The shipping industry has been plagued by recent disruptions, which have pushed freight rates to record highs.
The partial closure of the world’s third-busiest container port is exacerbating congestion in other major ports in China, as ships are being moved from Ningbo without knowing how long the city’s virus control measures will last.
In nearby Shanghai and Hong Kong, due to the reopening of Yantian Port in Shenzhen, the port was closed in May due to a separate outbreak, so congestion increased again. According to shipping data compiled by Bloomberg, the number of container ships docking near Xiamen on China’s southeast coast on Tuesday increased from 6 at the beginning of the month to 24.
The Meishan Wharf in Ningbo Port was closed last week after a dock worker was infected with the delta variant of Covid-19. According to a staff member of the press office who declined to give his name or any other information, the terminal, which accounts for about a quarter of the port’s capacity, was still closed on Tuesday.
The WeChat accounts of the port and provincial governments were not updated on Wednesday morning, and the City Propaganda Office did not answer the phone.
CMA CGM SA stated in a consultation with customers that it is expected that local authorities will “re-evaluate” the resumption of operations of the Meishan Wharf on Wednesday. The Logistics Intelligence Provider Project 44 stated that if it starts to reopen in phases this week to resolve the backlog, it may fully resume operations before early September.
Simon Heaney, senior manager of container research at Drewry Shipping Consultants Ltd., said that the world’s largest shipping companies, including AP Moller-Maersk A/S and CMA CGM SA, will skip Ningbo Port after the closure of Ningbo Port. These companies are more willing to transfer goods to other ports. He said that instead of waiting for an unknown length of time during the Covid-19 epidemic, it is better to wait outside Ningbo.
Some other ships are willing to wait. On Tuesday, 141 ships called at the shared anchorages of Shanghai and Ningbo ports, which is 60 more than the median from April to August.
“We heard that the backlog is increasing and the congestion is getting worse,” said Dawn Tiura, CEO of the Purchasing Industry Group of the Logistics Industry Association. “Cross-port interruptions are absolutely relevant. If you want to buy goods originating in or passing through China, you will need to extend delivery time or find other sources of supply.”
This year the shipping industry has been plagued by disruptions that have caused delays in the global shipping chain and pushed freight rates to record highs. The roar ranges from giant ships that stopped on the Suez Canal in March to virus outbreaks in Southeast Asia and China, reducing port productivity.
Bloomberg data shows that the backlog of cargo has stretched across the Pacific Ocean to the Port of Long Beach in Los Angeles, where there are more than 30 ships waiting to enter the port for unloading. Elsewhere in Southeast Asia, the number of ships at anchor outside the two largest ports in Vietnam has increased to 6 over the median.
Drewry’s Heini said: “Most ports have already encountered congestion or delays, so any additional and unsatisfied traffic will be under greater pressure.”