Shanghai lockdown indefinite
With Shanghai now under indefinite lockdown, the primary container port and airport are struggling with congestion and data has shown a doubling of port congestion across China since the latest lockdowns began.
Prior to Shanghai’s lockdown, around 1,000 consignments would typically arrive at Shanghai Pudong Airport each day, with a collection rate exceeding 80%, but because there is not enough trucking capacity, that pick-up rate has slumped to just 10%.
While there has been no noticeable diversion of container ships from Shanghai so far, increasing quantities of cargo is being diverted to alternative ports. including Ningbo, Qingdao and Tianjin.
Data reports in the press suggest that Shanghai container ports are experiencing “significantly reduced” volumes, with the seven-day average throughput “now down 33% and as the supply chain situation in Shanghai continues to deteriorate, the container port is running out of capacity for some types of cargo, with Maersk ceasing bookings for refrigerated and dangerous cargo.
There were 506 container vessels waiting outside Chinese ports on a day last week, almost doubling February’s figure, before the lockdown began in Shenzhen.
The lockdowns in China are adding to the congestion outside the country’s ports, as the number of container vessels waiting outside Chinese ports today now represent 28% of vessels waiting globally.
Shanghai factories that have been operating under ‘closed-loop systems’ may soon be forced to stop work due to a combination of material shortages or logistical challenges that make moving people and goods increasingly challenging, plus workers for have been contained for more than three weeks and need to be replaced.
Reduced land-side trucking capacity is effectively reducing the opportunities for cargo collections and deliveries, which means factories may not meet planned delivery schedules and we recommend checking with your vendors, to clarify the status of your orders.
To discuss the current situation in China and the options for your supply chain, please contact Colin Redman.