A COVID-19 outbreak at a major Chinese port is worsening the global shipping crisis, which could disrupt orders for the holiday season, experts say

A COVID-19 outbreak at a major Chinese port is worsening the global shipping crisis, which could disrupt orders for the holiday season, experts say
Container ships sail in Suez Canal, during the 150th anniversary of the Suez Canal.Gehad Hamdy/picture alliance via Getty Images
  • Global shipping disruptions could trigger delays in goods for the holiday season, experts say.
  • A COVID-19 outbreak at a Chinese port has led to a shipment backlog, worsening a shipping crisis.
  • "Heaven knows what's going to happen come August or September," an expert told the BBC.

Shipping disruptions around the world could lead to a shortage of goods for the holiday season, according to industry experts.

A recent coronavirus outbreak in the province of Guangdong, in southern China, prompted authorities to introduce strict COVID-19 measures, causing congestion at four major ports, Reuters reported on Friday.

This is worsening a worldwide shipping crisis that has hiked costs and led to shortages of semiconductors, chicken, and other goods, as Insider's Rachel Premack reported.
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"Supply chains are more complex and delicate than ever," Tom Fairbairn, an engineer at the middleware company Solace, told Insider. He recommended customers use real-time data - for example, from Unilever's database - to see whether there would be disruptions.

"Retailers using this approach can say with confidence whether their Christmas inventory will be delayed or not," he said. Otherwise, he said, retailers could be "wasting existing stock, incurring unnecessary late fees, missing opportunities, and delaying deliveries."

The new restrictions at the Chinese port, which include disinfection checks and limits on vessel numbers, have triggered a backlog in shipments in ports in Yantian, Shekou, Chiwan, and Nansha, Reuters reported.
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Yantian, "one of the biggest ports in China, has basically closed down for close to three weeks," Nils Haupt, the communications director at the German shipping firm Hapag-Lloyd, told the BBC on Sunday. "They have some berths in operation, but nowhere near enough."

Delays are "piling up" in the other three ports as well, Haupt said. James Baker, the container-shipping editor at the industry publication Lloyd's List, told the BBC that retailers were already putting in orders for the holiday season because they know how slow shipping is at the moment. He said this was leading to more congestion.
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"Traditionally, the peak season for container shipping starts in the third quarter as everyone stocks up for the holiday season in the west, but this year we're just in a permanent peak season already, and heaven knows what's going to happen come August or September," he said. "It could get crazy."

Baker told the BBC he expected shipping delays to last at least another year. Until then, customers in North America and Europe will continue to wait longer than usual for orders, he said.

More than 50 container ships were waiting to dock in the Outer Pearl River Delta as of Friday, compared with about 20 ships in the same period last year, according to Refinitiv data cited by Reuters. This was also more than in February 2020, when the coronavirus pandemic stopped China's shipping business, the report said.
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The industry is still suffering from the 400-ship backlog caused by the Ever Given container ship getting lodged in the Suez Canal in March. The ship was freed at the start of April, but Maersk, the world's largest shipping company, has said it could take months to resolve delays.

"We were just beginning to see light at the end of the tunnel" after the Suez Canal blockage, Haupt told the BBC. "But then unfortunately we ran into this situation in Yantian."

The COVID-19 crisis has sparked several issues for the shipping business - customers' spending habits fluctuated during the pandemic as people stayed at home, shifting the demand for shipments and destabilizing the industry.
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