Challenges such as freight rate increases and transport delays
KITA "Cooperating with Ministry of Trade, Industry and Energy and Ministry of Oceans and Fisheries"
Seven out of ten export companies are judged to be experiencing logistics difficulties due to the Red Sea situation.
The Korea International Trade Association (KITA) announced on the 30th that it held a 'Red Sea and Panama Logistics Risk Diagnosis and Response Seminar' at the Trade Tower in Samseong-dong, Gangnam-gu, Seoul.
KITA stated that the seminar was held to seek countermeasures following recent attacks on civilian vessels by the Houthi rebels and disruptions in passage through the Suez and Panama Canals caused by drought in Panama.
From the 2nd to the 12th, KITA conducted a survey on logistics difficulties after the Red Sea situation targeting 110 import and export companies over 11 days. The survey results showed that 74.6% of the responding companies are experiencing logistics difficulties.
Among the logistics difficulties, the highest response rate was for increased freight rates (44.3%). This was followed by transportation delays (24.1%), difficulty securing shipping space (20.2%), and difficulty securing containers (11.4%).
At the 'Red Sea and Panama Logistics Risk Diagnosis and Response Seminar' held by the Korea International Trade Association at Trade Tower in Samseong-dong on the 30th, Kim Go-hyun, Executive Director of the Korea International Trade Association, is delivering the opening address. [Photo by Korea International Trade Association]
Companies reported difficulties such as challenges in delivering buyer products due to soaring maritime freight rates, substituting air transport due to transportation delays, and delayed payment settlements caused by delivery delays.
About 200 import and export companies attended the seminar, where representatives from major domestic logistics companies such as LX Pantos and Ramses Logistics explained the diagnosis of logistics risks related to the Red Sea situation and response measures.
Hwang Gyu-young, team leader at LX Pantos, said in his presentation, "Recently, the shipping market has been suffering from temporary supply shortages and freight rate surges due to risks at the two major canals, and the response capability of shipping logistics companies has become a factor determining survival. We hope that activities to check the impact of vessel supply shortages caused by the two major canal risks and future scenarios will help companies formulate response strategies."
Kim Go-hyun, executive director of KITA, said, "It is time to diagnose logistics risks caused by the Red Sea situation and for import and export companies to seek proactive response methods. KITA will promptly promote support projects in cooperation with the Ministry of Trade, Industry and Energy, the Ministry of Oceans and Fisheries, and major shipping companies to help companies secure shipping space stably."
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