China port congestion; five tips to keep your shipments moving
It’s unlikely you’ve managed to escape delays in your shipments departing from China over recent months; it’s expected to be an on-going risk resulting in:
Slower turnaround times and
Vessels kept waiting at sea
The main reasons for this are:
1. Volumes are up 6% in throughput year on year for the first quarter of 2017 across China’s top ten ports. Interestingly this increase is not just exports from China but also imports going to China. This is fuelled by the Chinese Government push towards a consumer-driven import economy.
2. Operational capacity is stretched at Shanghai, Qingdao and Ningbo which are the top three ports for growth in throughput in the first quarter of 2017. Shanghai port has seen a decline in the number of vessels calling however; the size of those that do have increased resulting in massive manpower and equipment peaks and troughs at the port, terminal and haulage availability.
3. Bigger vessels like the Madrid Maersk 20,568 TEU; the first of eleven vessels of this size. These bigger vessels add additional pressure at ports where resources are already overstretched.
4. Transitional problems with restructuring of shipping line carrier alliances in April which represents 77% of global container capacity. The main three carrier alliances now are:
Ocean Alliance = OOCL, CMA CGM, COSCO, APL and Evergreen
2M = Maersk, MSC, HMM and Hamburg Sud
The Alliance = MOL, NYK, K Line, Hapag-Lloyd, UASC and Yang Ming
5. Bad weather – Fog
6. Shippers moving their goods early to avoid May rate increases
Here’s five ways to help keep your shipments moving:
Avoid vessels departing the first 7-10 days of a month as rates (based on 2016) are the highest at this point.
Don’t move 20’ containers; consider loading as LCL with a freight forwarder (for a set price), as it’s more likely to depart quicker than a dedicated 20’.
Don’t delay shipments as the rates will increase every month as we move towards peak season.
Don’t choose the cheapest price! When vessels are full the shipping lines “load to revenue” which means higher paying customers containers get priority.
Plan ahead and book space with your freight forwarder 2-3 weeks ahead of loading.
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