Synthetic Resources Inc
Global Container Shortage
As many of you may know, when the People’s Republic of China (PRC) stepped up their COVID-19 precautions on incoming vessels, shipping container shortages worsened. Delays on the return of vessels, and unloading holdups in the PRC when the outbreak was mostly limited to Asia left shippers waiting for hundreds of thousands of containers to move their products. According to a Bloomberg report from earlier this year, the availability of cargo containers at Long Beach and Los Angeles were among the lowest levels recorded for the year at the time.
Now, amid a wave of demand for delivery by sea, helping drive up rates and supply chain costs for all international trade businesses, freight carriers are facing severe shortage of shipping containers and equipment this quarter and most likely next quarter. Other factors contributing to the shortage and a historic high on current ocean freight rates include business needs to replenish European and North American inventories, a rush to transport cargo ahead of Asia’s holiday schedule, and the continuation of tightened capacity due to the effects of COVID 19. Many businesses are witnessing their cargos getting rejected or rolled on a weekly basis. Carriers are projecting no relief in sight until after Chinese New Year possibly.
We are currently recommending adding 2-3 weeks to previously proposed transit times, so please plan your orders accordingly. Let us get through this together.
We will continue to work through these untimely disruptions, and keeping you updated on these logistics and cost challenges