Posts made in August 2021

Ningbo Terminal Update – COVID shutdown – Aug-13-2021

Dear valued customers,

 

On 8/11/2021 (Wed), Ningbo terminal had a worker who tested positive for COVID-19 and is raising the specter of a Chinese port meltdown given officials’ aggressive effort to contain the pandemic and pre-existing vessel congestion in Ningbo and nearby Shanghai.

If you ship cargo with us via YML, WHL, MSC which is not calling at Ningbo Meidong Container Terminal or Meishan terminal, no impact at this moment, but risk is that as congestion builds at Ningbo, which is China’s second-largest container port, it will spread to other ports, which happened when Yantian International Container Terminals (YICT) partially shut down for four weeks from late May, congesting neighboring marine terminals in Southern China.

As of Wednesday, there were 28 container ships at berth and anchored in Ningbo, totaling 186,749TEU in capacity, there are 113 container ships totaling roughly 417,000 TEU in capacity at the Port of Shanghai, the world’s busiest cargo gateway.

With this sudden suspension, we expect a delay in planned sailings that might affect your cargo planning. The main issue is if Ningbo port is closed for some days or one week, there will be a binger impact at the other terminals too.

In addition, since there are a lot of cancelled sailings in August, some shipments will definitely be carried over to September.   If you have cargo that did not ship yet or can’t get space secured for September, the next available one would be in or after mid-October, since China’s national holiday will be from October 1st to 7th, Hence, the space in September will be VERY tight, especially the week before the holiday.

Please send your new booking to us EARLY, so it would be better for us to secure the space from carriers for you in the next few months.

Please do not hesitate to reach out to your sales representative if you have any questions. We thank you for your support!

Container shipping rates between U.S. and China exceed $20,000, hitting a record

Source from : China-U.S. container shipping rates sail past $20,000 to a record (cnbc.com)

KEY POINTS

  • Container shipping rates from China to the United States have scaled fresh highs above $20,000 per 40-foot box.
  • The acceleration in Delta-variant Covid-19 outbreaks in several counties has slowed global container turnaround rates.

 

Container shipping rates from China to the United States have scaled fresh highs above $20,000 per 40-foot box as rising retailer orders ahead of the peak U.S. shopping season add strain to global supply chains.

The acceleration in Delta-variant Covid-19 outbreaks in several counties has slowed global container turnaround rates.

Typhoons off China’s busy southern coast in late July and this week have also contributed to the crisis gripping the world’s most important method for moving everything from gym equipment and furniture to car parts and electronics.

“These factors have turned global container shipping into a highly disrupted, under-supplied seller’s market, in which shipping companies can charge four to ten times the normal price to move cargoes,” Philip Damas, Managing Director at maritime consultancy firm Drewry, said.

“We have not seen this in shipping for more than 30 years,” he said, adding he expected the “extreme rates” to last until Chinese New Year in 2022.

Rate hikes

The spot price per container on the China-U.S. East coast route – one of the world’s busiest container lanes – has climbed over 500% from a year ago to $20,804 this week, freight-tracking firm Freightos said. That compares to just under $11,000 on July 27.

The cost from China to the U.S. west coast is a little below $20,000, while the latest China-Europe rate is nearly $14,000, Freightos’ data shows.

Ding Li, president of China’s port association, told Reuters the spike followed a rebound in Covid-19 cases in other countries, which has slowed turnover at some major foreign ports to around 7-8 days.

The surging container rates have fed through to higher charter rates for container vessels, which has forced shipping firms to prioritize service on the most lucrative routes.

“Ships can only be profitably operated in the trades where freight rates are higher, and that is why capacity is shifting mostly to the U.S.,” said Tan Hua Joo, executive consultant at research consultancy Alphaliner.

Some shippers have reduced volumes in less profitable routes, such as the transatlantic and intra-Asia, said Damas.

“This means that rates on the latter are now increasing fast.”

No respite

The rate surge is the latest reflection of disruptions since Covid-19 slammed the brakes on the global economy in early 2020 and triggered huge changes to the flows of goods and healthcare equipment around the world.

“Every time you think you’ve come to an equilibrium, something happens that allows shipping lines to increase the price,” said Jason Chiang, Director at Ocean Shipping Consultants, noting the Suez canal blockage in March had played a major role in allowing firms to hike rates.

“There are new orders for shipping capacity, equal to almost 20% of existing capacity, but they will only come online in 2023, so we will not see any serious increase in supply for two years,” Chiang added.