UK warehouses reaching capacity, just weeks left before full
Just 10% of UKWA members’ warehouse space is now left available according to survey
A survey of logistics and warehousing operations, conducted by leading sector trade association UK Warehousing Association (UKWA), has revealed that lack of available warehousing space in the face of COVID-19 restrictions is reaching a critical point, with potential for zero capacity within weeks.
90% of respondents in the UKWA survey, which was designed to identify and quantify the current impacts of COVID-19 on the industry, confirmed that they were totally full, suggesting that the market has just 10% pallet space availability.
According to UKWA CEO Peter Ward, this crisis has been driven by outbound flows from DCs of non-essential goods grinding to a halt in the face of retail and manufacturing closures due to COVID-19 restrictions, while inbound flows continue to arrive at UK ports.
“With outbound flows severely reduced or stopped altogether as stores and factories are closed, inbound flows have become a mounting problem,” he says. “Inbound supply chains continue towards destination, arriving at ports, requiring receipt, handling, onward distribution and storage.”
As retailers’ own DCs become full, they are expected to turn to the third-party sector to provide annexed warehousing and with current estimates of available storage capacity at around 1.5 million pallet spaces nationwide, Ward predicts the UK marketplace has approximately 2-3 weeks of capacity.
“UKWA estimates an import volume through South/South East deep-sea ports of approximately 45,000 teu per week for the foreseeable future,” he explains. “This weekly volume is likely to require storage of some 750,000 pallets each week until lockdown is eased and retail stores re-open. Although we expect numbers of fulfilled orders arriving in the UK to be dropping off by the end of May, over the coming month, the search for additional space could become desperate.”
In response to the rising crisis, UKWA has set up COVID-19 Emergency Space Register on its website (UKWA.org.uk), where all available space identified will be collated and shared on a weekly basis with immediate effect.
UKWA members and non-members are urged to share details of any space opportunities with the association, to enable UKWA to match supply and demand to help alleviate the current pressure on space.
Ports and shipping lines are encouraged and expected to continue charging quay rent, detention and demurrage charges as an incentive 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.