In the member spotlight this week is Aziz Oztoprak, head of sales freight forwarder Nordic Transport Group (NTG), who shares his shares his insights on market trends, as well as tips for how exporters can ensure smooth collaboration with a freight forwarder.
Formed in 2011, NTG has expanded from Denmark into 27 countries, moving goods from food and fabrics to automotives and beauty products all over the world.
Offering services including ocean, air and road freight, NTG has had to get to grips with mass uncertainty amid US tariff threats.
Trump’s impact
Despite the US’ recent tariff-reduction deals with the UK and China, Oztoprak is unconvinced that the “uncertainty” tariffs have created in global trade is over just yet.
He said that trade volumes “have substantially dropped between the US and UK”, and added that “the overall volume of global trade we do” has been 15-20% lower each month, year-on-year, since ‘Liberation Day’.
Many clients have had to cancel or postpone bookings, even when contracts were in place, with Oztoprak “still waiting for some clients to tell us what they’re going to do”.
He describes abrupt vessel cancellation in which “17-18,000 containers have been left, just dumped” and a “shockwave through the whole system”, in which a number of jobs throughout the supply chain are jeopardised.
He believes the ongoing uncertainty will hinder businesses in spite of Trump’s recent reversals:
“You've got to plan to do business anywhere or spend money on something new – reinforcing your sales team or your operations – you put all that on hold because obviously what has happened, in the event of this tariff”.
Freight rates
One unsurprising knock-on effect of Trump’s policy was “plummeting” freight rates, a recent boon for trade between China, the UK and Europe, Oztoprak says.
Some shippers “reduced rates substantially” in the aftermath to account for otherwise “completely empty vessels” heading to North America, diversifying into Europe at lower rates.
He says that, while rates for a 40ft container are now around USD$1750, as of May, they were fetching nearer $3,500 prior to tariff announcements.
However, he adds that shipping disruption over the past few years, most notably diversions to avoid the Suez Canal, has prompted significant air freight growth – increasing 6% last year.
However, this growth hasn’t been spread easily. Given the lack of access to Russian airspace, European airlines haven’t made the most of this. Anecdotally, he says about 85-95% of air freight coming out of China is operated by Chinese airlines.
With Chinese cargo planes “chock-a-block pre-booked” and less European options, this also created shortages last year.
“There was time we didn't have any space for couple of days, not even weeks.”
This demand drove freight prices “substantially” to US$7 per kilo. However, this has now dropped, stabilising at nearer US$3.
Impact of new shipping tax on ports
We’re also set to see larger changes in shipping in the coming years, as the International Maritime Organization (IMO) agreed to a global emissions tax on the sector earlier this year.
From 2028 large vessel owners will face a penalty of up to US$380 per tonne of carbon dioxide emitted by burning fuel.
Oztroprak suggests that, in addition to seeing a shift towards larger, hydrogen-fuelled vessels, that biggest impact could be for ports, as larger vessels can only stop at larger ports.
“The number of ports they're calling on is going to be reduced, which is why [ship manufacturers] are building such big vessels.
“You’ll have those big main hubs – like Rotterdam – and then feeder users taking the containers from those hubs to smaller ports.”
He notes that while the port of Rotterdam is building more terminals to create the capacity to manage this anticipated increase in volume – “it should be completed in 2027” ahead of the tax’s 2028 implementation – smaller ports will lose out:
“It's going be detrimental to smaller ports – you’re having smaller vessels coming in, your revenue’s going to be much less that it was previously”.
Customs tips
As part of their service, NTG also handles customs on behalf of its clients.
Asked what’s most likely to cause unnecessary problems and delays when it comes to communicating with a freight forwarder, Oztoprak advises firms to keep an eye on their classification codes, considering that UK customs authorities regularly revise codes and requirements. He says:
“HMRC actually update the tariff every three months.
“They’ll go through everything: trade lines, trade agreements, each country’s data and evaluate that information, and then update the HS codes”.
These codes are foundational to a smooth customs experience, determining documentary requirements and duties paid, meaning that sharing the wrong code with your intermediary can cause delays, as well as over or under-payments of duties.
Aside from incorrect classification, Oztoprak says that choosing the appropriate number of digits for the destination country is also often overlooked. He notes the UK has 10-digit HS codes, whereas other countries have 12 or 14.
In this instance, as well as many others he says “a good forwarder agent will advise their customers… be honest with them and say your product’s going to be stopped at customs”.
But it isn’t possible to “dictate” to the customer and simply “tell them what to do, what type of code they should be using”.
Popular products
Reflecting on current trends in UK goods shipments, Oztoprak says that ‘brand Britain’ is doing well, with iconic products exported in higher numbers.
This includes Scottish salmon, which he says is being shipped to China in high volumes, “when we used to ship very little”.
Scotch whiskey is also hugely popular, although he notes a shift in trade flows since Trump announced his ‘Liberation Day’ tariffs, with “China and India taking over” the highest volume of whiskey imports.
His comments are a strong endorsement of the UK’s geographical indicators, which protect regionally-specific export from being imitated abroad – a point echoed by Chartered Institute sanitary and phytosanitary (SPS) expert Joseph Goldsworthy in our recent food and drink Special Interest Group.
Reflecting on other regional strengths, Oztoprak also says that “a lot of fabrics go out of the UK” and notes that there are a lot of manufacturers from Yorkshire and Huddersfield exporting, with increasing demand from the Middle East.
Beauty products are also being exported, despite a recent trend for UK consumers to purchase South Asian and US brands. Beauty goods made in places like Cambridge and Kent are being sold overseas.
Chartered Institute of Export & International Trade members have access to a wealth of industry insight and expertise, in the form of exclusive events, webinar and resources. To learn more about how membership could benefit your business or support your trade career, click here.
Member exclusive
