Build up of reefer containers at Chinese ports cause freight rates to shoot up

According to a report published by Reuters, officials and industry participants said that congestion at Chinese ports is easing, although a large build up of reefer containers has stopped the flow of fresh and frozen food and increased freight outside China. Thousands of refrigerated containers transporting meat, seafood and fruits from around the world to China have been stranded at the country’s ports for weeks after Beijing extended the Lunar New Year holiday and cities across the country restricted free movement to contain the spread of the coronavirus.

With few truck drivers and workers at ports to handle cargo, refrigerated containers were trapped at ports already congested or redirected across Asia to find places where they could be connected to electricity.  In recent weeks, Beijing has allowed for more travel and offered financial support to companies to restart operations. Some ports chartered trains to transport truck drivers with the aim of speeding up container delivery.

According to a document released by the country, Shanghai, the largest container port by volume in the world, and Tianjin added 7,000 new points to connect containers, expanding the storage capacity of refrigerated cargo by 40%. About a third of the redirected cargo was brought back to China, he added.

Despite this, the global director of containers and maritime logistics for Danish carrier Blue Water Shipping stated that with many containers still stuck in Asia and shipping lines canceling voyages, a major imbalance in the market is also increasing freight rates. According to him, spot freight rates have increased by around 200% and are expected to increase even more.

Source: Reuters

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