Home »News & Events» Holiday Shopping Disruptions: Chinese Port Closure Raises Fears of Further Delays in Global Chain
China partially closed the Meishan terminal at the port of Ningbo-Zhoushan, the third busiest port in the world. The closure has raised fears of major disruptions in the chain of origin. This is another example of the suspension of the activities of a chinese main port in the country this year. By June, COVID-19 had affected activities at the ports of Guangzhou and Shenzhen.
In a study note, Nick Marro, head of global industry at the Economist Intelligence Unit, said that as long as the Chinese government adheres to a zero-tolerance technique for COVID-19, the threat of “sudden interruptions caused by testing or lockdowns will persist. “. ” China has noted a resurgence of COVID-19 cases, and official knowledge recorded 140 infections on Aug. 16, the most infections since January.
“The company will actively negotiate with the ship owner (. . . ) and will prefer to divert ships due to a stopover in Meidong (part of the consolidated Meishan area) to other port areas,” Ningbo Zhoushan Port Co Ltd said in a statement.
The other terminals are operating normally. However, they only accept reservations for boxes intended for export, as long as such reservations are made within two days prior to the arrival of the vessels, which is done to reduce delays and restrict the number of other people on site. Last year, Meidong processed 5. 44 million twenty-foot sets (TEUs), representing about 17% of the total container handling volume in Ningbo.
Maersk, the world’s leading container line, has announced that it will route some shipments to other terminals in Ningbo, which would prevent mooring at the port. Three shipments from Hapag-Lloyd will skip Ningbo this week. At the Port of Shanghai, the government tightened disinfection and quarantine procedures following the report of Ningbo infection. Port operations have been affected.
In an interview with CNBC, Dawn Tiura, CEO of Sourcing Industry Group, a deal for the sourcing and sourcing industry, said the June COVID-19 outbreak forced Shenzhen’s Yantian port to cut its exports by 70%, a resolution that tripled. the waiting time for the processing of shipments, until the days of the last 3 days.
“If we revel in something similar here and the time it takes to move ships to port twice or triple, we will see a really extensive and long-term effect on exports that will affect the holiday grocery shopping season and increase inflation. . . . Container shortages were already weighing on global supply chains. Since Ningbo-Zhoushan is the third largest container port in the world, this closure aggravates an already bad situation,” Tiura said.
In an interview with the Washington Examiner, Peter St. Onge, an economic policy researcher at the Heritage Foundation, noted that since China is a major manufacturer of intermediate goods used to produce final goods in other countries, shutting down Chinese port traffic would have a significant effect on other countries’ productive sectors.
“For example, retail inventories in the U. S. U. S. They represent a third decrease from what they usually are, and approximately 30% of companies, in general, report interruptions in the chain of origin; if this moves away from production and construction, the figure approaches 60% . . . The closure of the port, and possible long-term closures, would only add up to that,” according to the outlet.
Containers have skyrocketed in recent months. The reference charge for a shipping container from Shanghai to Los Angeles is now $10,322, up 220% from last year. more than before the COVID-19 outbreak. The Baltic Dry Index (BDI), which serves as a global benchmark for bulk shipping, is up 10% from last month.
In China’s existing five-year plan, the port of Ningbo-Zhoushan is considered a jewel in the infrastructure of its home chain. The local government was invited to announce it as a “world-class port trading group”, centres of construction studies, services and industries. Last year, the port treated 283. 2 million sets equivalent to 20 feet of container capacity, double the volume treated through the port of Rotterdam in the Netherlands, the largest container center in the Western Hemisphere.
Arvind is an inmate who prefers to stay away from the highlights as much as possible. In any case, it largely monitors and reports what it is to keep other people well informed.
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