China’s strict “zero COVID” policy is heaping pressure on the country’s ports, further disrupting global logistics and weighing on already battered supply chains.
Among other measures, China has been requiring crew members of cargo ships to be tested before docking, and if even one suspected case is found, everyone on board must quarantine for at least 14 days, according to shipping companies and others familiar with the measures.
In those cases, ships must quarantine in anchorage areas off the coast, the companies said, which has caused further congestion and delayed their arrival at other ports. In late November, following the emergence of the omicron variant, China also increased mandatory quarantine for crew members returning from duty to seven weeks from the previous six, making crew shortages and staff scheduling even more of a problem.
Beijing’s State Council on Dec. 15 said it will further strengthen measures on crew exchanges programs, including asking that all crew members be tested at a foreign port before arriving in China beginning Feb. 15 next year.
This added pressure comes as ports in Europe and the U.S. are already severely congested due to labor shortages and a high volume of goods being shipped to meet post-pandemic demand. The White House on Wednesday said the congestion has eased in recent days. Nevertheless, many logistics companies say the congestion cannot be resolved overnight, as many workers are taking time off during the holiday season, slowing down operations.
The schedule reliability of global liners — a measure of whether ships arrive or depart as scheduled — is projected to remain under 40% for the rest of this year, according to Sea-Intelligence’s latest available forecast. Four carriers had schedule reliability rates of under 20% in October, with Taiwan’s Evergreen the lowest at just 13.4%, the latest available data showed.
Shipping rates, meanwhile, have surged. The Freightos Baltic Index, which tracks container freight fares on the top 12 global routes, has surged more than 550% since the start of 2020 despite falling a bit in November and December. This includes fare for the busiest route, between China and the U.S. West coast.