Qinhuangdao port enters lockdown as Beijing readies stimulus package

The northern port of Qinhuangdao in Hebei province is the latest Chinese commodities hub to get hit by a virus-related lockdown as China’s top politicians discuss urgent stimulus measures to pump-prime the national economy.

The city has locked down its Haigang district, which includes the giant coal handling complex, although officials at the port claim it is operating normally.

Nearby Tangshan, China’s largest steel producing city, has also been in lockdown for much of April.

On April 28, president Xi Jinping called for an “all-out” infrastructure splurge to promote economic growth. He then met with other government officials to discuss which measures ought to be taken.

Xi has called for more projects in transportation, energy and water conservancy, as well as new facilities for supercomputing, cloud computing and artificial intelligence.

The politburo meeting held today in Beijing issued the following communiqué: “The epidemic must be prevented, the economy must be stabilised, and development must be safe.”

Specifics of any stimulus package have yet to be revealed. Similar infrastructure splurges in the past have provided a big boost to the dry bulk shipping market in particular.

Citi analysts believe China’s infrastructure investment is likely to surge by 8% in 2022, sharply higher than the 0.4% increase seen in 2021.

“The infrastructure push is real,” they wroteon April 27, in a note. “The turning point for real policy actions may have arrived, and stimulus will likely come through more obviously from late Q2.”

Shanghai, in lockdown for the past month, reported its first increase in Covid-19 cases in six days yesterday with all indications suggesting it will be mid-May at the earliest before daily life in China’s largest city gets back to some semblance of normality.

According to S&P Global Market Intelligence, the total congestion level at ports across Shanghai has increased by about 30-40% as of April 25 since the start of March 2022.

Shanghai International Port Group (SIPG) is offering a 50% discount on container storage fees to help ease the financial fallout of the five-week long lockdown on shippers.

Citing satellite data, Bloomberg reported earlier this week that Chinese port activity has fallen below levels seen during the first coronavirus outbreak in 2020 and construction has plummeted.

Hangzhou, an e-commerce hub near Shanghai, started a mass testing drive while the massive southern city of Guangzhou cancelled hundreds of flights  and began testing 5.6m people over one suspected Covid-19 case.

Source: Splash247

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