After a new COVID-19 outbreak, China announced sweeping new lockdowns. It goes without saying that lockdowns will impact manufacturing and other sectors even if the ports continue to operate normally.
n Sunday, China announced that the lockdowns will affect 19 provinces reaching major industrial and port areas including Shenzhen and sections of Shanghai.
All nonessential workers will stay home for at least one week and during that time the adult population will go under COVID testing tested three times.
Although the ports are continuing to operate, China’s latest measure against COVID are affecting the supply of exports and are expected to put pressure on the global supply chain in the next weeks.
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At the beginning, SEKO Logistics announced that the ports were closing and that the ships would be diverting from the Shenzhen region. However, today said that the ports and specific Yantian were operating normally.
Terminals in the main ports remain business as usual including vessel operation, yard handling, and gate-in & out. We are closely monitoring the situation and aim to bring you the most up-to-date information so that we can continue to serve our customers’ supply chain needs given the context of the situation
…Maersk announced after issuing a customer bulletin.
It is not sure yet if China’s worker will be counted as essential workers for the current lockdowns, but in the previous years, they were continuing to work under close supervision and with limited access to the broader community.
At the same time, Beijing announced that the controls will be tightened and all truck divers that are about to enter the ports will be required to show a negative COVID test and be tested again at the entry.
The lockdown in China is expected to bring further turmoil into the already broken supply chain
warns Container xChange in a bulletin about the current situation adding also that “The lockdowns in Shenzhen, Zhejiang, Shanghai, Jilin, Suzhou, Guangzhou and Beijing (19 provinces as of Sunday, probably more to come in a few days) imposed now will clearly heavily restrict container movement at these ports which will, as we’ve seen in the past, prove to be further damaging for the global supply chain.”
It is worth noting that Shenzhen is one of the primary manufacturing zones for electronics. 90% of China’s electronics manufacturing comes from the region and passes through the port at Shenzhen and, thus, there are big concerns.
Following the recent events after the Russian invasion of Ukraine, as well as the COVID-19 pandemic, the Shenzhen and the Yantian International Container terminal at the port are affected. However, Container xChange indicates that “there seems to be a negligible impact on the container prices and leasing rates in China” warning also that “the supply chain must prepare for another turmoil in the coming months”
Lockdowns in China will further reduce capacity and cause a surge in already inflated shipping prices. The shockwaves will be felt across the U.S. and America, and almost everywhere in the world
said Dr. Johannes Schlingmeier, co-founder and CEO, Container xChange.