China Post staff members unload parcels of daily necessities for quarantined residents at home from a minivan in Shanghai, China, May 14, 2022.
Tian Yuhao | China News Service | Getty Images
Shanghai implemented massive quarantine measures this past weekend, including highway closures, severely impacting trucks exporting to the city’s port, according to logistics company Orient Star Group.
“Trucks loaded with cargo and containers were unable to enter the Shanghai terminal,” said the company, which also contributes to CNBC’s supply chain heat map. Heat Map is a new data tool created by CNBC with 13 of the world’s top maritime and logistics data providers to give investors a better insight into inventory flows in real time.
“Many customers have no choice but to change loading ports to Ningbo or other smaller ports along the Yangtze River.”
Port of Ningbo, which became alternate port destination, now showing increase in congestion covid Cases keep coming up in some districts of Shanghai.
“Production and construction in Shanghai has basically resumed, but once quarantined, transportation and dredges are affected to some extent,” Orient Star Group said.
DHL Global Forwarding told CNBC finding truckers in and out of the Shanghai area is still a challenge.
During the lockdown, a slowdown in trucking led to a shortage of raw materials for companies such as Volkswagen and Tesla. Prior to the latest restrictions, truck drivers were still required to provide a nationally recognized 48-hour negative COVID test result and traffic permit, said Akeel Nair, Seiko Logistics’ vice president of global carrier management and ocean strategy for Asia-Pacific. he said. In practice, he said many local governments have also demanded that the tests be redone at the local level and on highways.
“Some drivers are cautious about deliveries in Shanghai and capacity has not yet fully recovered to pre-lockdown volumes,” he said.
The latest quarantine restrictions come at a time when trucking capacity has grown to around 80%.
Orient Star Group is also seeing pickup in West Coast Cargo, which was trending down. Many logistics experts were predicting that it was a forward indicator of container boom. Containers bound for the East Coast remain strong and stable.
This weekend people in 15 of Shanghai’s 16 districts were ordered to be tested for the fast-spreading Omicron variant. Five districts barred residents from stepping out of their homes.
Districts include Pudong, Ghar TeslaKey Gigafactory, Merck, Covestro, L’Oreal, Thermo Fisher, SC Johnson, Siemens, Bosch, SAIC-GM and Advanced Micro-fabrication Equipment; and the special chemical manufacturing district of Zhuhui. Apple, SonyAnd Volkswagen Everyone has said that Shanghai’s “zero COVID” restrictions have affected the supply of materials needed to make their products.
Jing’an District is home to many semiconductor and electronics manufacturers.
US ports suffered a setback
The increase in West Coast cargo comes at a time when ports in the West are slowly processing import containers due to a lack of rail options and trucks are being used as temporary warehouses.
Overcrowding at the ports of Los Angeles and Long Beach, Calif., has affected the Port of Oakland, Calif., which has been abandoned by maritime carriers who want to make time on their schedules. This is affecting the volume of US export containers leaving the port. Logistics managers are also trying to gain some control by moving more containers to the East Coast and Gulf Coast. Now those ports are also closing.
Mirko Voitzik, director of intelligence solutions at Everstream Analytics, said: “The measured congestion in the number of cargo ships waiting outside major ports is now worse on the East and Gulf coasts than on the West Coast, a major change compared to early 2022. Is.” ,
To keep up with growing container volumes, the Port of Houston recently announced Saturday gate hours for the rest of the year. Warehouses at the port of Savannah, Georgia are 99% full and are using their pop-up container storage lots to free up land capacity.
“2022 is showing us that East Coast ports are very susceptible to overcrowding,” said Project44 chief development officer Brian Bourke.
Europe labor struggle
Last week, a consortium of port operators in Germany complied with its “warning strike”, which disrupted one of the afternoon shifts at the ports of Emden, Bremen, Bremerhaven and Wilhelmshaven.
Negotiations are ongoing between the union ver.di, which represents about 70% of the port workforce, and the Central Association of German Seaport Companies.
The system is already under stress and any loss of manpower will only lead to congestion, said EMEA Andreas Braun, Ocean Product Director at Crane Worldwide Logistics.
“Feeder operators see delays of up to five days waiting for berths to pick up their containers, and round trips between Rotterdam – Dublin – Rotterdam have increased from six to nine days. More by feeder operators to keep schedules The injecting vessels need to be somehow reliable,” Braun said. Rotterdam is in the Netherlands.
The port of Hamburg in Germany, Europe’s third largest container port and largest railway port, is important for autos. BMW, Rolls Royce, Volkswagen, Michelin and Wade Export products ranging from fully assembled automobiles to parts and lithium batteries. Other major exporters include IKEA, BASF, Siemens and Bayer.
CNBC Supply Chain Heat MOneThe P data providers are artificial intelligence and predictive analytics company Everstream Analytics; global freight booking platform Freightos, creator of the Freightos Baltic Dry Index; logistics provider OL USA; supply chain intelligence platform FreightWaves; supply chain platform Bloom Global; third-party logistics provider Orient Star Group; marine analytics firm MarineTraffic; Marine Visibility Data Company Project44; Maritime transport data company MDS Transmodel UK; Ocean and air freight benchmarking analytics firm Zeneta; C-Intelligence APS, a leading provider of research and analysis; Crane Worldwide Logistics; and air, DHL Global Forwarding, and freight logistics provider Seiko Logistics.
— CNBC’s Gabriel Cortes contributed to this article.