Weak Cargo Flows and Supply Chain Changes Caused by COVID-19
First written in FY2020. 4 of 16 entries say "Worsened", first in FY2021-Q3. Latest entry: FY2026-H1.
Mitsui-Soko Holdings moved to the "Worse" side of this theme in 2021, 1 year after the typical company in this theme (2020).
2 other companies' latest entry also says "Mitigated".
- FY2026-H1MitigatedAnnual report
「The inventory adjustment phase for customers’ raw materials, parts and other items has eased, and domestic cargo movements remained broadly flat. Air cargo movements, however, were firm. ・Air and ocean freight rates remained broadly flat.」
The inventory adjustment phase has eased, and international transportation rates have remained broadly flat from the high levels of the previous fiscal year, while air cargo movements have remained firm. - FY2025-H1Inventory adjustments easing and elevated freight rates continuingAnnual report
「The inventory adjustment phase for raw materials, parts and other items at companies, which had continued since the previous fiscal year, has eased, and international cargo movements have remained broadly flat. Although freight market conditions have softened recently, ocean freight rates have remained at elevated year-on-year levels due to conditions in the Red Sea and restrictions on Panama Canal transit.」
The inventory adjustment phase that had continued through the previous fiscal year has eased, and international cargo movements have shifted from sluggish to broadly flat. Meanwhile, although freight market conditions are softening, rates remain elevated year on year due to conditions in the Red Sea and restrictions on Panama Canal transit. - FY2024-Q3Freight rate declines leveling off due to conditions in the Red Sea and restrictions on Panama Canal transitAnnual report
「Disruption in shipping markets during the COVID-19 pandemic and supply constraints on cargo space caused by reductions in passenger flights have been resolved, and ocean and air freight rates declined compared with the previous fiscal year. On the other hand, due to conditions in the Red Sea and restrictions on transit through the Panama Canal, ocean freight rates have recently stopped declining and, together with air freight rates, have remained broadly flat.」
While the previous supply constraints on ocean and air transportation space have been resolved, conditions in the Red Sea and restrictions on Panama Canal transit have emerged as new external factors, and the decline in ocean freight rates has recently leveled off. - FY2024-Q2RestatedAnnual report
「As companies continued adjusting inventories through the second quarter of the current fiscal year, international cargo volumes remained subdued.」
Following the pandemic and supply constraints, supply chain changes continue to emerge not as a shortage of transportation space but as ongoing corporate inventory adjustments and sluggish international cargo movements. - FY2024-Q1Inventory adjustment phase following the easing of supply constraintsAnnual report
「Supply constraints on cargo space caused by disruption in shipping markets and reductions in passenger flights have been resolved, and ocean and air freight rates have therefore continued to decline.」
While supply constraints on ocean and air transportation space have eased, the way supply chain-related risks are emerging has shifted toward sluggish international cargo movements due to inventory adjustments and falling freight rates. - FY2023-Q3Easing supply constraints and continued supply chain disruptionAnnual report
「We accurately identified rapidly changing customer needs resulting from supply chain disruption and secured space flexibly, resulting in higher volumes handled in forwarding operations.」
Although supply chain disruption remains, supply constraints are beginning to ease, and flexible space procurement in response to changing customer needs is leading to higher volumes handled. - FY2023-Q2Continued supply chain disruption accompanied by supply constraintsAnnual report
「Amid ongoing global supply chain disruption, we accurately identified rapidly changing customer needs and proposed alternative transportation routes and more efficient logistics.」
The form in which the risk is emerging has shifted from restrictions on economic activity caused by the pandemic itself to ongoing global supply chain disruption and rapidly changing customer needs. - FY2023-Q1WorsenedAnnual report
「Against a backdrop that included difficulty procuring parts due to lockdowns in China, exports related to automobiles remained sluggish, and the cargo turnover ratio, an indicator of cargo movements, declined slightly year on year. In addition, disruption in shipping markets, including a shortage of ocean containers, continued, while higher fuel costs and labor shortages created upward pressure on costs, leaving the outlook uncertain.」
Difficulty procuring parts due to lockdowns in China, sluggish automobile-related exports, a slight decline in the cargo turnover ratio and a shortage of ocean containers have been identified, indicating that supply constraints and logistics disruption continue. - FY2022Normalization of the pandemic’s impact and continued supply disruptionAnnual report
「During the current fiscal year, although the impact of COVID-19 on Japan’s economy has been prolonged, the Industrial Production Index has shown signs of recovery and economic and social activity is moving toward normalization. Meanwhile, although imports and exports in the logistics environment have been recovering compared with the previous fiscal year, the global disruption of supply chains remains difficult to foresee when it will subside.」
While there are signs of a shift toward normalization from restrictions on economic activity caused by the pandemic, the prolonged disruption of supply chains and uncertainty over when it will subside remain. - FY2022-Q3WorsenedAnnual report
「During the third quarter, Japan's economy was moving toward normalization of economic and social activity, and the Index of Industrial Production showed signs of recovery, although concerns remained over stagnation in consumer activity due to the prolonged global semiconductor shortage, soaring fuel costs and the spread of COVID-19 variants.」
Concerns remain that the spread of COVID-19 variants will restrain consumer activity, while the global disruption of supply chains is proving difficult to foresee when it will subside. - FY2022-Q1WorsenedAnnual report
「Recently, the recovery in economic activity has partly stalled, with the reissuance of a state of emergency in Japan and lockdowns in some Southeast Asian countries due to the spread of highly infectious COVID-19 variants, as well as delays in the recovery of production, particularly in the automotive industry, due to the global semiconductor shortage.」
The spread of variants, the reissuance of a state of emergency in Japan, lockdowns in Southeast Asia and delays in the automotive industry’s production recovery due to the semiconductor shortage have been identified, indicating that uncertainty caused by the pandemic and supply constraints continues. - FY2021Outlook for the pandemic’s impact to subside and changes in demand patternsAnnual report
「Although the impact on results from the spread of COVID-19 during the current period differs by business, we expect it to gradually subside overall over the first half of the fiscal year.」
While sluggish cargo movements caused by the pandemic continue, the outlook has shifted to one anticipating that the impact will subside over the first half of the next fiscal year. - FY2021-Q3WorsenedAnnual report
「With infections also spreading again in Japan, Europe, the United States and other countries, the outlook for the global economy remains uncertain.」
While the impact of COVID-19 continues, infections are spreading again in Japan and overseas, and the outlook for the global economy remains uncertain. - FY2021-Q2The impact of the pandemic continues, with a partial recovery in demandAnnual report
「Affected by restrictions on economic activity in Japan and overseas to prevent the spread of infection, operating revenue decreased by ¥4,578 million year on year to ¥114,617 million, reflecting lower volumes handled in ocean and air forwarding operations as customers’ production activities slowed, lower volumes handled for business-use industrial equipment and lower container volumes in port transportation operations. On the other hand, operating profit increased by ¥945 million to ¥6,718 million, as volumes handled for home-appliance manufacturers’ logistics increased with the expansion of stay-at-home consumption, while logistics demand for procuring various raw materials increased as customers resumed or recovered their production activities.」
The impact of restrictions on economic activity and slower production caused by the pandemic continued, resulting in lower forwarding and container volumes. At the same time, logistics demand emerged from stay-at-home consumption and customers’ resumption or recovery of production, so the adverse impact and recovery factors coexisted. - FY2021-Q1MaterialisedAnnual report
「In this economic environment, the group’s consolidated results were affected by restrictions on economic activity in Japan and overseas to prevent the spread of infection, including lower volumes handled in its ocean and air forwarding operations and lower container volumes handled in its port transportation operations.」
The risk of sluggish cargo movements caused by COVID-19 has materialized in the form of lower volumes handled in ocean and air forwarding and lower container volumes handled. - FY2020First statedAnnual report
「At present, we expect cargo movements to be temporarily sluggish due to the impact of COVID-19. At the same time, the impact of the pandemic is increasing customers’ need to change or review their supply chains.」
The company explained that cargo movements actually became sluggish following the outbreak of COVID-19, while customers’ need to change or review their supply chains increased at the same time.