Welcome to the Container xChange monthly container logistics update.
Here you get the latest industry updates together with special insights into the cheapest and most expensive locations to buy and lease containers in right now.
This month: Chinese port congestion worsens container shortage
With the partial lockdown of the world’s third busiest port, Port of Ningbo-Zhoushan, vessels are now diverting from the port. This pressures nearby ports, which already saw challenges coping with the increasing number of incoming containers.
The port congestion at the ports of Shanghai and Hong Kong have reportedly increased in the past weeks. A tendency, we can also see in the development of the container availability in the ports.
The Container Availability Index (CAx), by Container xChange, shows the demand and supply of containers in different locations. When the value is over 0.5 the supply of containers surpasses the demand. Is the value under 0.5 the demand is higher than the container supply.
Below, you can see the container availability for the Port of Shanghai. Since week 33, the supply of containers has increased from 0.53 to 0.55 in week 34, further pressuring the port and terminal capacity.
The trend is estimated to continue upwards in the coming weeks. Leaving more containers to be stuck at port and the container shortage to persevere.
Why is this happening?
The worldwide container congestion and equipment shortage was kicked off when the COVID-19 pandemic closed down large parts of the world. Then followed a swift increase in demand, the industry had difficulties keeping up with.
Now, the Port of Ningbo-Zhoushan has undergone a partial lockdown due to COVID-19 outbreaks. A similar situation happened earlier this year, where the Port of Yantian went into lockdown. This created a ripple effect throughout the industry, and pushed the container congestion to new heights.
However, it doesn’t seem the partial lockdown of Ningbo-Zhoushan will create an equally vast backlog. And the phased reopening of the port, should also levy the impact of the slowed down services at port.
What does this mean for you?
Despite the slow reopening of Ningbo-Zhoushan the backlog of containers waiting at the terminals will take time to process. The same is the case with the nearby Chinese ports, which won’t get back on track overnight.
This has two major implications for you:
If you want cargo to China: Getting containers and goods through the terminals at the Chinese ports is a time consuming task that can end up costing you excess money and valuable time with boxes stuck at port.
If you export goods from China: The port congestion has made it difficult for forwarders to get their hands on containers in China to transport cargo for shippers. This means that it’s becoming increasingly difficult for forwarders to fulfill orders.
What can you do?
What happens in the world with a pandemic and container congestion is something many of us can’t do anything about. And with many containers being located in places where they’re not desired, it calls for thinking out of the box.
So, take a deep breath.
Being patient is one of the things you’ll do well coming to terms with. There are just some things that are out of our hands. However, that doesn’t mean you just have to sit around and twiddle your thumb.
In times where unexpected events are prone to happen, digital solutions can become your new best friend. It can be solutions such as container tracking, so you always know where your containers are and can make adjustments accordingly.
It can also be digital solutions such as the xChange platform that helps you find equipment even in a time of shortage. – Or should we say, in a time where boxes are located other places than where you usually find them.
Book in advance and pay up
If you want to make sure your box gets a slot on the vessel, you’ve got to be one step ahead. That means, booking the slot in advance. We know – that also means paying more. But in times like these, you have the choice between happy customers or dissatisfied phone calls.
Compare locations, suppliers, and prices
Instead of doing what you’ve always done, you could save a substantial amount of money by comparing different locations, suppliers, and prices.
You may find that a container supplier wants less money for a box in a location where inland transportation to your preferred location would still make the cost lower. Or that another supplier has cheaper containers available at your desired location compared to the company you usually deal with.
Want to get a sneak peek into where you can buy or sell containers at the highest and lowest prices right now? Check it out below 👇