Container shortages in late 2020: planning strapping component orders when boxes are scarce

Through October and November 2020, finding an empty container became one of the hardest parts of shipping goods out of Asia. SEKO Logistics reported on 27 October 2020 that 40-foot high-cube containers were almost unavailable at some Asian origins, with standard 40-foot boxes also scarce in South China, Ningbo, Shanghai, Vietnam and Thailand, and carriers asking for priority surcharges to secure equipment and space.

In a 19 November 2020 analysis, Flexport explained the background. Carriers stopped ordering containers when demand fell early in the pandemic, leasing options dried up, and when demand recovered the fleet was smaller than at the start of the year. Some carriers stopped accepting certain US and European export bookings and returned empty boxes to Asia instead, and container manufacturers were reported to be sold out into early 2021. Rates moved with the shortage: Drewry’s composite World Container Index rose 2.8% to USD 2,702.82 per 40-foot container in its weekly assessment of 12 November 2020.

Packaging components rarely dominate a purchasing budget, but without buckles, clips or seals the finished goods cannot leave the line. That makes them a poor place to run short when shipping becomes unpredictable.

What the shortage means for a component order

Effect	What it means for the order
Longer, less predictable shipping	The supplier’s production lead time is only part of the total; add realistic time for equipment and space
Shorter quotation validity	Ask for the validity date and record it; an expired freight price is not a price
Priority or equipment surcharges	Agree in advance which party pays under the delivery term
Rolled bookings	A shipment can miss its planned vessel; stock should cover at least one missed sailing
Container types restricted	Some origins may offer only certain sizes; know which ones you can accept

Order earlier, and base stock on consumption

Work out how many closures each line uses per week, by part and nominal strap width, and set reorder points that cover the whole replenishment time, including the less predictable shipping element. A distributor can do the same for each customer group or region.

Tight stock creates pressure to substitute. Keep similar variants clearly separated in stock records and labels, so that a 19 mm buckle with one wire diameter is not shipped in place of another because it happened to be on the shelf. Our distributor identification guide shows how to keep those records clean.

Give the forwarder approved options

Flexport suggested several alternatives for shippers facing the shortage: 20-foot or 45-foot containers, non-operating reefers, loading at larger ports that tend to hold more equipment, premium services that guarantee equipment, and less-than-container-load (LCL) shipment. SEKO asked its customers to pre-approve alternative container types and possible surcharges, because waiting for approval could lead a carrier to reallocate the box.

Dense steel components may reach a container’s weight limit before its space is used, so a smaller box is not necessarily a compromise for this kind of cargo. Check payload limits with your forwarder before deciding.

Agree these points before the next booking:

• Container sizes and types you will accept.
• Whether LCL is acceptable, and up to what volume.
• Alternative ports of loading and discharge.
• A ceiling for surcharges that can be accepted without a fresh approval.
• Whether a shipment may be split, and how the documents follow each part.

Keep terms and responsibilities clear

Under the agreed Incoterms rule, the party that contracts for main carriage meets the equipment problem and its surcharges first. If you buy on a seller-arranged basis such as CFR or CIP, ask how the supplier will handle a rolled booking and how you will be told. If you buy EXW or FCA, agree how long goods can wait at the seller’s premises if your forwarder cannot supply a box, and who pays for that waiting.

Where possible, write a shipment window rather than a single date, and agree what happens to the price if a surcharge appears after the order is confirmed. The international procurement guide covers the wider structure of a first international order.

Do not let shortages change the specification

Pressure on lead times creates pressure to accept “equivalent” components from whoever can ship first. A buckle with a different wire diameter or a seal with a different profile is not a like-for-like substitute unless your team has reviewed it. Record any proposed substitution as a change, and review it with the same discipline as a new sample. The sample approval guide shows how to keep that record.

Send your forecast, required delivery window and accepted shipping options with the component details for galvanized wire buckles, sheet metal clips or steel strapping seals through the enquiry page, so that availability and lead time can be discussed against a realistic plan.