Why 2021 Lunar New Year Didn’t Bring the Reprieve We Hoped For

Why 2021 Lunar New Year Didn’t Bring the Reprieve We Hoped For

By now, the shortages and delays plaguing the international shipping industry should be news to no-one. But if you’ve been living under a rock here’s a quick refresher!

2020 ushered in a year of impacts that hit ports and shipping lines around the globe. Remember that all too familiar word ‘unprecedented’? Yep, it sure was.

Why? Well the main reasons were:

  • Shipping Container Shortages: COVID-19 led to a trend of containers that were shipped from the Asian continent, not returning empty back to Asia. The domino effect of that trend caused an imbalance in the availability of shipping containers right around the world.
  • Shortages of Ships: On an average year, around 5-10 percent of shipping vessels worldwide are unavailable or not currently active. During COVID, that rate sat at about 1.4 percent.
  • Chinese exports getting priority: Active shipping lines were skipping export opportunities from Australia and the United States, instead picking up empty boxes and taking them back to China as that option is more lucrative.

The stats now back up what we all felt like we were experiencing. SeaIntelligence Consulting crunched the numbers from last year and found that global container service scheduled reliability declined to its lowest levels since records began. In fact, data for December showed just 44.6% of vessels were arriving on time. It wasn’t just December though – SeaIntelligence Consulting says global schedule reliability had been at its lowest for five months consecutively up until December.

There had been hope over the Christmas period that Chinese New Year may have brought some welcome relief to delays. But as we now know, history does have a habit of repeating itself.

Shipping technology firm Ocean Insights has had a look at the detail and found that 2021 is actually faring worse when it comes to carriers’ schedule reliability. The average delay for containers in January 2020 was one day. January 2021? More than five days. They, like many other firms, are also warning that it may take several more months for supply chains to return to conditions like we saw before COVID.

What happens in and out of China does tend to dictate how industry shipping conditions are faring, and although we’re enjoying a (relatively) COVID-free existence here in Australia, travel restrictions are still very much a live issue within China. Chinese authorities still require people to quarantine for 14 days after they’ve travelled which isn’t helping the situation. Chunyun, or Spring Festival, is traditionally the biggest migration event on the planet each year as millions of people head home to spend time with family before the Lunar New Year. Last year’s Spring Festival became a superspreader event so local authorities made an effort to encourage people to stay put this year and celebrate in place. Factories were kept open too in order to try and keep up output instead of experiencing the lull that usually happens at this time of year.

Read more here.

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