Container shortages in China

Port operations have been severely diminished and inland distribution massively disrupted by the coronavirus, lockdowns and safe-working practices, which delay the unloading of containers and repositioning of equipment back to China.

As European importers struggle to return empty containers to China, fears grow of container shortages threatening supply chains in the current peak shipping season.

The unexpected demand spikes in July and August that followed the reopening of the economy, has left carriers struggling to reposition empty containers in Asia and especially China.

Containers of all sizes are increasingly in short supply, with Maersk CEO Søren Skou confirming that equipment has been stuck in Europe and the US and is slow in finding its way back to Asia. Though he was quick to stress this did not apply to Maersk.

We are seeing equipment shortages of 40ft HC primarily, but also 40ft GP’s in Shanghai, Ningbo / Southern China. 

This experience continues in North India markets, though this is primarily due to ongoing lockdown and limited transportation to reposition.

Regional weather conditions are adding to the repositioning problems, with typhoons and fog throwing vessels off schedule across Asia, resulting in vessels skipping ports and not dropping off empties, adding to the shortages.

Some fear that the equipment shortages may be exacerbated by strong demand in the US for electronics, e-commerce and medical equipment, lasting into October, and possibly beyond.

We are keeping our customers informed of the evolving situation and will continue to work closely with our customers and overseas partners to get good accurate forecasting. 

We are encouraging customers to apply for EIR’s (Equipment Interchange Receipt) as early as possible, as this greatly improves the likelihood of getting the right equipment positioned promptly. 

We also make use of alternative and adapted solutions, to keep supply chains operating optimally, including combinations of 20’ and LCL and also air freight / sea air options for urgent cargo. 

It is during supply chain challenges that the value of Metro’s MVT tool is clear. Its real-time visibility gives customers control (down to item level) and the intelligence to take date-driven decisions confidently.

Finally, we reiterate the need for shipping forecasts providing visibility so we can ensure we are well positioned to cover the container equipment shortage.