Near-shoring and trade deal boost to Turkey-UK freight

UK forwarder Davies Turner says key trade is benefitting from a near-shoring trend in manufacturing, heightened by the ongoing problems in deepsea container shipping markets. A recent UK-Turkey trade agreement and a near-shoring trend in manufacturing heightened by the ongoing problems in deepsea container shipping markets has boosted business on one of UK forwarding and logistics firm Davies Turner’s key trade lanes.

Alan Williams, director of leading UK freight and logistics company Davies Turner, said the agreement of tariff-free arrangements between the two countries were bringing benefits to UK importers and exporters, as well as the freight forwarding and logistics companies that manage their supply chains – highlighting that Davies Turner operates the most frequent overland trailer services to the UK from Turkey.

And he said the problems in UK and European deep-sea ports, which have prompted traders to turn to Turkey as an alternative source of supply to countries in Asia, is having an impact on the trade.

“Suppliers in Turkey can offer rapid response times for goods while freight costs are significantly lower, especially now that container rates in the Far East to Europe trade have soared to record highs,” Williams said.

He added that the cost of trailer operations from Turkey has also been mitigated by the increased use of ultra-high-capacity double deck trailers.

More responsive

As a market leader in overland trailer services between Turkey and the UK, Davies Turner works in a long-standing partnership with Istanbul-based Ekol Logistics, noting that it “finds that it can offer a far faster, much more responsive service than shipping from the Far East. Moreover, exchange rates currently favour exports from Turkey to the UK, which has also helped to offset the country’s somewhat higher labour costs compared with Asia,” the company added.

Davies Turner highlighted that the COVID-19 pandemic had also created “unprecedented volatility in consumer buying patterns, with locked-down shoppers turning to online channels in huge numbers, and this also favours countries that can provide a fast response”.

With Turkey being a major cotton grower that produces large numbers of clothing items such as T-shirts, Williams added that the lockdown and working from home has had another, somewhat unexpected, effect on the market for fashion goods. “The move to a more casual at home look has seen volumes for our larger clients in some cases treble as production has moved from Asia to Turkey,” he said.

“Added to this is the massive increase in ocean rates from China, so we expect our clients’ volumes in this trade to continue to increase for the remainder of 2021.”

Consistent journey time

With reports of containers being stranded on the European mainland for weeks or even months, Davies Turner said “Turkey can offer a much more consistent journey time”, noting that the company “can sidestep any border delays on Turkey’s road frontier by using the ferry service from Istanbul to Trieste in Italy operated by its partner Ekol Logistics, with rail links on to Northern Europe and by truck for the final leg into the UK”.

Since the end of the UK’s Transition Period from EU trade rules since 1 January, Davies Turner has also been looking to make more use of regional ports as entry points into the UK. Williams added: “This sees us using the Channel ports a little less and moving to regional options such as Tilbury and Hull. This means we can clear on entry as well as adding a ‘drop and swap’ option for larger clients, allowing a much more flexible service to our clients and helping us combat the lack of HGV 1 drivers in Europe.”

Source: Lloyd´s