Global shipping was just starting to recover from the chaos of the pandemic. Now port congestion and delays are back and could be around for a while.
Covid lockdowns in China have wreaked havoc at Shanghai, the world’s biggest container port, and are now causing problems at other major ports around the world.
Some Chinese cities, including Shanghai, have started easing Covid restrictions in recent days, but experts say that the damage has already been done, and global shipping will suffer well into the summer. That could exert even more pressure on global supply chains already reeling from Russia’s invasion of Ukraine, and keep inflation running hot.
Data from Project44, which tracks global supply chains, showed that shipment delays between China and major US and European ports have quadrupled since late March, when China shut down the city of Shanghai, which has the world’s busiest container port.
Since March, however, there’s been a sharp increase again in transit times on that route.
To add to the problem, many truck drivers have struggled to reach ports in China to pick up containers because of travel restrictions and Covid testing requirements. Shipping giant Maersk warned in an advisory last month that trucking services in Shanghai would be “severely” impacted by these restrictions.
“With the manufacturing industry being shuttered [in Shanghai] and truckers unable to travel quickly, exports have been reduced, and shipment delays have increased,” said Josh Brazil, director of Supply Chain Data Insights at Project44.
Delays will “continue into the summer months,” as factories struggle to return to normal operations in Shanghai, he added.