Reefer cargo diverted from China ports as virus restricts movement
CHINA's ports and terminals have too few electricity supplying reefers plugs to accommodate the incoming flow of reefer containers because of crippling coronavirus restrictions imposed by the government, told New York's FreightWaves
CHINA's ports and terminals have too few electricity supplying reefers plugs to accommodate the incoming flow of reefer containers because of crippling coronavirus restrictions imposed by the government, told New York's FreightWaves.
'The challenge for our exporters of refrigerated pork, beef and poultry, as well as dry cargo such as hay and lumber, is lack of capacity of the supply chain,' said Agriculture Transport Coalition chief Peter Friedmann.
'The reefer plugs are all taken at Chinese terminals, and domestic China restrictions on movement of persons and vehicles are severely limiting the ability to move reefer and dry containers off the terminals to inland,' he said,
Container lines are instituting special reefer surcharges for cargo to affected Chinese ports and are warning customers of diversions ahead. Ocean Network Express (ONE) and Maersk are adding US$1,000 per container, with CMA CGM and APL charging $1,250 and others expected to follow suit.
'Most reefer plugs at the yards of all container terminals in Shanghai, Ningbo and Tianjin/Xingang are already occupied,' warned CMA CGM, noting that it is being 'forced to divert reefer cargo to other ports.'
According to ONE, 'Due to the slow inbound container pick-up activity caused by the outbreak of the coronavirus and the extension of the Chinese New Year holiday, terminals face a serious shortage of available reefer plugs.'
Maersk is allowing customers to change destinations for free and stated that it can offer no guarantee on when reefer cargoes scheduled to be unloaded in Shanghai and Xingang will ultimately arrive, because the situation 'is outside of our control' and depends on when 'the ports are able to receive reefers again.'
Mr Friedmann pointed out that it's not just a shortage of reefer plugs. 'The slowing or curtailment of China production of US-bound consumer goods and manufacturing components has logically led ocean carriers to cancel sailings, for lack of cargo. As the increasing number of ships are not arriving at US ports, there is a growing shortage of ship space and containers to haul our ag exports to China.'
Forty per cent of China's pigs have been slaughter as a result of the African swine flu. This has been highly negative for demand for bulk carriers, which transport soybeans to China for use as pig feed, but highly positive for demand for refrigerated meat exports to China, particularly in light of the recent easing in trade tensions between the US and China.