The Ministry of Foreign Affairs is pulling back on import/export chain reporting as shipping stabilises.
The supply chain crisis that has plagued the world might just be over, according to a government agency and industry heads.
Since the middle of 2020, the Ministry of Foreign Affairs and Trade’s Trade Recovery & Resilience Unit has been putting out quarterly reports monitoring global supply chains, but its most recent will be its last.
“With the stabilisation of international supply chains following removal of Covid-related border restrictions in all major markets, and a rebalancing of global freight supply and demand, this report will be the final one in the series,” a summary for the report said.
An initial pullback on shipping capacity at the beginning of the pandemic combined with unprecedented demand for goods and lengthy lockdowns has seen the world playing catch-up for three years.
READ MORE: * Don’t expect cheap freight anytime soon * Shipping congestion will ease once recession hits * Gabrielle a curveball for supply chain recovery
Mfat’s final report, released this month but covering the quarter from January to March, said reliability of sea freight was continuing to improve.
According to S&P Global, steadier supply chains are linked to slowing demand for goods.
Mfat’s report said while prices and delivery times hadn’t returned to pre-Covid levels - and would take some time to do so because of New Zealand’s isolation - some level of disruption had become widely accepted as business as usual.
The ministry said air freight, the majority of which comes in on passenger flights, was also recovering as international flights continued to ramp up.
Export NZ director Catherine Beard said supply chains were getting back to normal though it was taking a bit longer for New Zealand, “I can see why Mfat isn’t necessarily wanting to continue to monitor it if its more business as usual out there.”
For Beard, a true return to business as usual would be indicated by price and reliability returning to pre-Covid levels, but it was nuanced.
“Prices can be a bit cyclical even without pandemics, and that comes down to supply and demand.
“At one point there was an oversupply of ships in the world and that led to really low and probably unsustainable prices for freight,” Beard said.
Those low pre-pandemic prices are unlikely to be available to New Zealand businesses any time soon.
Ports of Auckland chief executive Roger Gray said New Zealand’s major ports had managed to return to regular berthing windows for visiting ships, meaning port companies and shipping lines can plan, prioritise and work efficiently.
“We're now processing ships the way we used to do before Covid-19 and we're starting to see regularity returned, but like aviation, it's not perfect.
“Largely we're on top of the volume that's coming through and we're turning the ships on time,” Gray said.
This has positive implications for New Zealand businesses with retailers and cargo owners more confident in being able to get stock in when they need it and moving away from stockpiling goods just in case.
“We're seeing some decreasing in volume coming through because of reduced demand while they clear inventory out.”
