The shipping industry has been affected on multiple fronts by Russia’s invasion of Ukraine, with loss of life and vessels in the Black Sea, disruption to trade and the burden of sanctions, said Allianz Global Corporate & Specialty (AGCS) in its Safety & Shipping Review 2022.
A prolonged conflict is likely to reshape global trade in energy and other commodities.
Since the onset of the global COVID-19 pandemic more than two years ago, the seafood industry has suffered from soaring shipping rates and reduced shipping options as firms from all industries battled for space aboard vessels.
Container shipping rates are likely to remain high for seafood companies until the third and fourth quarters of 2023, global carrier Eimskip told IntraFish at the recent Seafood Expo Gloal trade fair in Barcelona.
This roughly echoes comments made by Thue Barfod, the global head of leading container shipping firm Maersk Line's fish and seafood cargo division, during the IntraFish shipping and logistics webinar earlier this year.
At the time, Barfod said the seafood industry should finally be able to put shipping related disruptions behind it in sometime in 2023, but companies cannot expect to go back to the low transport rates seen before the pandemic.
An expanded ban on Russian oil could contribute to pushing up the cost of bunker fuel and impacting availability, potentially pushing ship owners to use alternative fuels that may result in machinery breakdown claims.
The evolving range of sanctions against Russian interests presents a sizeable challenge.
Violating sanctions can result in severe enforcement actions, yet compliance can be a considerable burden, said the report.
Sanctions also apply to various parts of the transport supply chain, including banking and insurance, as well as maritime support services, which makes compliance even more complex.
Russian seafarers account for just over 10 percent of the world’s workforce and around 4 percent come from Ukraine. These seafarers may struggle to return home or rejoin ships at the end of contracts.
The insurance industry is likely to see a number of claims under specialist war policies from vessels damaged or lost to sea mines, rocket attacks and bombings in conflict zones, said Justus Heinrich at AGCS.
“Insurers may also receive claims under marine war policies from vessels and cargo blocked or trapped in Ukrainian ports and coastal waters," Heinrich said.
Stringent measures aimed at combatting COVID-19 measures in China, a surge in consumer demand and the Ukraine crisis have all also led to unprecedented port congestion.
Chinese authorities plan to begin disinfecting them after an outcry from importers.
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