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As if rising shipping costs, global product shortages and the recent Suez Canal crisis weren’t enough, a late-May outbreak of COVID-19 among dockworkers in parts of the Guangdong province in China has forced the Yantian Port — the fourth busiest in the world — to shut down. The halt in shipments has sent shockwaves through an already beleaguered industry and has further slowed port operations in neighboring regions as shipping companies scramble to keep product moving and meet customer demands.
Our analysis of ocean data in the 2 weeks following the news of the Yantian outbreak shows unprecedented congestion at the Yantian Port, and an all-time-high dwell time of 20 days. Among other findings:
The US market has opened back up to a strong economy and rising consumer demand for goods, but the late-May shutdown is causing repercussions for US businesses and consumers. Imports are down sizably — from electronics to furniture to automobiles — and late shipments are quickly rising, which can lead to increased demurrage and detention fees, customer satisfaction issues and a potential bullwhip effect on ports. We looked at FourKites platform data from the busiest ports in the country over the last two weeks and found that:
The situation in Asia remains uncertain, and while Yantian Port says it should be back to normal by end of June, we anticipate that it may take months for the cargo backlog to clear, and for the global ripple effects to subside. To combat these lasting impacts, businesses must plan ahead, leverage technology that can help them remain agile, and make careful considerations on if and how to reroute the already backed up goods coming in from overseas.
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