March 16, 2020

 

Port congestion in China decreases but rates for refrigerated containers rise

 

A deadlock of refrigerated containers at China's ports have prevented shipments of fresh and frozen food and increased freight rates outside of the country, reported Reuters.

 

Movement restrictions imposed due to COVID-19 had caused congested ports in China, resulting in transport cargoes with refrigerated containers to be redirected elsewhere.

 

However, China has introduced financial support and lifted restrictions to help companies begin operations. Ports have commissioned transport to bring truck drivers back to work to ease port congestion.

 

Zhang Ruxing, China Ports and Harbours Association container division secretary general said ports are steadily recovering as staff have begun to return.

 

German-based Hapad-Lloyd, a shipping company said China's ports are returning to normal, with more spots to plug in refrigerated containers becoming available.

 

The post association said as of March 6, 2020, 18,000 twenty-foot-equivalent unit (TEU) refrigeted containers remained at Shanghai and Tianjin, lower than the 27,000 TEU reported in February 2020.

 

Ports in Shanghai and Tianjin have added 7,000 spots to plug in refrigerated containers, increasing is capacity by 40%.

 

Frank Madsen, Danish-based Blue Water Shipping global director of reefer and marine logistics said freight rates are increasing by as much as 200% and expected to go higher, especially as many shipping containers are stuck in Asia with ship lines stopping sailings.

 

Madsen said the space and equipment problems at ports will not ease for another four to eight weeks.

 

Frozen pork shipments continue to head to China even with increasing freight rates, as demand for the meat in the country is at an all time high due to the African swine fever outbreak decimating more than 40% of China's domestic herd.

 

Half of Blue water's refrigerated containers are attributed to pork.

 

A Beijing-based meat importer said around 10,000 refrigerated containers with meat were stuck at ports in China, double the usual. He added that many of these containers have already been unloaded.

 

-      Reuters