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Effects of a Recent COVID Outbreak to be Felt Longer than Expected

The 375,000-container backlog at Yantian Terminal, caused by a late May 2021 shutting down due to a significant COVID-19 outbreak among workers, has shown signs of easing. Yet, some experts believe that these signs may be a mirage, and the damage may be too much to overcome as we enter peak season.

While the backlog of containers has started to clear, the number of boxes that continued to be stacked during the Yantian shut-down was significant. This will require all the delayed and in-coming containers to be moved at the same time during peak season. Adding to the problem is that other Chinese ports near Yantian were forced to pick up the slack, and as a result, have also been experiencing their own severe backlogs.

“The COVID incident at Yantian is proving one flare at a high-volume port can have significant consequences, meaning customers need to continue to be vigilant, prepared, and proactive enough to adjust plans accordingly,” said Anthony Fullbrook, President of OEC Group’s Northeast Region. “The lesson all of us need to remember is that, regardless of what anyone says, we are not out of the woods with COVID.”

A recent move by Maersk to restart 19 mainline services it diverted from Yantian due to COVID complications was made with the intention to help alleviate the backlog. While many in the industry believe that Maersk’s move was a step in the right direction, others believe it will not be enough as projections on prolonged congestion at ports around South China, specifically Yantian, are ranging from two weeks to three months. The most likely estimated range lands between 80 and 90 days.

“The issues at Yantian are compounding on other problems the industry has been dealing with for the past 18-months, namely substantial delays in ports around the globe, low carrier reliability and equipment imbalances,” explained Frank Costa, Vice President of Sales for OEC Group’s Northeast Region, “There’s never a good time for a backlog like the one we’re seeing in South China, but right now is a particularly bad time, and it is possible that the industry impact from Yantian’s problems will last closer to the three-month projection range and possibly longer.”
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