Four weeks after a COVID-19 outbreak in southern China disrupted operations at the busy Yantian port, officials announce the first ray of hope that operations are beginning to function normally. Analysts and big shipping lines, on the other hand, are all warning of long-term disruption, delays, and shortages as a result of the large backlog at the port and the ripple effect on other Chinese ports.
Maersk noted yesterday in a new update to clients, “After a six-day halt on export containers, the Yantian port authorities have announced that productivity will gradually grow as more personnel return and more berths reopen.”
Although the density in the Yantian container yard remains about three-quarters of average, import-laden containers resumed operation in the western section last week. According to Yantian International Container Terminals officials, the gate-in truck capacity has been expanded from 6,000 to 8,000 trucks per day. They expect that the port will attain full operational capacity by the end of June.
While this may be considered positive progress, the impact on the system and backlogs is enormous. Efforts to recover are compounded by the fact that commodities continue to flow out of factories across China but are being stranded due to the port's inability to transfer containers.
Yantian, with 20 huge, deep-water docks, serves over 100 shipping routes. Port officials said last fall that monthly container throughput hit 1.46 million TEUs in September, shattering the global monthly record for a single terminal operated by a single port operator. The port's limited capacity is reverberating throughout the supply chain.
Other major carriers, as well as analytical services, have corroborated the congestion that Maersk has warned customers about. Project44, a shipper platform that provides visibility into essential shipping operations, examined ship movements and discovered a 300 percent rise in blank sailings at Yantian. According to reports, 298 container ships with a total capacity of more than three million TEUs skipped the port in the first half of June. Blank sailings are expected to remain high for at least another week.
The dwell time analysis performed by project44 produced a worse estimate than Maersk's customer advisory. The 7-day average of median dwell periods on export containers from the Yantian terminal has more than quadrupled in the last two weeks, hitting 23.06 days on June 15, according to project44.
“While YICT is at the epicentre of this particular breakdown, these numbers portend concern throughout the maritime shipping world, particularly for enterprises that rely on these routes,” said Josh Brazil, Vice President of Marketing at project44. “Even cargoes not directly affected by the Yantian crisis may feel the impact as carriers adapt their networks to avoid YICT congestion.”
According to some observers, it might take up to a month for the systems to recover and work through the backlogs. This, however, is totally dependent on China's ability to contain or eradicate the virus in the southern port region.