May 2021

The CORONAVIRUS pandemic and Brexit have shown how tenuous and fragile can be the supply of goods from both the Far East and even from as close to home as Europe.

The well-oiled container industry out of China for instance has stalled extremely badly in the last 12 months and this has exacerbated similar worries that have been engendered around shortages associated with Brexit. Leading container shipping lines’ interim financial reports show sharp increases in freight rates now and when compared to Q4 2020. With demand likely to remain high, and additional container capacity not due for a few more years, then IMF projections are that container shipping rates will remain excessive until new vessels begin to be delivered in 2023.

These record-breaking freight rate rises, experienced from the second half of 2020 onwards, were the consequence of a confluence of extraordinary factors. This including a sustained demand surge, caused by the pandemic, away from services and over to goods. The resultant supply chain disruption reduced port efficiency which in turn diminished the availability of equipment and restricted capacity in the market. Added to this is the ‘hangover’ of BREXIT and the resultant increased costs and regulation associated with importing into the UK. Many European manufacturers are simply not prepared to stomach the extra costs and time consuming, additional paperwork and hassle that now comes as ‘standard’ in trading with the UK.


All of this may well manifest itself in a significant repatriation of production and an enhanced manufacturing base back in Britain.


Personally, I sit on a regional industry forum in association with a national bank and other industry figures. Three out of six wholesale companies represented on the forum, all from different industries, are currently looking to re-source their requisite products back to UK manufacturing.

As a result of all of the above then I believe that we can look forward to a fundamental change in the pattern of UK industry procurement. A change in which a British made, value for money, and reliable source, may significantly replace the increasingly dubious benefits of purchasing from an ever more problematic and expensive import model.

In anticipation of this potential procurement switch then DAVANT are considerably developing our manufacturing base within the UK and to be, as far as is practicable, self-sufficient in terms of the products that we market. As with everything that we do then this is designed to be for the benefit of our customers and hence the ultimate sustainability of our business.

My thanks to you, as always, for listening.

David Merrick

Group Managing Director