The situation in China Worsens, delays may spoil frozen cargo, shipping carriers refuse US exports

Monday Morning Wake Up Call

February 1, 2021

The Situation in China Worsens

Due to the expanding spread of COVID virus in China the Government there is taking steps to protect their citizens and these steps may have considerable impact on industries too. Some important situations to be aware of include:

• With the Chinese New Year holidays soon to begin the Government announced new requirements that must be met in order to travel domestically in China. These requirements may impact travel meaning that workers are delayed in returning to work after the holiday ends. This may mean a slow restart in many factories and longer than usual supply chain delays.

• There is a shortage of drivers in many Chinese ports and this is causing delays in getting loaded containers to ports in order to meet vessel schedules. This problem will likely continue into the coming weeks due to the holiday period and the new COVID restrictions.

• Several cities and areas are seeing new lockdowns ordered and this will likely impact the supply chain as well.

• There is limited space for containers already and adding in these new challenges means that longer than normal supply transit times are likely well past the holiday’s end.

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China’s frozen food import delays over coronavirus fears add fresh pressures to global supply chains

• Hundreds of containers are being held up in Dalian, a major port for seafood imports, as authorities test the fish for the coronavirus before allowing them to clear customs

• Frozen containers are being diverted to other ports in China, leading to bottlenecks in Shanghai and Qingdao

(SCMP) A huge pile up of fish cargoes at a Chinese port risks impacting shipments of frozen food across the country and beyond.

Hundreds of containers are being held up in Dalian, a major port for seafood imports, as local authorities test the fish for the coronavirus before allowing them to clear customs, according to several freight forwarders, consultants and shipping companies.

That is leading to scant availability of electric outlets to keep refrigerated containers, known as reefers, cold.

The shortage of plug points and dwindling space at the port have prompted shipping liners to cancel new reefer bookings into Dalian, and the congestion is now spreading to other refrigerated items like fruit and dumplings.

“Much of the recent concern for rollover cargo has focused on reefer containers,” said Josh Brazil, chief operations officer of freight-data provider Ocean Insights. “If there are no power outlets at the port for reefers to be plugged in, cargoes of perishable food could be damaged or entirely lost if they cannot be re-routed to another port.”

The scenes playing out in Dalian echo the start of the disruptions the world saw when the coronavirus snared global trade flows early last year. Back then, lockdowns in countries including China meant ports were closed and ships could not unload cargoes, causing a dearth of vessels across the world with the ripple effect lasting for months.

To Read More: www.scmp.com/economy/china-economy/article/3119434/chinas-frozen-food-import-delays-over-coronavirus-fears-add

Shipping carriers rejected tons of U.S. agricultural exports, opting to send empty containers to China

• Shipping carriers rejected U.S. agricultural export containers worth hundreds of millions of dollars during October and November, instead sending empty containers back to China to be filled with more profitable Chinese exports.

• The refusals come during the peak season for agriculture exports.

• While U.S. agricultural exports run continuously for 12 months, the months of November through March are critical.

• The Federal Maritime Commission launched an investigation into the matter and is reviewing the trade data to see whether the carriers refusing U.S. export cargo was a violation of the Shipping Act.

Shipping carriers rejected U.S. agricultural export containers worth hundreds of millions of dollars during October and November, instead sending empty containers to China to be filled with more profitable Chinese exports, a CNBC investigation found.

The Federal Maritime Commission has received petitions from U.S. agricultural exporters warning that the delays in trade not only threaten profits but the reputation of the industry.

The commission, in turn, launched an investigation and is reviewing the trade data out of key ports in California, New York and New Jersey to see whether the carriers’ refusal to load U.S. export cargo was a violation of the Shipping Act.

The act makes it unlawful for carriers to “unreasonably refuse to deal or negotiate,” “boycott or take any other concerted action resulting in an unreasonable refusal to deal,” or “engage in conduct that unreasonably restricts the use of intermodal services.”

To Read More: www.cnbc.com/2021/01/26/shipping-carriers-rejected-us-agricultural-exports-sent-empty-containers-to-china.html

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