Monday, July 9, 2012

Container and Road Freight Down as Eurozone Crisis Hits UK Logistic Companies Export Trade

Spain, Greece and Ireland All Suffer Import Slump
Shipping News Feature

EUROPE – With the Eurozone crisis in full swing freight traffic for logistics operatives reliant on import and export trade with the worst affected countries is naturally far from buoyant. UK based container and international road haulage specialists trading with Ireland, Spain and Greece all report similar problems with imbalances between exported and imported cargo due to the drop in the value of the euro and the lack of funds available to consumers.

At Dublin Port the figures just released for the period January to May, principally for container and road trailer borne traffic, show a 2% drop according to local press reports. Dublin handles around half of Ireland’s overseas marine cargo and, whilst exports fell just 0.7%, imports declined 2.3% in the period concerned. Trailer and container operators always aspire to that perfect balance between the two trades and the larger the disparity, the trickier it becomes to maintain equilibrium of rates.

Just last month the Dublin Port Company paid a €10.2 million dividend to the State based on its profits last year bringing the total paid to its only shareholder to €46.8 million over the past six years and the prediction last year was for 2% growth in the period studied. Meanwhile Greek and Spanish markets are being similarly afflicted and speaking to the Handy Shipping Guide, Steve Wise, Director of Essex based SLA Logistics which specialises in road trailer freight between Greece and the UK, said:

“The traditional seasonal export fruit trade is as strong as ever and other export cargoes from Greece are also running at reasonable levels but trade in the other direction is down and there is reluctance amongst Greek owned haulage outfits to travel to the UK due to the scarcity of backloads.

“Whilst high end cargoes, the valuable goods destined for wealthy end users, continue to increase we have seen more young Greeks from middle class families returning home together with their personal belongings as parental financial support dwindles, due to the ever rising costs brought about by the current exchange rate and the situation back home.

“As the export/import balance changes more hauliers, particularly with reefer boxes, are returning from the UK either empty or part loaded and topping up in France or other countries en route.”

Italian based logistics group Arcese also maintain an Essex base which has regular traffic to and from Spain and spokesman Gordon Daffen indicated that trade was following an almost identical pattern to that of the Greek trailer market saying:

“Currently Spanish exports into the UK are buoyant but, with the exception of top end products, traffic in the opposite direction is flat with the euro situation making it very hard for UK exporters and with hauliers now becoming a lot less fussy as to what precisely they load when shipping out from the British Isles.”

The stresses within the three countries domestic economies will continue to impact on their import trade particularly. Whilst a falling euro should have the effect of increasing overseas sales thus boosting exports it seems that the acceleration is too slow at present to have a meaningful effect and the imbalance caused bears its own problems.

Additionally some markets have been suffering from a variety of debilitating factors for some time. Many Greek road haulage operators, in common with those in other EU countries, blame the influx of cheaper Eastern European hauliers into the market for many of their problems as they have been uncompetitive on rates for the past few years and witnessed a steadily dwindling return on their investments with many going to the wall as a result or relying purely on domestic trade.