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China's Zero Covid Policy Causing Shipping Bottlenecks in Chinese Ports

Just as US ports are finally clearing backups, ports in China are headed the other direction.
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Backlogs Building in Shenzhen

The Wall Street Journal reports China’s Covid-19 Flare-Up Threatens Backlog at Busy Port of Shenzhen

Cargo ships are accumulating at one of China’s busiest ports after another Covid-19 outbreak shut down factories and warehouses in Shenzhen, raising the prospect of a new round of bottlenecks that could push up freight rates and slow deliveries.

There are more than 35 ships waiting to dock in Shenzhen and another 30 farther north in Qingdao, according to shipping brokers. The Port of Shenzhen, which serves a major manufacturing and export hub, includes the Yantian terminal, which handles about a quarter of all U.S.-bound Chinese exports. Shenzhen remains open, but most manufacturing plants and warehouses were ordered to close this past week, and container loading is falling fast as fewer trucks are arriving.

The freight forwarder Seko Worldwide said in a report this past week that there are restrictions for trucks traveling in and out of Shenzhen and that trucks from Shenzhen to Hong Kong have stopped operating, except for essential goods to Hong Kong.

It said truck restrictions also remain in Shanghai, the world’s largest port, with some ships rerouting to Ningbo.

United Parcel Service Inc. has issued service alerts. Pickup and delivery were suspended in Shenzhen and Dongguan, while in Zhejiang province and elsewhere imported items would be set aside for four to seven days for sanitization, the company’s website said.

The backlog at the Ports of LA and Long beach is down from a record 109 in January to a still high 48.

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