Shipping
FLEXPORT: MAIN BOTTLENECK IN SHANGHAI IS LACK OF TRUCKING CAPACITY
April 28, 2022

Shanghai continues to undergo lockdown due to high amounts of Covid-19 cases although flight capacity is slowly recovering in the Chinese financial hub.

 

Flexport said in its latest update that despite this positive development movement of goods remains limited as trucking continues to be impacted by the lockdown measures.

 

"Flight capacity has recovered slightly compared to last week, but the main bottleneck is a lack of trucking capacity," Flexport said, adding, however, that despite this, airlines have increased rate levels as we head towards Golden Week.

 

Meanwhile, it said that most airlines in the US have canceled their flights into Shanghai due to the current COVID-related lockdown.

 

For South China, it said the flight frequency has still "not recovered" due to the Covid situation and war conflict, however demand continues to pick up.

 

Meanwhile, Flexport noted that rates maintain at around the same levels as last week and the market is quite strong before the holiday. 

For Taiwan, it said the market is "fairly stable" this week although capacity is a little tight due to the upcoming holiday but is overall still manageable. For Korea, TPEB space is tight ex-Korea mainly due to shipments being re-routed from North China to Korea as a result of the ongoing Covid lockdowns.

 

For the rest of Southeast Asia, the freight forwarder said demand ex-Thailand continues to be soft.

 

"Capacity on the TEPB trade lane may reduce during the upcoming Golden Week holiday. The market ex-Malaysia is still soft as a result of Ramadan, however, capacity on the FEWB trade lane will increase starting this week," it said.

 

Flexport added that demand ex-Vietnam continues to be weak, while rates levels ex-HAN have dropped slightly while ex-SGN rates remain similar to last week.

 

In terms of shipping, Flexport said disruptions continue to dominate the Asia-Europe trade.

 

"The Shanghai lockdown and various other local restrictions across cities in East and North China are affecting factory production, warehousing, and trucking availability. It is expected that there will likely be some port omissions and blank sailings announced by carriers as a response to recent developments," Flexport said.

 

"On the destination side in Europe, there is the impact due to congestion in several ports which is causing re-routings and further delays."

 

It added that rates remain at a high level but have been on a downward trend throughout March and April due to a slowdown in the market.