With reports of growing congestion and a shortage of containers spreading to major Chinese ports, Chinese authorities are calling for close cooperation to maintain trade and slow the rise in container tariffs. They recently called on ports and shipping associations to work with international carriers to resolve the container shortage.
Speaking at a meeting hosted by the Ministry of Transport, Chinese officials said the China Ports and Ports Association (CPHA) and the Chinese Shipowners Association (CSA) must work together to reduce the shortage of containers, which is essential for foreign trade. The ministry acknowledged that the rebound in trade that began in mid-2020 was contributing to the container shortage. However, they also cited the slow return of containers from North America to Asia as a contributing factor to the current shortage in China as well as on other trade routes.
Shortages have become more acute at major Chinese ports as manufacturers and ports scramble to transport goods ahead of the Lunar New Year celebration, according to reports in the Journal of Commerce. Ports such as Shanghai, which is the world’s busiest container port, report a growing backlog. Last October, Shanghai set a new record of 4.2 million TEUs displaced in one month, and for the whole of 2020, the port handled 43.5 million TEUs, a slight increase from compared to 2019.
Citing the backlogs and shortages occurring in China, Container News reports that Chinese officials have said improvements in container capacity and supply, as well as cooperation with overseas ports and agencies are necessary. They quoted officials who said: “Various line operators have optimized the allocation of vessels to their service routes, and we will continue to facilitate outbound trade by ensuring that transportation runs smoothly. However, due to congestion in overseas ports, poor collection and distribution systems, and difficulties in returning empty containers, the disparity between shipping capacity and container supply is always obvious.
Inefficiencies were cited as a factor contributing to the increase in container shipping rates in 2020. Officials said more cooperation is needed to address these challenges.
According to the Journal of Commerce, major Chinese exports all plan to remain open during the Golden Week holidays, and despite some workers leaving to return home for the holidays, the ports hope to use this time to reduce the backlog. . However, many Chinese manufacturers also plan to work during the holidays this year, which means that the flow of export goods to ports will continue as well.
In 2020, China said it was taking action to increase the supply of containers. They said China was working with related parties to bring more containers to the market, speed up container turnaround and help container manufacturers increase productivity. State media noted that the China Container Industry Association is urging shipping container manufacturers to increase production of standard boxes. They reported that China has been producing 300,000 TEUs per month since September to help alleviate the shortage and that Chinese container manufacturers have extended their normal working hours to 11 hours per day.