China’s Coronavirus Disrupts Global Container Shipping Trade

LONDON/LOS ANGELES—China’s fast-spreading coronavirus is throwing the global container shipping trade out of sync, with lines re-routing cargos and reducing calls to Chinese ports, setting the scene for months of delivery delays ahead, industry sources said.

The spread of the deadly virus has shut down cities and factories in China and disrupted global air travel.

China’s decision to extend its Lunar New Year holiday period until Feb. 10 has compounded logistical complications, despite its ports staying open. China is a vital link to the container sector, transporting everything from fresh food to phones and designer clothes as well as industrial parts.

The world’s top container lines Maersk, MSC, and CMA CGM have all reduced calls to China, known as blank sailings, the companies said in recent days.

Exports of goods from China have already been hit, with broader repercussions. Hyundai Motor has said it will suspend production in South Korea, its biggest manufacturing base, because of a lack of spare parts.

Disruptions to sea cargo flows have compounded an already pressured situation for shipping lines as they struggle with weaker markets and higher costs from new International Maritime Organization (IMO) regulations on low sulfur fuel.

Shipping and trade sources say regular schedules are also being affected by truck and port workers in China stuck at home or away from their places of work. In addition, warehouses around dock areas in China are not fully working. This has led to ships being diverted from China to ports in South Korea.

South Korea’s Busan port, one of the world’s major container terminals, has already seen a spillover with container capacity at 78 percent and could rise further from its usual level of 70 percent, a Busan port official said.

“Shippers are parking cargo at our ports, so later, perhaps when the coronavirus dies down and the level of cargo (backlogged in China ports) decreases, they can deploy a small ship to carry these cargo to their destination in Chinese ports,” the official said.

If container levels increased to over 80 percent it would be difficult to run the port efficiently, the official said.

More Delays Ahead

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