How does the Omicron Variant Pose an Impact on the Cargo Industry in 2022?

Omicron impact on cargo industry abc cargo

As Delta was slightly getting under control, we were awaiting a new ray of hope, until Omicron doomed us and things got unpredictable! How did it affect the logistics industry? Let’s see! 

ABC Cargo, providing international cargo services, shares insights on what 2022 has in store for the logistics and transportation industry. 

As we know from decades ago, the logistics industry technically faces a boom in deals at the end of the year with the festive season rolling in, and that’s exactly what didn’t come through this year, due to the Omicron showdown! 

Omicron impact on cargo industry 

Major shipping and aviation freight charges have reached new highs as the Omicron mutant has slowed major ports and global supply once again. The Shanghai Containerized Freight Index (SCFI) grew by 125.09 points last week, reaching 4727.06 points, according to the industry on the 10th. Since the numbers were obtained in October 2009, this is the first time the SCFI has surpassed 4700 points. It has more than tripled in a year when compared to October last year (1438.2 points).

Since October 8, when it peaked at 4647.60 points, the SCFI has dropped for four weeks in a row, to 4,535.92 points. When the Omicron variant surfaced last week, the SCFI, which had been stagnant for some time, skyrocketed. Freight prices are rising in the Western Americas in particular.

As more export companies turn to air shipping as a solution to rising freight costs and limited freight space, air freight prices are rising as well. The burden of freight rates is increasing for small and medium-sized export enterprises with an active exchange of cargo to India, as opposed to large companies, which sign long-term contracts at a fixed rate. Companies that primarily produce domestically rather than globally are particularly heavily hit.

Now, keeping aside the fare rates, a new challenge has also sprouted, with workers facing weeks of quarantine and some quitting due to the fear of getting sick. There is a sudden dearth of truck drivers failing to fill the vacancies even after the promise of plummeting wages due to the current scenario of untimely roadblocks and lockdowns. 

To wrap up

Thus, the transport industry is all set to face another challenging year of supply chain disruptions, and ABC Cargo, the best cargo in the UAE, is ready to manage it with all their best abilities to continue serving with a purpose. 

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