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Dear Clients, We awoke to news on Sunday morning that the US and Isreal had launched strikes against Iran and that Iran in-turn have retaliated. The situation has already seen major disruptions to aviation and air cargo networks and we'll start to see impacts to containerised shipping in the near future with flow on effects to be felt by Australian supply chains. OCEAN FREIGHT The conflict has escalated security risks to maritime traffic across key Middle East sea ways, particularly the Strait of Hormuz and Red Sea and shipping lines have started to implement emergency security and operational measures. Major ports in the region are currently closed and although this is a limited trade lane for Australian Trade, previously we have all seen what global shipping disruptions can do to freight rates. With ships parked at sea, in "safe zones" awaiting the re-opening of terminals in the region, container equipment becomes tight and longer transit times for those ships, throwing out schedules. What impact this will have on Australia and or global freight rates is yet to be seen, however it's highly likely to have upward pressure on pricing. AIFREIGHT & AVIATION Airspace over Iran, Iraq, Kuwait, Israel, Bahrain, the UAE and Qatar has been closed or is heavily restricted. Major regional hub airports, including Dubai, Abu Dhabi and Doha, have been shut resulting in passenger and cargo flights either being cancelled or rerout-ed, with aircraft and crews displaced globally, complicating recovery once airspace reo-pens. There will be a flown-on effect to all other major, non-Middle Eastern carriers as they navigate new and longer flight paths to avoid the region resulting in higher fuel burn and increased operating costs, placing upward pressure on air freight rates. INSURANCE Are you covered in "war events"? We recommend it's a timely reminder to check this with your insurance broker, to learn the cover you have and or don't. You may be surprised to learn that events of war are excluded from cargo insurance, whether declared or not. And those clients that are travelling, a friendly reminder to also check your travel insurance policies. As news develops and comes to hand we'll provide updates where appropriate. Should you wish to discuss any of these points, please don't hesitate to reach out to your key contact @ Transways Logistics International. |
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