The LCL supply chain cure

/The LCL supply chain cure

Noatum Logistics Less-than-container Load (LCL) services offers shippers an alternative to more expensive air freight and full-load (FCL) services.

Our LCL services are becoming increasingly popular, as the coronavirus pandemic leaves more shippers turning away from full containers, and airfreight transport that is unavailable for cargo which is not necessarily essential, but still on a deadline. With pressure on air cargo capacity due to the cancellation of passenger flights and cargo freighters very expensive, air is simply not an option currently.

We also see customers calling off smaller orders to ship them at higher frequency on our weekly LCL services, which is particularly effective if the cargo needs to move the same week.

And as carriers remove around 30% of capacity over the next few months due to the diminished demand caused by the pandemic, they have announced incremental rate increases of $50 to $80 per TEU every two weeks since mid-March, which appear to be sticking.

With FCL costs increasing, more shippers are seeing the benefits of the stable and competitive prices of our LCL services.

Naturally we cannot entirely avoid the impact of cancelled sailings, but our commercial team is extremely skilled at leveraging relationships and always finding competitively priced space from among their roster of carrier agreements, or falling back on contingency plans if their preferred option is not available.

And, because we have service agreements in place and book our LCL carrier slots on a rolling eight week basis, our carrier partners have a clear indication of our volume requirements and will usually make alternative arrangements on our behalf, if necessary.

Despite the global supply chain challenges our most popular LCL consolidation services from Hong Kong, Shanghai, Shenzhen and Delhi continue to operate as normal, departing weekly.

We operate LCL services from other popular origins and are working to reduce cutoff times at origin and accelerate availability time at destinations, responding to the need for a faster service for shippers that no longer want to pay for airfreight, but require a time-sensitive alternative.