Despite key Chinese ports, including Shenzhen and Shanghai, operating normally, land-side logistics disruption, in the wake of the latest Covid-related lockdowns is inevitable and vessel queues are growing.

Queues of container ships outside major Chinese ports are lengthening, despite ports continuing to function normally - though with limited capacity - because many of the most profound problems lie on the landslide, with the strict Covid measures hampering trucking productivity, making it difficult to get cargo to and from the ports.

Vessel waiting times at Shenzhen terminals has grown longer, with an average wait of three to four days at Yantian International Container Terminal (YICT) and five to seven days at Shekou Container Terminal.

The spread of the highly-infectious Omicron variant this month has led to movement controls across China, which is debilitating transport operations and the ability of drivers to collect and deliver. So while ports remain open and vessels are continuing to dock, congestion is building up and some container ships are re-routing to avoid expected delays.

The current developments around Covid lockdowns in China and sanctions imposed on Russia is creating more supply chain uncertainty and congestion will go up as delays extend, which means we will work even harder to get our customers’ cargo moving around those obstacles.

Shenzhen city reopened on Sunday and while the Yantian container terminal continued operating throughout the lockdown, the impact on ocean freight is due to trucking restrictions when picking up from outside Shenzhen, or in a locked-down area.

Even with ports open, the lack of terminal handling staff and expected trucking delays are compelling some carriers to skip calls, or accept they will keep vessels waiting.

Maersk will skip calls at Shenzhen on three sailings later this week after the port imposed restrictions on cargo exports to limit congestion in the container yards at its western terminals.

Trucking capacity between Shenzhen and nearby cities is estimated to have dropped by 20%, or even more in some regions, due to the need for drivers to produce a negative test, which means longer delivery times and a possible rise in transport costs such as a detour fee or a highway fee.

Cross-border trucks between Shenzhen and Hong Kong are also affected, with capacity dropping by at least 70% as authorities impose tougher quarantine and testing requirements on drivers, with long waiting times, leading to transport by ocean to overcome the limited truck capacity. 

In Qingdao, terminals are still operating, but port productivity has dropped due to tightened coronavirus measures, with more than 70 vessels waiting to berth, double the number in February.

In Shanghai, which was said to be on the brink of lockdown and already imposed restrictions on passenger flights, warehouses and terminals operate as normal, but require the driver to be tested within 48 hours before delivery which is limiting trucking capacity and caused some shipments to be moved out of Ningbo.

Meanwhile, there have been reports of lengthening ship queues outside Chinese ports, with 262 vessels waiting outside Shanghai and Ningbo, up from 243 last week.

Supply chains have never faced so many challenges and with local conditions changing rapidly it is critical that you have the support of dependable partners. 

Metro will always share the latest news and most important developments, providing you with the best alternatives and options, to keep your supply chain optimised. 

For further information and to discuss your ongoing requirements please contact Elliot Carlile.

We continue to monitor the situation daily, which is very fluid, to update our advisory…….please look out for our announcements, or speak with your Metro account manager for the latest information.