, the company brought payment dates forward where possible. “We kept as regular a flow of work to our suppliers as we could and as much as we supported them, they supported us,” Michael said. As for what motivates employees at family- run UWL to go the extra mile, he commented: “Our staff truly enjoy coming to work. It is not your typical nine to five and neither would any of us want it to be. “UWL has thankfully kept its family values throughout our expansion and as the years go by, and more people come into the team, we ensure that we are all striving for the same success, with customer service always at the heart of everything we do.” Adapting for Brexit Michael Mitchell noted that at the start of 2021, it was evident that there were not enough clearance houses to cope with the demands of Brexit. “We therefore set up a Customs clearance department and brought all Customs requirements in house,” he said. “We saw an increase in business as a result and have grown the team to a five-person permanent operation in a very short time. We raise our own import declarations via a CHIEF system, complete export declarations and raise our own T documents. “Being part of a global logistics network, we have been able to assist all our clients and their customers alike with clearances all over the EU and developed great partnerships as we go.”
Going the extra mile Pencoed-based United Worldwide Logistics places customer service front and centre. Its efforts were recognised with the 2020 BIFA Extra Mile Award
EXTRA MILE AWARD
Descartes gives international freight
packaging, replacing wood with polystyrene foam to allow for more compression without damage. “We used foam backed with cardboard underneath the straps with cornices over those to ensure the goods underneath were not damaged by the securing processes and roof straps,” Michael said. The new packaging solution also occupied less space, reducing the cost of transport. Up to 10 loads of panels left the UK each day from Immingham direct into Gothenburg, and on to the delivery site via both rail and direct trucking. During 2020, COVID-19 restrictions prevented forwarders and shippers a single Customs platform to import and export freight across international borders. Descartes’ Customs, freight and transport management software is used by most of the major forwarders and shippers in the UK to optimise speed of entry with single data entry for multiple countries, boosting productivity, improving data quality and ensuring compliance with the Union Customs Code. Descartes’ transport management solutions will increase efficiency, reduce costs and enhance customer service when using outsourced multimodal transportation operations.
United Worldwide Logistics (UWL) began working with a local company specialising in cladding for buildings in October 2019. Initially, this involved transport within the UK, but UWL’s investment in specialist MOFFETT (truck-mounted forklift) vehicles, an on-site shunter and a dedicated customer care team led to further work in Europe. “Our customer had spent a great deal of time and money creating product for a project in Sweden,” said UWL managing director Michael Mitchell. “Due to the delicacy of the product, previous suppliers had caused extensive damage to the goods during transit and our customer lost the contract. It spent months working on regaining the contract and when this finally paid off, it asked us for assistance.”
Delicate operation The interlocking cladding panels, which
measured between 6 m and 13 m in length, had to be handled with care as the slightest knock could bend or dent them, rendering the interlocking mechanisms unfit for purpose, Michael explained. UWL worked with the customer to redesign the
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October 2021
Recruitment
BIFAlink
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How to build a relationship with your local school or college
Can your business help raise the profile of the logistics industry? Following on from the Members’ Guide to Interacting with Schools and Community Groups booklet, sent to all Members last month, now is a great time for you to start building a new and exciting relationship with your local school. As we all know, the logistics market is vast with many pathways to follow, yet young people are unaware of its potential to be a rewarding and successful career choice. With Members expressing
concern about skills shortages within the industry, BIFA needs your help to raise its profile by forging a relationship with your local school or college. How can you help? 1. Appoint a staff member with good communication skills to oversee the project – this will also be a great opportunity to enhance their own project management skills. 2. Research your local schools – perhaps the secondary school that you attended, or where one of your colleagues or your own children attend.
3. Visit the school website and contact the headteacher or careers leader – they must list the person responsible. 4. Enquire about their existing careers programme; they will have a calendar of planned events that you could support. 5. What can your company offer the school? Perhaps offer a
workplace visit, a talk or even a work experience placement?
In the meantime, if your company can help to engage with young people and promote opportunities within the industry supporting this initiative, please contact Nezda Leigh on n.leigh@bifa.org
Look out for next month’s issue of BIFAlink for more ideas about how to get the message into schools.
Lorry crime prevention booklet published
The Serious Organised Crime Agency (SOCA), in partnership with the UK Border Agency, has published a booklet aimed at lorry drivers on the prevention of road freight crime and illegal immigration. Produced for lorry drivers who transport freight to and from the UK, the booklet contains information and advice to raise
awareness of the potential threats to commercial vehicles crossing the Channel and how to minimise the risk of becoming a victim of crime. The booklet can be downloaded from: https://assets.publishing. service.gov.uk/government/uploads/system/u ploads/attachment_data/file/257230/lorry- leaflet.pdf
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BIFAlink
Policy & Compliance
www.bifa.org
The cost of decarbonisation Shipping lines will become liable for their emissions in 2023 under the EU Emissions Trading System.
There is a real concern, however, that we will see additional surcharges as lines attempt to recover their costs
Two subjects have dominated the recent maritime market: the first is the current demand and supply imbalance leading to record price levels boosting carrier profitability. The second concerns the sector’s efforts to reduce greenhouse gases (GHG) and, in particular, carbon emissions. These initiatives are at both a global level, as proposed by the International Maritime Organization (IMO), and at regional levels such as within the European Union. Carriers are likely to face new expenses related to the wider shipping industry’s efforts to decarbonise operations. The European Commission has chalked out a strategy for decarbonising shipping. The commission announced on 14 July 2021 its proposal to gradually introduce shipping into its Emissions Trading System (ETS), a carbon market that operates in all EU countries, with the aim of achieving climate neutrality in the EU by 2050. The system operates under a ‘cap and trade’ principle that currently applies to GHG and CO 2 emissions. It works by capping overall GHG emissions of all participants in the system, which is then reduced over time. How it works Carbon emitters are obligated to pay for each tonne of CO 2 they generate using EU allowances (EUAs). Such allowances are described as rights to emit GHG emissions equivalent to the global warming potential of 1 tonne of CO 2 equivalent. The level of the cap determines the total number of allowances available in the whole system, which can be traded among shipowners. The EU ETS has been operating since 2005, and up until now the main types of industry impacted have been the high energy users such as iron and steel manufacturing, the refining and
chemical industries and power generation. However, from 2023, 100% of shipping emissions from intra-EU voyages and 50% of carbon emissions on a voyage to or from a port in the EU will be included in the ETS. It should be noted that shortsea will include the ferry sector. The first year in which shipping companies will be liable for their emissions will be 2023 when shipowners must surrender enough CO 2 permits to cover 20% of their emissions. Thereafter, shipping companies will be liable for 45% of emissions in 2024, 70% in 2025 and 100% in 2026 and every subsequent year. Such a system will enable shipowners to take steps to reduce their GHG emissions; if they have allowances left over these can be sold in the market. If their emissions exceed their allowances they will face hefty fines, currently set at €100 per kg of excess CO 2 emitted, unless they purchase additional allowances from the market. The EU ETS scheme is complex, and given the nature of the maritime sector with its sudden peaks and troughs, it is going to be difficult for shipping lines to work out precisely the number of permits required and what happens should a
shipping line exceed its emissions in any one year. The other issue is that, whilst the IMO has been slow arriving at a global programme to decarbonise the maritime environment, the unilateral action of the EU has added a level of complexity and raised the prospect of a piecemeal regional approach to the issue, which is not welcome in a global industry. There is a real concern that we will see additional surcharges, etc, as lines attempt to recover their costs. Added costs Everyone seems to accept that climate change is harming the environment and that something needs to be done. What many, including many politicians and environmentalists, fail to acknowledge is that these changes will cost money, and these costs will ultimately be borne by the consumer. It is time that governments started making this point clear to the public. Already we have seen some port operators introducing a surcharge to cover the increased cost of battery powered straddle carriers as opposed to conventional equipment – and that is only the tip of a possibly melting iceberg.
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October 2021
Policy & Compliance
BIFAlink
www.bifa.org
What is sustainable aviation fuel? Sustainable Aviation Fuel has the potential to reduce lifecycle emissions by up to 80%, compared with conventional aviation fuel
sustainable fuels is no longer an option for the air industry. SAF gives an impressive reduction of up to 80% in carbon emissions over the lifecycle of the fuel compared to the traditional jet fuel it replaces, depending on the sustainable feedstock used, production method and the supply chain to aviation. Facts from IATA: • Over 300,000 flights have taken to the skies using SAF since 2016, • Seven technical pathways exist, • 100 million litres of SAF will be produced in 2021, • SAF can reduce emissions by up to 80% during its full lifecycle, • Around 7 billion litres of SAF are in forward purchase agreements, • More than 45 airlines now have experience with SAF. The key to greater acceptance and deployment of SAF is a reduction in costs. Over the long term, that will require investment in advanced technologies to process feedstocks more efficiently at greater scale, and investment in the development of sustainable and scalable feedstock options. However, in the short term, interim support from governments and other stakeholders through policy incentives is needed. This support needs to be part of a long-term framework to give investors the confidence to make the big investments required to grow supply.
As a day-to-day motorist you will have seen the focus on phasing out fossil-fuelled cars and the introduction, firstly of hybrid engines, and then full electric-run vehicles. But what of aviation, the global dependence on it and its future, with pressure to reduce the global carbon footprint? Sustainable Aviation Fuel (SAF) is a clean substitute for fossil-based jet fuels. Rather than being refined from petroleum, SAF is produced from sustainable resources such as waste oils from a biological origin, agricultural residues, or non-fossil CO 2 . SAF is a so-called drop-in fuel, which means that it can be blended with fossil-based jet fuel and that the blended fuel requires no special infrastructure or equipment changes. Once it is blended, the fuel is fully certified and has the same characteristics and meets the same specifications as fossil-based jet fuel. Since aircraft are not able to switch to alternative energy sources (like hydrogen or electricity) in the foreseeable future, aircraft will remain reliant on liquid fuels. Therefore,
sustainable aviation fuel made from renewable feedstock is one of the most important short- term options to significantly reduce the industry’s carbon footprint and at the same time begin to reduce the dependency on the petroleum industry. Any aircraft certified to use the current specification of jet fuel can use SAF. Sustainability is most often defined as meeting the needs of the present without compromising the ability of future generations to meet theirs. It has three main pillars: economic, environmental and social. These three pillars are informally referred to as people, planet and profits. The price of SAF today is higher than traditional jet fuel, a potential major hurdle because fuel is 20%-30% of the operating cost of an airline (IATA 2018). Research and development can help bring the cost down, although to what extent is still unclear, which potentially has clear cost implications. Regardless of the financial costs involved, it is clear that failure to change to
October 2021
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BIFAlink
Events
www.bifa.org
Rugby legend to host awards
Last call for entries Are you putting the final flourishes to your BIFA Awards submission now? Get your entries to BIFA by Thursday 7 October to ensure that your story makes it to the judges and you are in with the chance of making the shortlist of finalists. Finalists will be announced later this month, at which time bookings will open for the BIFA Awards luncheon ceremony that will (COVID-19 restrictions allowing) take place on Thursday 20 January 2022 at The Brewery, Central London. Rugby legend BIFA is excited to announce that the host for the 33rd BIFA Awards ceremony will be England Rugby World Cup winning team member Matt Dawson MBE. In a rugby career spanning 15 years, Matt played at club level for Northampton and London Wasps, made 77 appearances in an England shirt and joined seven tours with the British and Irish Lions. Since his retirement from rugby, Matt has developed a high-profile media career alongside roles in business. As the longest serving team captain on A Question of Sport, Matt appeared opposite team captains Ally McCoist and Phil Tufnell under the watchful eye of presenter Sue Barker. Matt has also proved himself on the dancefloor, finishing second in Strictly Come Dancing, and in the kitchen winning Celebrity Masterchef, both in 2006. Valued support BIFA would like to acknowledge the valuable support given by the returning BIFA Awards sponsors and welcome software and solutions provider Newage to the team. Representatives from the category sponsors will meet next month to review the finalists’ submissions and select the category winners to be announced at the ceremony in January. The category sponsors are: • Albacore Systems • American Airlines Cargo • BoxTop Technologies
Supporting the ceremony in January are: • Agency Sector Management (UK) Ltd
• CNS Ltd • Simpex Express • Woodland Group
• Descartes • IAG Cargo
• Newage ** New sponsor ** • Peter Lole Insurance Brokers • Port Express • Seetec Outsource • TT Club • Virgin Atlantic Cargo
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October 2021
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