Chinese Officials Call for Cooperation to End Container Shortage

With reports of growing congestion and the lack of containers spreading into China's major ports, Chinese officials are calling for great cooperation to maintain trade and slow the rise in container rates.  They recently called on the ports and shipping associations to work with the international carriers to resolve the container shortage.

Speaking at a meeting hosted by the Ministry of Transportation, the Chinese officials said that the China Ports and Harbors Association (CPHA) and China Shipowners’ Association (CSA) need to work together to reduce the shortage of containers which is critical for foreign trade. The Ministry acknowledged that the rebound in trade that started in mid-2020 was contributing to the shortage of containers. They also, however, cited the slow return of containers from North America to Asia as a contributor to the current shortage in China as well as on other trade routes.

According to reports in the Journal of Commerce, the shortages have become more acute in the major Chinese ports as the manufacturers and ports work to move goods before the lunar New Year celebration. Ports such as Shanghai, which is the world’s busiest container port, are reporting increasing backlogs. Last October, Shanghai set a new record of 4.2 million TEU moved in one month, and for all of 2020 the port handled 43.5 million TEU, which represented a small increase of 2019.

Citing the backlogs and shortages that are being experienced in China, Container News reports that the Chinese officials said that improvements in capacity and container supply, as well as co-operation with overseas ports and agencies is necessary. They quoted the officials as saying, “Various liner operators have optimized the allocation of ships to their service routes, and we will continue to facilitate outbound trade by ensuring that transportation is smooth. However, due to congestion in overseas ports, poor collection and distribution systems, and difficulties in returning empty containers, the disparity between shipping capacity and container supply is still obvious.”

The inefficiencies were cited as a contributing factor to the rise in container shipping rates experienced in 2020. The officials said greater cooperation was required to meet these challenges.

According to the Journal of Commerce, China’s major exports all plan to remain open through the Golden Week holiday, and despite some workers departing to go home for the holiday, the ports are hoping to use the period to reduce the backlog. Many of China manufacturers however are also planning to work through the holiday this year meaning that the flow of export goods into the ports will also continue.

In 2020, China reported that it was taking steps to increase the supply of containers. They said that China was working with related parties to provide more containers to the market, speed up the turnaround of containers, and help container manufacturers to expand productivity. The state media noted that the China Container Industry Association was urging shipping container manufacturers to increase the production of the standard boxes. They reported that China has produced 300,000 TEUs per month since September to help ease the shortage and that Chinese container manufacturers had extended their normal working hours to 11 hours a day.