This year has been marked by continued disruption as Covid-19 remains a disrupting factor around the world – causing congestion at some ports and closing others entirely. With December 2021 and the end of the year upon us, many shippers are navigating a crucial period – the preparations for Chinese New Year. In the Asia-Pacific (APAC), these preparations are particularly important. In this update we take a look at the latest logistics situation:
Strong ocean freight demand will continue into the first quarter of 2022
Looking forward to 2022, you should stay prepared, as we expect the market conditions to continue at least into Q1 – with high demand around Chinese New Year. The major public holiday in APAC falls on 1st February 2022 but we expect to see issues with capacity in the weeks following – as manufacturing and businesses take some weeks to reach full production after the celebrations.
Capacity issues will also be caused by schedule delays created by port congestion. One of the major disruptors in logistics this year, Maersk estimates around 12%-15% of global container ship capacity has effectively been taken out of circulation by congestion this year. This means space will also be tight in the run-up to Chinese New Year.
The container shipping situation is improving
Looking at the container situation, while we will still see shortages in some locations in the lead up to Chinese New Year, overall the situation has improved since our last update. We are continuing to in-fleet containers and are progressing with getting more empty equipment back to Asia – and we are hopeful that the situation will continue to improve after the New Year.
In North America, the situation is more challenging as ports are becoming more congested. Read our latest transpacific shipping update for a full round-up of the situation in North America and its key markets.
“Port congestion is the main theme of disruption around the world this month, as it has been for most of the year – with the ripple effects of lockdowns and Covid outbreaks coming up against strong consumer demand. At Twill we’re doing everything to make customers aware of disruptions and facilitate alternative options – but for businesses, communication is key. Keep in touch with your suppliers, manufacturers and shippers to ensure everyone is aware of the roles and responsibilities agreed in your contract and to make sure any delays or disruptions can be navigated quickly."
Review your transport options as Covid-19 disrupts barge services
There is some important news for us to leave with you this month around barge services into South China in the build-up to Chinese New Year. A new Covid-19 wave in the country has resulted in a shortage of port crew which will have knock-on impacts for the coming holiday season. An official notice from Hong Kong barge service providers states that there will be no barge coverage into South China barge ports from December 25th, 2021 until February 10th, 2022.
With this in mind, you should expect longer layovers or delays due to limited alternative solutions for exports and imports via Hong Kong. To minimise any impacts of this development to your business, we are looking at including offering alternative transhipment services via Chiwan/Shekou or Nansha. We are also looking at both inland and other ocean solutions to try and alleviate the disruption caused by these port suspensions.
That’s the latest from us! For more insights and updates like this, take a look at our Knowledge Hub.