With reports of growing congestion and container shortages spreading to China’s major ports, Chinese officials find themselves calling for extensive cooperation to maintain trade and curb rising container fees.
Recently, they called on ports and shipping associations to unify efforts with international carriers to solve the container shortage.
At a meeting organized by the Ministry of Transport, Chinese officials said the China Ports and Harbors Association (CPHA) and the China Shipowners Association (CSA) should work together to reduce the container shortage, which is critical to foreign trade.
The Ministry acknowledged that the trade rebound that began in the mid-2020s was contributing to the container shortage.
However, they also cited the slow return of these containers, from North America to Asia as a factor in exacerbating the current shortage in China, as well as in other trade lanes.
According to reports in the Journal of Commerce, shortages have become acute at major Chinese ports as manufacturers and ports work to move goods ahead of the Lunar New Year.
Ports such as Shanghai, which is the world’s busiest container port, are reporting increased delays. Last October, Shanghai set a new record of 4.2 million TEUs moved in a month, and for all of 2020 the port handled 43.5 million TEUs, which was a small increase from 2019.
Citing the delays and shortages being experienced in China, Container News reports that Chinese officials said there is a need to improve container capacity and supply, as well as cooperation with overseas ports and agencies.
Officials were quoted as saying, “Several liner operators have optimized the allocation of ships to their service routes, and we will continue to facilitate foreign trade by ensuring smooth transportation. However, due to congestion at overseas ports, poor collection and distribution systems, and difficulties in returning empty containers, the disparity between shipping capacity and container supply remains obvious.”
Inefficiencies were cited as a contributing factor to the increase in container shipping rates experienced in 2020. Officials said greater cooperation was needed to address these challenges.
According to the Journal of Commerce, China’s major exports plan to remain open during the Golden Week vacation, where ports hope to take advantage of the period to reduce backlogs.
However, many of China’s manufacturers also plan to work during this year’s vacations, meaning that the flow of export goods to the ports will also continue.
During 2020, China reported that it was taking steps to increase container supply. They said China was working with related parties to provide more containers to the market, speed up their delivery and help manufacturers in order to expand productivity.
State media noted that the China Container Industry Association was urging manufacturers to increase production of standard boxes.
They reported that China has produced 300,000 TEUs per month since September to help alleviate the shortage and that Chinese container manufacturers had extended their normal working hours to 11 hours a day. We see how a disruption in the balance regarding handling and marketing, which revolves around containers, alters the entire supply chain.