Weekly Update – 14.01.2022

Weekly Update – 14.01.2022
January 14, 2022 Hannah Marshallsay

Global port bottlenecks continue to hamper vessel arrivals in the UK and China’s zero-covid policy further threatens supply chains with new outbreaks prompting additional Covid-19 restrictions.

Global Port Bottlenecks Continue to Impact Vessel Arrivals

The congestion at ports worldwide that have caused disruption and delays to shipments from Asia and the Indian Sub-Continent for the last 18 months show no signs of letting up. Landside bottlenecks continue to impact schedule reliability and ships continue to sail off schedule. 

Vessel arrivals to the UK remain impacted by heavily congested European ports where carriers continue to skip port calls in an attempt to rectify schedules. Due to the ongoing berthing and landside delays at the Port of Felixstowe, carriers are still changing rotations and diverting vessels into a number of alternative ports in North Europe.

The current peak in demand is being driven by the upcoming Chinese New Year holiday on 1 February 2022. We expect to see blank sailings in early February as holiday factory closures in China will reduce demand temporarily. Due to the ongoing challenges with capacity and continued high demand, freight rates will remain high.

New Covid-19 Outbreaks in China Threaten Cargo Movement

China continues to maintain a zero-Covid strategy in efforts to urgently stamp-out outbreaks ahead of the busy Chinese New Year travel period and the Winter Olympics (which open on 4 February in Beijing). While Ningbo is now slowly recovering from its latest Covid-19 disruption, new outbreaks have already spread to Tianjin.

Tianjin, near the capital Beijing has become the latest port city to have a strict lockdown imposed. The city of 14 million has undergone mass testing following the detection of 97 cases to date in the region. Rising coronavirus cases have forced Tianjin port to tighten restrictions on truck drivers entering its container terminals, disrupting operations at the port, the largest in North China. The port’s measures are part of the travel restrictions introduced by the government to curb the domestic spread of the virus. At this point in time the measures imposed have had minimal impact on productivity at Tianjin port but we are seeing some impact on the movement of cargo for some of our customers’ shipments. We will notify customers that have been affected at the earliest opportunity.

On a positive note, in the last week, operations at Ningbo port have improved with container gate operations having been restored. However the disruption to landside operations is taking longer to recover, but we expect normal operations to resume in the next week.

There will be continued uncertainty about new outbreaks impacting the ability to move cargo in the coming month. China’s continued use of a zero-tolerance policy towards Covid-19 risks further disruption to manufacturing and supply chains in the coming weeks. As we are now in the peak season for exports ahead of the Chinese New Year, regrettably, it is likely that some shipments will be impacted by this disruption.

 

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