The impression of a total return to previous phases of the pandemic and its side effects is given by news coming in from the major ports of Shanghai and Shenzhen. The new wave of the coronavirus creates major staff shortages, causes renewed congestion in the transport of goods, and leads to massive cancellations of orders.
Paradoxically, the impact of the new outbreak, a side effect of the sudden lifting of all restrictive measures in China, resembles that of the widespread lockdowns that caused the global supply chain to experience a heart attack. More and more cargo bookings are being cancelled at its two most important commercial ports. And as officials in Shanghai, the world’s largest commercial port, and Shenzhen point out, the reason is that “industries cannot operate properly because a large proportion of their staff is suffering from coronavirus.”
Thus, logistics company managers are warning their customers that their orders may be delayed or not fulfilled, even though they are significantly lower than in earlier times, mainly due to a downturn in global demand. It is telling that even US industrial orders for supplies from China are down by 40% as demand is struggling in the face of the potential recession.
Hong Kong-based freight forwarder HLS points out, in a statement to its customers, that “with 50% or even 75% of their staff sick with coronavirus and unable to work, many Chinese industries cannot operate normally, so they have reduced production.” The company even warns of limited orders and shipments during the Chinese New Year period since many industries are reducing production and will be forced to cancel or delay shipments booked for the second half of January and early February.”
As regards the port of Shanghai, the world’s first container port, a report by the authorities states that “the number of cancellations of shipments is increasing as many industries are unable to operate normally due to the absence of their employees suffering from coronavirus”. The authorities have issued a similar warning for the port in Shenzhen, the world’s fourth-largest container port. But not only that. The problem has also extended to Ningbo and Quingbao, two smaller ports compared to Shanghai and Shenzhen, which are being used as fire escape to achieve some relief, especially in Shanghai.
