As China Regains Normalcy, Ocean, Air Freight Operations Facing Global Uncertainty

Although Chinese ocean operations and domestic trucking activities are returning to normal, there remains significant concerns over equipment and space availability for ocean fighters around the world, according to a March 17 emailed alert from Crane Worldwide Logistics. Air cargo transportation also remains uncertain, with availability of ports in China constantly changing and countries canceling flights to regions with high concentrations of coronavirus cases, the alert said.

As China urges companies to resume operating (see 2003130028), the country’s ocean operation has been revived, its manufacturing activities are “returning to normal” and its trucking operations are “gradually improving,” with most drivers back on duty. But space remains “tight” on ocean carriers, and exporters should expect spikes in Trans-Pacific Eastbound rates, which increased March 15, the alert said. “Equipment and space availability is a concern across the globe,” the alert said.

In addition, reduced terminal gate hours in the U.S. are impacting container returns on the West Coast, which is leading to detentions of goods. The Agriculture Transportation Coalition has urged carriers to extend free time -- exemptions from detention and demurrage penalties -- due to coronavirus impacts (see 2002030034). While some carriers are waiving those fees if return locations are unavailable, “others might still be charging,” the alert said. In addition, free-time requests are starting to become restricted globally, the alert said, but existing free times are being honored. Exporters should expect “additional fees” to continue to be applied by ocean carriers transporting in and out of China.

Due to increased production volume from China, no more Trans-Pacific blank sailings have been announced, according to a March 16 alert from C.H. Robinson. “Empty container supply continues to dwindle” across the globe, the alert said, including in India, North America and Europe. This will lead to backlogs as demand continues to rise, the alert said.

In addition, C.H. Robinson said India recently announced that it will screen all vessels and crews arriving from China, Thailand, Hong Kong, Singapore, Japan, South Korea, Vietnam, Indonesia, Malaysia, Iran, Nepal and Italy. Despite the additional screenings, “all major ports continue to function smoothly with no impact to operations,” the alert said.

Air carriers continue to face a “very fluid” situation at the Beijing Capital International Airport, the Shanghai Pudong International Airport and Hong Kong International Airport, Crane said, with changes occurring at a “moment’s notice. Space is limited and comes with “no guarantee,” the alert said. Freighters with Air France will continue on schedule, but the country has suspended flights to Italy through April and has suspended flights to Shanghai and Beijing as of March 15.

Some airlines have taken more drastic measures, such as Air India, the alert said, which has canceled all flights to Italy, France, South Korea, Spain and Sri Lanka until April 30. New Zealand has canceled flights between Auckland and several U.S. cities, including Chicago, San Francisco, Houston, Honolulu as well as Taipei, Buenos Aires and Vancouver.

Crane said capacity is available for global charter operations, including occasional charters carrying 20 tons and more. But “capacity and rates have been fluctuating a lot over the past few days,” the alert said.