By Ashley Kao.    Photo：Zbigniew Bielecki

The risks and challenges of the shipping industry before Chinese Lunar Year 

Due to the Omicron Covid-19, the world still not be able to get rid of the pandemic in 2022. The uncertainty of ocean and air freight rates. The spot rates will increase in all main ocean routes, and it is only the basic freight rate. It is expected that the demand will increase before the Chinese Lunar Year, the rates will increase again. The air freight rate market is also outrageous. Many cargo owners choose air freight due to the shortage of ocean space, resulting in a shortage of air freight capacity and soaring rates.

Another is the uncertainty from Vietnam. Although the country has reopened, Vietnam’s recovery is still slow. In addition to the impact of Omicron, workers will not return until after the Lunar year. This is normal at this time of the year, but the pandemic has made is even more obvious. Vietnam is dealing with the supply chain challenges that all countries are facing with.

The below is the feedback from China and Southeast Asia branches in week 51,

Shenzhen

Seaports: The seaports are required for reservation, there has time limit for returning containers. Some areas have been locked down because of Covid-19, it has some impacts on shipment in Dongguan. The space is critical, the rates keep increasing.

Airports: Some flights from Shenzhen, Guangzhou, Hong Kong to South Africa have resumed (HKG: ET/QR, CAN: SQ, SZX: TK). The space is tight, the freight rate increased.

Hong Kong

Airport: The Space to U.S.A. is still critical. The air rates to U.S.A. dropped a little bit compared to last week.

Seaport: Port operations are normal, there are occasional shortages of containers.

Shanghai

SEA: Many vessel schedules have been cancelled from SHA to US/Canada routes in Dec, and the remaining 80% spaces were bought by major cargo owners. The space issue is critical, the freight rates keep increasing. Jaingsu, Zhejiang and Shanghai increased the difficulty of inland transportation due to the Covid-19 regulation.

(The drivers who go out of Shanghai or enter to Shanghai must provide the ID and Covid-19 test result. The test report only valid within 48 hours. In Shanghai, the test will be done in the first day afternoon. The test report will not be available until the afternoon of the second day, which means it’s 24 hours past after the test. Vehicles basically don’t pick up cargos in a long distance. When cargo loaded in Jiangsu and Zhejiang, it needs to be loaded immediately when drivers arrived at the factory, they cannot stay overnight. Otherwise, drivers won’t be able to return Shanghai in time, or they need to do the Covid-19 test again at local. Some high-risk cities are not allowed to do loading, drivers who went to high-risk cities cannot return to work.)

After the new rules of dangerous goods implemented, there are shortage of qualified packing manpower and the warehouse for dangerous goods.

Xiamen

The current space is few, especially to Canada route. The freight rates keep increasing, and the shortage of containers are getting more serious.

Ningbo

The Covid-19 cases eased in Zhejiang last week, many workers have returned to work. Shangyu District of Shaoxing and Xiaoshan District of Hangzhou still under regulation, but the situation is getting better and better. The space is still critical, the rate keep increasing, and the shortage of empty container is getting serious.

Tianjin

As New Year and CNY coming soon, the freight rates keep increasing. The space is critical, there is a serious shortage of 40HQ containers. 

Dalian

The current space is critical, and there are large shipments are waiting for export. Many companies rush to meet shipping deadlines before CNY.

Qingdao

Due to the holidays of Christmas, New Year, CNY, the space is critical, especially to US IPI point which is even more difficult to get a space. The vessels delayed around 4-5 days; few vessels delayed for 2 weeks. Close to CNY, the truck fees have also increased.

Vietnam

Freight rate to USA is increasing by daily and space is critical, bookings are sold out within hours.

Thailand

The New Year’s holiday is from 12/31 – 1/3 in Thailand, the exporters try to clear the pending shipments before the end of the year, however, the space is critical and port congestion at origin ports. Most carriers are fully booked until the end of Jan 2022.

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