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Chinese export cargo volume is reduced, and the 3 main shipping alliances will cancel one-third of the voyages in the next few weeks to maintain the integrity of the sailing schedule. And can reasonably keep the freight at a high level.

12 May 2022

By Arthur Chen.    Photo : Mika Baumeister 

Vietnam will add 10 more terminals, Cambodia plans to build a $1.5 billion seaport. Vietnam, as an emerging supply chain outside of China is overwhelming on.

Market sources pointed out that the three main shipping alliances are preparing to cancel more than a third of their sailings in the coming weeks in response to a reduction in export cargo volumes. After the newest outbreak of the covid-19 in China in the first quarter of this year, shipping lines implemented a variety of mixed blank sailing strategies to maintain the integrity of the sailing schedule. The percentage of outages for the world's three largest container shipping alliances has varied between 17% and 55% this year. Carriers still use blank sailings to better control their capacity, achieve schedule integrity and ensure capacity is available in the right places. The average percentage of blank sailings in the 2M Alliance is expected to be 39% between Weeks 17 and 23 because of a drop in demand due to the lockdown in China. Ocean Alliance will have about 37% blank sailings and THE Alliance will have 33% blank sailings.

After the lockdown in Shanghai, the dwell time of imported containers in Shanghai Port reached its peak at the end of April, while the dwell time of export containers was relatively stable, about 3 days. Imports stay too long because truck drivers are unable to haul out containers in time. And less export cargo at the port means fewer containers can be shipped from Shanghai, reducing export dwell time. Since the Chinese New Year holiday, the good news was that the congestion at the Port of Long Beach in Los Angeles had improved. According to the official website of the Port of Los Angeles, as of May 9, a total of 36 ships were waiting to berth outside the two ports. The average waiting time was 2.6 days. However, rail service transshipment from the port of Los Angeles to inland ramps are still time wasted, with at least one to two weeks to complete. And, the improvement in Southern California's port conditions may not be sustainable, as upcoming labor contract negotiations at West Coast ports could leave dockworkers short, reduce port efficiency and ship longer queues during the summer. As some Chinese factories resume normal production, a large number of containers will be shipped to U.S. shores, which could further create problems in an already strained intermodal system. In the United States, good news doesn't always last long, and new challenges are the norm.

Vietnam will add 10 more terminals. Cambodia plans to build a $1.5 billion seaport! The Ministry of Transport of Vietnam has just issued Decision No. 552/QĐ-BGTVT on the publication of the list of ports and terminals in Vietnam. Following this decision, 10 new terminals were included in the Vietnam Port Directory, raising the number of terminals nationwide to 296. The Vietnam Maritime Safety Administration revealed that in the context of Vietnam's deep integration into the international community, Vietnamese seaport system has given full play to its role as a hub for trade in goods. In the first quarter of this year, the seaport's cargo throughput maintained a steady upward trend, reaching nearly 180 million tons, an increase of 4% over the same period in 2021. Among them, the container cargo transportation volume maintained a growth rate of 6%, reaching 6.2 million standard containers. Cambodia, on the other hand, has begun construction of a seaport in Kampot province with a private sector investment of $1.5 billion. The multipurpose port will help complement Sihanoukville, another major port in the region. By 2025, after the completion of the first phase of the project, the port will have a production capacity of 300,000 TEUs, with an investment of nearly US$200 million. By 2030, when the total construction is completed, the production capacity will reach 600,000 TEUs. The port has a draft of 15 meters and is capable of accommodating ships of 100,000 tons. The port will be connected by water, land and rail to the capital Phnom Penh and other provinces via national highways and the Phnom Penh-Sihanoukville Expressway. It will also be connected to the north of the country by the Southern Railway. The port will promote the implementation of the master plan to develop Sihanoukville into a multi-functional special economic zone in accordance with Cambodia's 2015-2025 Industrial Development Policy. Cambodia has signed free trade agreements with China and South Korea and is negotiating free trade agreements with a number of other countries, which could significantly boost domestic and foreign trade.

Beginning this year, China has locked down cities to cities, which has had a huge impact on the economy, and the production of goods has been reduced. On the contrary, Southeast Asian countries are grabing the opportunity and actively promoted the import and export of trade. Although Chinese cities locked down have brought a serious supply chain disruption crisis to the world, it is an unprecedented growth opportunity for Southeast Asia, especially Vietnam. Vietnam as an emerging supply chain outside of China is unstoppable.

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