Global Trade Fears as Covid Hits Major China Port

Date: 13 August 2021 - 22:00

News ID: ۹۳۳۳۶

LONDON (Dispatches) - The partial closure of one of China’s biggest cargo ports due to coronavirus has raised fresh concerns about the impact on global trade.
Services were shut at a terminal at Ningbo-Zhoushan port after a worker was infected with the Delta variant of Covid-19.
Ningbo-Zhoushan in eastern China is the world’s third-busiest cargo port.
The closure threatens more disruption to supply chains ahead of the key Christmas shopping season.
Closing the terminal on Meishan island until further notice will cut the port’s capacity for container cargo by about a quarter.
It comes as the cost of shipping from China and South East Asia to the East coast of the U.S. has already hit a record high, according to the Freightos Baltic global container freight index.
And some UK businesses were already feeling the pressure of much higher shipping costs.
Jason Chiang from Ocean Shipping Consultants told meida that the global shipping industry is likely to feel the impact of the pandemic for several more months.
“We don’t expect to see any new shipping capacity until two years down the road. So everything between now and two years will be dependent on how the pandemic plays out,” he said.
Ningbo-Zhoushan is the world’s third-biggest cargo port after Shanghai and Singapore.
For people trying to ship goods from East Asia to Europe or the U.S, it’s one blow after another.
The Covid crisis put the container shipping industry under intense pressure by knocking normal patterns of supply and demand out of kilter.
Then came the Ever Given, which blocked the Suez canal for six days, delaying hundreds of vessels and causing knock-on effects that lasted for weeks.
And on top of that, partial closures of key terminals in China - at Yantian earlier in the year and now Ningbo - have caused further disruption.
Each time something like this happens, it can trigger further problems, including congestion at other ports - many of which are already operating at a slower rate than usual due to Covid restrictions.
Shipping lines are pretty happy, because container rates are sky high. For importers it’s a different matter.
“Perfect storm” is an overused cliche, but right now it’s a good description of what’s going on in the industry. Certainly this is more than merely a case of choppy waters.