UKWA and Bis Henderson Space to co-ordinate an industry response to the impending container storage crisis

The team have concentrated on providing viable off-quay storage and handling solutions to provide a sensible alternative to the traditional port side storage operators. They are working to identify a selection of accredited solutions that can provide importers with secure, convenient and sensibly located container storage options that can provide cargo owners with cost effective long and short term storage options and subsequently keep ports operating.

Two weeks ago UKWA collaborated with the Bis Henderson Group to undertake a survey of UKWA members to assess the current and future implications of COVID-19 on the UK warehousing sector. The results were stark but not entirely surprising:

1. The UK could run out of warehouse capacity within a fortnight as imported goods pile up at storage locations and social lock-downs have devastated consumer demand
2. According to the survey 90% of respondents reported facilities at full capacity and suggested the overall market had just 10% capacity available

And, according to UKWA chief executive Peter Ward, “that remaining capacity is likely to be full by early May. With outbound flows severely reduced or stopped altogether, as stores and factories are closed, inbound flows have become a mounting problem,” he said. “Inbound supply chains continue towards destination, arriving at ports, requiring receipt, handling, onward distribution and storage.”

UKWA and Bis Henderson Space currently estimates there are around 1.5 million pallet positions available across the country, largely in third-party warehouses, to which UK retailers are increasingly having to turn for storage as their own distribution centres are full.

Mr Ward said: “UKWA estimates an import volume through south and south-east deep-sea ports of approximately 45,000 TEU a week for the foreseeable future. This weekly volume is likely to require storage of some 750,000 pallets until lock-down is eased and retail stores reopen.

“Although we expect numbers of fulfilled orders arriving in the UK to be dropping by the end of May, over the coming month the search for additional space could become desperate.”

Despite the pressure this is placing on hinterland supply chains, UKWA suggested ports and terminals and shipping lines should continue to levy quay rent, as well as demurrage and detention charges, to “encourage importers and cargo owners to clear containers through the ports”.

UKWA believes the request by certain cargo owners for financial support to alleviate quay rent is not a useful proposal to deal with the critical issue of moving containers, and suggests more effective alternative solutions should be considered.

However, if space does runs out, UKWA will also be able to support cargo owners in locating inland off dock storage facilities for fully loaded containers.

The key point, says Ward, is that should off dock storage be required, members can provide this under UKWA terms and conditions.

As such, UKWA has teamed up with Bis Henderson Space to coordinate an industry response to the impending container storage crisis.

Ports are reporting a serious build-up of containers on quaysides and traditional on quay storage facilities have been filled to capacity for some time.

Ward states “There are real commercial risks to storing goods, in terms of ownership and liability, that should not be the responsibility of ports or shipping lines”

“Once cleared through customs, loaded containers can be stored by our members under UKWA legal contracts which state that the ownership, insurance liability and risk sit with the cargo owner. We are keen to work together with all parties to offer a solution for cargo owners that also helps terminals and shipping lines keep boxes moving, while protecting them from unnecessary commercial risk.”

Andy Kaye, CEO, Bis Henderson Group commented;

“The storage options identified so far offer all of the usual benefits of  quay side accessible storage in terms of stock visibility, container accessibility and high levels of security but delivered at a cost effective price point designed to reflect the longer term nature of the required solutions. All are managed by UKWA members and covered by UKWA terms and conditions of handling and insurance”.