Port of Ningbo Open, but Logistics Services Suffer as Covid Restrictions are Tightened

Services at the port of Ningbo are operating normally – although the Zhejiang Province government has instigated quarantine and disinfection action for the Beilun district of the city.

Three of Ningbo’s container terminals border Beilun district, where, reportedly, 23 people have tested positive for Covid-19 – Ningbo Beilun Container Terminal (NBCT), Ningbo Beilun Second (NBSCT) and Ningbo Beilun Third (NBTCT) – but there are no reports of infections in the port itself.

According to Maersk Line, loading and discharge operations at the three terminals are working normally, while gate-in and out operations have seen some restrictions  imposed on 1 January.

Meanwhile, operations at the Ningbo Bluedragon LongXing warehouse have been suspended until further notice, but the Ningbo Bluedragon LongFei remains open for import and export cargo at NBTCT and Ningbo Meishan Island International Container Terminal. Empty container operations at the Greating Fortune Yard 3, Hongda Yard and CIMC Yard 1 have all ceased operations.

Maersk told customers trucking services outside the Beilun District had been suspended to prevent the spread of infections and truckers must apply for permits to operate.

It said approximately 20% of drivers had been permitted to operate, adding: “Zhejiang provincial government, local governments and Ningbo port are in search of regulations to mitigate the impact on logistics transport. Some areas have issued policies to allow trucks from [the] Beilun area to operate under strict control.”

Beilun District outlined in red

Lars Jensen, CEO of liner consultancy Vespucci Maritime, commenting via LinkedIn, suggested that China’s continued use of a zero-tolerance policy towards Covid-19 combined with the rise of the more contagious omicron variant means that the risks of larger disruptions to not only supply chains but also manufacturing are significant in the coming weeks.

Thursday January 6th Update:

Forwarders are shifting volumes to congested-Shanghai to avoid landside delays, despite carrier schedules so far unaffected by the newest Covid-disruption at Ningbo.

Ningbo-Zhoushan Port has repeatedly fallen victim to China’s tough Covid restrictions over the past six months, with the latest lockdown taking place in Ningbo’s Beilun district, which borders three of the port’s container terminals.

Container loading and discharge is operating normally, but the impact on trucking and access to the port is severe, according to local forwarders.

One contact has said: “Many truckers live in Beilun and there are complicated Covid-19 control policies there, so it’s extremely difficult to bring containers in or out.”

He added: “Some shipping lines may decide to omit Ningbo and, as there is only three or four weeks until Chinese New Year, we recommend shipping as early as possible from alternative ports instead of queuing for Beilun.”

LCL cargo has been “severely affected”, another forwarder said, as some consolidated containers were stuck at warehouses until they could be gated-in. The forwarder told customers: “For any LCL shipments booked from Ningbo but not delivered to us yet, please cancel the booking from Ningbo and divert the shipment to Shanghai immediately.”

A logistics company has said trucks could not move from Ningbo to most nearby cities, and drivers entering the city faced a 14-day quarantine. Therefore, it added, many international bookings were being rerouted through other ports which, in turn, is putting additional pressure on those hubs.

The logistics company continued: “Internal transport and landside costs are spiralling in some areas, typically round-trips to and from Shanghai take up to an additional eight hours. Ocean freight availability and rates, from both Ningbo and Shanghai, are likely to be impacted.”

Another logistics company warned truck capacity could deteriorate, despite the introduction of a “green pass” scheme by the local government, adding: “While some 20% of drivers are getting their passes, others are under 14-day quarantines and we anticipate trucker shortages will increase.”

A freight forwarder warned: “Heightened restrictions could result in production disruptions, including short-term delivery and order fulfilment delays. With many factories closing ahead of the new year holidays, from the middle of January, it is possible that orders may be held or unable to ship before the holiday, and carriers may cancel more sailings.”

Monday 10th January Update:

Chinese authorities have temporarily locked down the Beilun district of Ningbo and increased testing of workers after detecting about two dozen COVID cases at a clothing factory, according to multiple reports from the area.

The restrictions are adding delays for truck drivers that shuttle loaded and empty containers between factories and the port. The production and transport disruptions are likely to delay exports and the return of empty containers to factories from overseas.

Vessel operations at the three container terminals near the Beilun district have not been slowed so far, according to a customer update from mega-shipping line Maersk on Thursday. But trucks serving the port are only permitted through a limited number of gates and operations at the Ningbo Bluedragon LongXing warehouse zone have been completely suspended until further notice.

Logistics providers worry that smooth operations on the waterside could soon feel ripple effects from landside backlogs, as exports and empty containers stack up in the port and inbound shipments remain trapped at factories or warehouses.

A major logistics complication is the lack of trucking permits for commercial vehicles to enter the Beilun district. The local government in Zhejiang province has only released 6,000 permits for the 20,000 trucks in the area. Truckers with permits must take two nucleic acid tests in three days and are required not to leave their vehicles while in the marine terminal.

Maersk said that about 10% of trucking capacity is operating.

Information sourced from herehere and here.