Corona Virus (COVID-19) - Information of Abifor AG:
Up-Date Emergency Plan and Supply Chain
Dear Customer, dear Business Partner
In view of the special situation regarding the coronavirus (COVID-19), we have taken important precautions to protect the health of our employees, customers, suppliers and partners. These go one step further than the guidelines prescribed by the local and federal authorities.
Emergency plan at Abifor AG: In the last two weeks Abifor has implemented an emergency plan in the whole company which will take place until mid of April 2020. This action plan drawn up by Abifor AG concerns the maintenance of business activities on the one hand, and on the other hand it allows most employees to do their work in home office mode and our employees in the factory work in independent two shifts. In order to guarantee the security and reliability that have characterized Abifor AG for many decades, all important functionalities will be continued right now.
Travel restriction: In order to prevent the Corana virus from spreading further and to protect our employees and our business partners as a precaution, the emergency plan of Abifor AG also provides for travel restrictions. Travel to so-called risk areas and visits by business partner (customers and suppliers) in our Headquarters and German plant are prohibited. In addition, the restrictions of local and state authorities must be strictly followed. When the border is closed by the authorities travel outside the country’s borders is also prohibited.
Critical issue: Supply chain disruption is moving east to west with the spread of the virus and the increase in numbers of cases in Italy, Spain, France, Germany, Switzerland and some Eastern European countries.
For your further information: Here is a summary of what you need to know about COVID-19’s impact on global supply chains this and the next week.
Volatility in Europe and the US: New travel restrictions announced in the United States on flights from the EU will have a significant impact on capacity. More than 40 % of cargo capacity from mainland Europe (excluding the United Kingdom) is belly space on passenger aircraft, according to Seabury, and air freight is currently 51 % of total Transatlantic trade value.
Going into the week of March 16, we can expect capacity shortages and considerable increases to spot price rates both inbound and outbound Europe/US. That said, space is available, with certain constraints like premium rates and no transit time commitments.
We have also seen knock-on effects in other regions. For example, in Hong Kong, we have seen a sharp increase in rates to both Europe and US triggered by new entry restrictions to US. Charter rates, as an example, have surged by up to 50 % in the last 36 hours.
Some recovery in production in China: Until now, those originating in Asia-Pacific have felt the impact most acutely. From late January until last week, production and cargo movements in China were down significantly. However, we are now seeing operations return to normal at ports, airports, trucking networks, cargo terminals, manufacturing and assembly plants, etc. Production in China is at 60-80 % as of mid-March and factory restarts are taking place every day and should be close to 100 % by the end of March beginning of April.
Capacity constraints to/from China: There is a continued squeeze on air freight to and from China to all regions, because of the large number of flight passenger cancellations in the market. Flight cancellations have removed more than 5’100 tons of capacity from China per day on average. Cargo capacity from China is 50 % lower than this time last year, according to Seabury.
Capacity constraints on intra-Asia trade lanes: Freight rates on Intra-Asia lanes are extremely high and volatile, and have been increasing rapidly, which in turn is also affecting the long-haul export capacity to both Europe and US.
Capacity constraints in the Middle East: Intra-regional capacity in the Middle East has been significantly reduced due to the cancellation of all passenger flights to/from Kuwait, and for selected airlines for Saudi, Bahrain, Qatar and Egypt. Intra-regional passenger flight capacity is being substituted by freighters, which are still allowed to fly to all counties in the Middle East.
Blank sailings, equipment shortages when it comes to ocean freight: Ocean carriers have blanked sailings and we are seeing imbalances in container and breakbulk ships, containers and other critical equipment. It will take some time for that to sort itself out and reach equilibrium.
Abifor AG do everything to continue to guarantee you the best possible service and supply of our quality hotmelt adhesives. However, there may be a little longer waiting time to answer your inquiries and maybe there are some postponing of deliveries due to the actual critical supply chain situation.
Our decision to implement the emergency plan was made against the background of great responsibility towards the population and society. We are firmly convinced that in such an exceptional situation, protecting health from economic or other motives has priority.
For further information please do not hesitate to contact the respective person at our team.
We thank you from the bottom of our hearts for your understanding. We very much appreciate the trust you place in Abifor AG every day.
With best regards
Dr. Rolf L. Wickihalter