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International container shipping expected to be more chaotic in the upcoming peak season
According to a Container xChange survey, forwarders, traders and shippers expect the container peak season in 2022 to be even more chaotic than 2021.
The Container xChange survey found that 51% predict the traditional peak season in the third quarter of this year will be worse than 2021, 26% predict it will be less chaotic, and 22% predict a similar level of chaos in the last year.
The pandemic has disrupted the usual seasonal swings in the container market as factories close, lockdowns spread, and congestion ensues. Facing another year of disruption, respondents turned to multiple strategies to get items to retailers in time for the fourth-quarter shopping season.
Container line reliability drops to 35.8% in 2021 and falls even further in Q1 2022.
About 37.5% of respondents said they will be shipping early in 2022 to ensure volume, 25% are using alternative shipping routes, and 18.8% are signing long-term contracts with carriers. load.
Despite the difficulties in 2021 and the forecast of chaos, 62.5% of respondents still rely on the spot market or do not have a specific plan to ensure shipments reach their destinations in time.
Returning to the current situation, 58% of respondents said that China's Covid-19 lockdowns had made it "hard to produce/ship as much product as planned". That added to concerns that a lifting of lockdowns in China could lead to a spike in exports, further disrupting supply chains to Europe and North America.
"Predicting exactly what will happen in this year’s peak season is harder than normal because there are so many contradictory signs and intangibles," said Christian Roeloffs, Co-Founder and CEO of Container xChange.
"One big question is whether China is going to sacrifice its zero Covid-19 policy to get trade and its economy moving again."
“If it does, then there’s every sign that we’ll see a substantial surge as backlogs of exports is shipped. If lockdown rules are relaxed soon and truckers are allowed to get back to work, then those backlogs will be arriving at the same time as peak season orders which could cause a lot of supply chain blockages at ports in Europe and the US where congestion is already widespread."
“However, there are very few indicators so far that President Xi is willing to compromise health policy to boost trade. Indeed, it might not be politically expedient for him to do so with the Communist Party National Congress set for later this year when he is expected to be endorsed for a third term."
See more:
- Demand for shipping refrigerated goods to Shanghai recovers as lockdown set to end on May 20
- Blank sailings on Asia-North Europe service increase - Sea-Intelligence Report
Source: Phaata.com (According to SeatradeMaritime)
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