by Eric Kulish at Freight Waves via ZeroHedge
Rerouting freight to avoid the extended lockdown in Shanghai, where daily confirmed COVID cases topped a record 17,000 this week, is becoming more difficult and expensive as cargo facilities in other Chinese cities become overcrowded, logistics companies and carriers warn.
The logistics challenges for ocean and airfreight in Shanghai are extreme.
More than 90% of truck capacity is out of service. Trucks are prevented from moving in and out of the city without a special permit, which is only valid for 24 hours and only on specific routes. “Even with this arranged, it is possible for booked trucks to be commandeered by the government to transport aid supplies,” Seko Logistics said in an update for clients.
Most warehouses in the city are closed. Pactl, the large airport cargo terminal operator, only has skeleton operations.
Limited truck access to Shanghai port terminals is causing shipping containers to pile up and slowing ship transfers. Seko said its team in Shanghai has seen an 80% decrease in container pickups from outside the lockdown area because of driver shortages and restrictions, with drivers requiring a special pass and negative COVID test results.
Mediterranean Shipping Co., the world’s largest container vessel operator, on Thursday said it will begin offloading refrigerated containers at other ports because there are no available power plugs to connect to in Shanghai. Unless customers request a specific change in destination within seven days, reefers will be discharged at intermediate or alternate ports of the carrier’s choosing. Additional freight charges for transshipment, storage, equipment rental and electrical connection may apply.
“If the situation does not improve soon it may be necessary to abandon the voyage and advise you from where your container may be collected,” MSC said in a customer notice.
Ocean Network Express also said overcrowding at two Shanghai container terminals might prevent its vessels from discharging reefer boxes.
Several ocean carriers have announced they will skip berthing at Shanghai due to traffic restrictions, which Seko said will intensify congestion at the terminals once restrictions are lifted.