China Update – COVID shutdown disruption

SHANGHAI: 

  • Covid measures announced prior to lockdown remain in effect until further notice.
  • Many offices, workplaces, and public transport are closed in locked-down areas, this is preventing staff from operating factories and warehouses.
  • Stellars agent presently operates remotely to service clients and partners.
  • Whilst airport terminals and container terminals remain operating the main problem being experienced are the restrictions limiting the transport to / from the ports

transport:

  • Transport services to-and-from the airport and container port are significantly limited due to the measures.
  • The restrictions include the closure of many highways normally used by truckers.
  • The road transport costs and the waiting time costs have soared during this time.
  • Nearby industrial areas, Kunshan, and Suzhou have similar lockdown environments with limited truck service to and from these areas and Shanghai.
  • We now notice several factories changing shipping terms from FOB into Ex-Works and handing over the responsibility to arrange local transport to the overseas buyer.
  • Many nearby cities now reject Shanghai drivers entering.

Airfreight:

  • Air terminals operate, It is OK with loading aircraft at the airport as major airlines continue to operate – the problem is transport restrictions limiting the transport to/from the airport.
  • Much cargo diverting to other airports in the region.
  • Rates for air transport has come down following many factories closed by the lockdown and the limited road transport abilities. However, the road transport costs and the waiting time costs have soared during this time.
  • We expect the issues to remain into at least mid-May before situation back to a more normal capacity again, our Export team can assist with potential re-route of cargo where is possible.
  • For cargo outside of Shanghai, it can be transported to other airports.

Ocean freight:

  • The world’s biggest container port, Shanghai port terminals, in Waigaoqiao and Yangshan, operate as normal but the local transportation and terminal handling capacity are limited due to the traffic measures and availability of truckers.
  • The situation has impacted the vessels’ service with blanked sailings, delays, and longer waiting times.
  • For FCL export our team handles FCL via SHA port where the shipper location is favourable for transport to the port, if not favourable location our team will assist with potential re-route of cargo where possible.
  • For cargo from Zhejiang is recommended to use the Ningbo port.
  • LCL handling is still strictly limited due to the limitations of CFS terminals, hence recommending clients to use the Ningbo port for LCL.
  • The majority of LCL handling warehouses are closed.

HONG KONG:

  • Cross-border trucks between China and Hong Kong are still having capacity limitations due to COVID measures.
  • Long waiting times for control and restrictions for travel determine the capacity.
  • Many of the goods for Cross-border are still transported by ocean service due to limited truck capacity.
  • Warehouses in the city have reduced capacity for cargo handling causing delays for handling and loading with staff restrictions.

SHENZHEN:

  • Shenzhen region warehouses operate.
  • All truck drivers require a cleared 24hours PCR test report

Air:

  • Airlines operating OK.

Ocean:

  • Ports are operating, but trucking still has limitations and will likely continue to reduce the port volumes temporarily. Waiting times for vessels have increased at all terminals in the area and some carriers have skipped some calls.

General:

  • Many offices work remotely which affects operations at terminals, offices, and factories in the area.
  • Local areas around Shenzhen may have various local measures with factories and community closures based on the local conditions.

XIAMEN:

  • Local trucking, ocean shipping, warehouse, and terminals in Xiamen operate as per normal
  • Stellar China agent operates on-site.
  • The situation for local transport is very limited in capacity at present

NINGBO:

  • The situation in China’s second-biggest port, Ningbo has deteriorated as more cases and more measures are introduced in combination with a lot of shippers trying to re-route cargo from Shanghai through Ningbo ports, this is mainly for shippers in areas such as Jiangsu province, Anhui province, Sichuan province, and Shanghai.
  • Since the lockdown started in Shanghai, many shippers re-routed shipments via Ningbo increasing pressure on the trucking service and the shipping service.
  • Drivers need to provide valid Covid tests and make daily testing which reduces available trucking capacity.
  • The restriction measures also closed many high-speed roads, which normally are used by truckers, reducing capabilities for transport out of Ningbo city, while factories can arrange transport to Ningbo.
  • For LCL cargo the pressure for the Ningbo terminals is very high.
  • The majority of warehouses are now working 24-hours with long queues for cargo unload and delivery to the warehouses.
  • Trucks are lining up for delivery and waiting for around 3 days in order to get into warehouses.
  • Stellar China agent operates on-site.
  • Nearby areas such as Hangzhou, Wenzhou, and Jiaxing have local measures with factories and community closures based on the local conditions.
  • The situation for local transport is very critical and limited in capacity at present   

QINGDAO:

  • Qingdao city is open for transportation and warehouse activities.
  • Trucking within Qingdao city is normal.
  • Trucking across the cities and Shandong province has improved from last week.
  • Laixi areas are still difficult, with measures restricting operations.
  • Air and ocean shipping operate as normal and warehouses operate normally.
  • Stellar China partner operates on-site.

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