The congestion and delay of Yantian Port and the suspension of the Suez Canal at the end of March are both a huge challenge for the shipping industry. So who has the greater impact?

The butterfly effect produced by the Yantian incident affects every participant in the supply chain, or is transmitted to the global shipping and supply chain with several times the impact of the Suez Canal accident.

Henrik Nielsen, executive vice president of Air & Sea at logistics giant DSV Panalpina, believes that the current situation in China is at least comparable to the blockage of the Suez Canal in March. The blockage of the Suez Canal interrupted trade in most parts of the world for nearly a week.

"This will be a challenge as big as the Suez Canal incident, and even greater. This is happening, and it continues." Nielsen said.

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On Tuesday, Lars Jensen, analyst and CEO of Vespucci Maritime, a maritime agency, said that Yantian Port was unable to handle 357,000 teu of cargo during this period. In addition, the impact of the situation in Yantian Port continues. Maersk reported that 40 ships were affected, while Hapag-Lloyd reported that 16 ships were affected.

"In this context, when the Suez Canal was blocked by Ever Given, it affected 55,000 teu's daily freight volume, but the Suez Canal blocked'only' lasted 6 days. In Yantian, we now see that it has been 14 days. , And the impact is still increasing.” Jensen wrote in an article on LinkedIn.

DSV estimates that it currently takes two to three weeks for a container to leave Yantian Port. The rerouting of ships and cargo to other ports also brought logistics challenges. The large number of rerouted containers caused serious port congestion in Shekou, Dachan Bay, and Nansha.

In addition, another large logistics company, DHL Global Forwarding, currently encourages customers to transfer goods to other ports as much as possible.

Its head of global shipping, Dominique von Orelli, wrote: “We maintain close contact with our partners and shipowners to keep up with the latest developments and encourage our customers to transfer their cargo to Shekou, Chiwan, Nansha or Hong Kong ports until Until the situation eases."
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In addition, Otto Schacht, executive vice president of maritime logistics at logistics company Kuehne+Nagel, said that the market will feel this impact at least for the next 6 to 9 months.

He said: "When shippers look for more containers and spaces, we will face more disruptions. The'aftershocks' will affect the world and every industry, and all of this will continue for at least 2-3 quarters." Expected market The difficulties will continue for a long time.

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Alternative solution

Nielsen explained that DSV Panalpina has adopted alternative methods of transporting goods along the supply chain, including rerouting by train or air transport, such as transporting containers by train to Europe and then by sea from Europe to the United States.

"We have to find alternative solutions for more than 10% of the daily volume of goods traded. Previously, we could at least predict the next three weeks or more. Now, things are changing every day, or every hour." He said.

He explained that after the Suez Canal was blocked, DSV Air & Sea began to look for alternative solutions. "Since then, we have had to think outside the box. This is a major challenge for customers, freight forwarders and carriers."

He added that for large container ships with a capacity of 20,000 teu, alternative solutions are not diverse. It needs to talk to customers, and it needs to determine and prioritize which goods are the most relevant.

"It is very important to maintain a dialogue with the customer and make recommendations on existing options. Because what is possible today may not be possible tomorrow," Nielsen said.

According to sources from Yantian Port, the west port area of Yantian Port has resumed operations and opened more berths. Starting from 0:00 on June 10th, Yantian International will receive ETA-7 days (that is, within seven days before the estimated ship arrival date) Heavy cabinets enter the gate; increase the number of trailers reserved for entering the gate to 6,000 per day.

Although the situation at Yantian Port has improved, the overall epidemic prevention and control measures of South China Port have affected the port's operating efficiency to varying degrees. Many cargo owners have begun to transfer goods to East China ports such as Shanghai and Ningbo. It is estimated that it will take several weeks for this key port in southern China to catch up and relieve the bottleneck.
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