Shenzhen and Hong Kong port congestion reaches the highest level! Goods shipped to the United States will be delayed

It is learned that the strict lockdown measures caused by the recent surge in the COVID-19 epidemic have caused the worst congestion in the ports of two important cities in China, Hong Kong and Shenzhen, in five months. At the same time, as cargo ships bound for the United States cannot be loaded and shipped out of the port in time, the supply of goods to the United States this summer may be delayed and affected.

According to Bloomberg, there are currently about 174 ships anchored or loading in ports in southern China, including Hong Kong and Shenzhen, which is the largest number of stranded ships in southern China ports since Typhoon Kompa passed on October 21 last year. At the same time, the number of ships waiting to be loaded at Shanghai Port is also increasing rapidly.

CMA CGM said in a notice to customers that congestion and longer waiting times were seen at Shenzhen Port's Yantian and Shekou container terminals starting Tuesday, March 22. The resulting increase in the number of vessels on standby and the fact that road transport will take longer to resume.

The Freightos Baltic Index report also noted a decline in port productivity due to labor impacts, truck availability and a drop in available export volumes due to factory closures.

Ryan Closser, director of supply chain information provider FourKites, noted that Shenzhen is the second busiest port after Shanghai, so a large amount of cargo is expected to be diverted to other ports within China.

Impact on rates

The closure of the salt fields caused ocean freight rates to rise by 20% last year, but so far the additional delays and congestion that could push up rates have not been as severe.

Additionally, rates on the transpacific route fell slightly this week to $15,908/FEU, according to the Freightos Baltic Index, but remain within the $15,000/FEU range seen since the peak season closed in November.

Despite this slight softening, all signs point to export volumes and rates remaining high in the coming months.

Potential threats

In addition, to avoid delays during the peak season and to prepare for a possible strike by West Coast dock workers in July, U.S. importers have increased some import demands.

Indeed, U.S. importers have already begun recalibrating their supply chains to avoid disruptions ahead of what are expected to be difficult labor negotiations between UW-Med dockworkers and port operators this northern summer.

As a result, some shippers and importers are buying their holiday season inventory in advance. In addition, some logistics operators said that goods that usually move through the western U.S. corridor are being diverted to the eastern U.S. and Gulf ports.

That helped disperse congestion at the California ports of Los Angeles and Long Beach, underscoring the difficulties importers face in reconfiguring supply chains built around the world’s major U.S. ports, even though U.S. vessel volumes were 6% below average in the same month of 2021, according to shipping executives.

Editor ✎ Xiao Zhu/

Disclaimer: This article is copyrighted and may not be reproduced without permission.