Container News reported on November 6, 2020, that equipment shortages at a majority of Chinese ports have intensified over the past few weeks, with vessel delays adding to the congesting problems. US West Coast Ports and Midwest terminals such as Chicago Rail Ramps, in particular, are struggling to cope with the surge and bottleneck occurring at the ports.
Many containers arriving at the ports, specifically LA/LGB, are needing transport inland which has tied up chassis equipment, leaving containers to pile up at the port awaiting to be pulled, causing additional congestion issues. Picking up containers at the ports has become more problematic, as truckers are facing long lines and spending more time searching/waiting for equipment and waiting for congestion to ease to retrieve the containers.
Additionally, steamship line performance is at all time low. Sea-Intelligence reports, ‘Vessel schedule reliability, for all the carriers, has taken a hit. Global schedule reliability plummeted in 2020‑Q3 to 65.0%, which is the lowest global quarterly schedule reliability recorded by Sea‑Intelligence and is lower by a considerable ‑14.6 percentage points year-on-year, nine of the top 15 lines are recording reliability statistics of 65% or below, with one carrier below 50%.”
China Ports are just as congested for many of the same reasons. Even if you get space on a vessel, some vessels are leaving less than full due to equipment shortages, causing backlog of shipments, that could take several weeks to resolve.
According to Dynamar, a Dutch consultancy firm, “Transpacific routes are counter intuitive. To the USEC, capacity has risen by 16% (August 20/September 19) and by 8% to the USWC. With demand struggling, an increase in supply should lead to pressure on rates, which, as we can see, has not happened. From May onwards Pacific rates have been increasing and up to week 43 they have been at 105% higher, on average. On the Asia to Europe trades, “From the Far East to Europe, the average weekly rates for the first 43 weeks of this year are around 23% higher than for the same period of 2019.”, said Dynamar.
Never before has there been a situation of “No space, no equipment, no service.” November thru December is not likely to get any better and with CNY just around the corner, never has there been a better time to plan ahead.
Full article can be found at: https://container-news.com/port-congestion-caused-by-chronic-box-shortages-in-asia-europe-and-us/
To review how these issues will affect your supply chain and discuss how South East World Wide, Ltd. can help navigate these difficult waters, please contact your South East World Wide, Ltd. Sales Representative.