Impact from Ningbo Closing Less Than Feared, as Reopening is Expected
The closure of one of the container terminals in China’s Ningbo-Zhoushan port complex is set to enter its second week with reports of continued disruptions and bottlenecks beginning to ripple across the global supply chain. However, with rumors that the terminal will soon begin a phased reopening, a new data analysis from the logistics platform project44 indicates the disruptions might not be as bad as first feared.
Operations at the Meishan terminal were suspended on August 11 after a positive COVID-19 test the prior day from one of the workers who also lives at the port complex. Health officials in Ningbo, however, reported a week later that no additional positive tests have been reported. They remain cautious following China’s strict zero-tolerance policy toward the virus.
Freight agents in the port have reportedly begun to advise customers that they expect that a phased reopening will be implemented for the terminal possibly as early as this week. If the Chinese authorities being resuming work at the port as expected, it is forecast that the Meishan terminal and port area could be back to normal operations by the end of the month.
Initially, there had been fears of far-reaching implications from the closure of the terminal, but while backlogs have developed the Chinese port officials and major carriers seem to be handling the closure better than the similar situation in Yantian in May. In part, it might be due to the larger size of the Ningbo port complex and the distance between terminals.
Project44 ‘s analysis shows that while the number of vessels has increased in the anchorage to 41 as of August 17, there has not been the large-scale blanking of sailing by the carriers. Maersk, for example, said six ships would skip the port during August, with project44 tallying a total of only 15 blank sailings to Ningbo-Zhoushan. Project44 reports last week that there was a 22 percent decline in port calls by containerships “which coincides with the volume of container cargo the Meishan island port terminal handles.”
Some carriers are diverting to other terminals within the port complex, but that has not created a significant increase in waiting times. Maersk is advising customers that the waiting time remains about two days at two others terminals, Ningbo Beilun and Yongzhou, while other operations continue as normal. Project44 judges that there was an eight percent decline in total nominal TEU capacity calling at Ningbo.
“According to port authorities, the port processed an average of about 77,000 TEU a day,” writes project 44, “which was only 10 percent lower than what it averaged in July.” However, project44 also reported that the total nominal TEU capacity for vessels mooring at Ningbo decreased 39 percent last week, contributing to the backlog forming at the port and along the supply lines.
According to project44 data, “the effects of the Ningbo shutdown are not nearly as significant as the Yantian shutdown.” It however remains to be seen if the Meishan terminal will resume at least limited operations this week and then how quickly the backlogs can be cleared.