Shortages of empty containers and voyage cancelations could persist for several more months and drive up freight rates, with the arrival of the peak sales season and lingering congestion at ports in Europe, the US and China, said the local branch of DB Schenker, a leader in supply chain management and logistics solutions.
“Empty container shortages are worsened by port congestion in Europe and the US, and recently, by China’s Yantian port backlog,” Schenker Taiwan vice president Antoine Bouin told an online news conference on Monday.
Ongoing disruptions at ports in southern China would have a more serious effect on the market than the earlier Suez Canal incident in late March, as Yantian port in Guangdong Province’s Shenzhen handles 24 percent of China’s total exports, Bouin said.
A COVID-19 outbreak caused Yantian port to close for a week last month, and subsequent controls and access limits have seriously reduced operations, he said, adding that congestion at Yantian spilled over to other ports in Guangdong and Asia.
As of last week, more than 50 vessels were waiting to dock, and 300 vessels skipped Yantian between June 1 and 15, he said.
The port is back at normal capacity, but the backlog is likely to take several weeks to clear, Bouin said.
Significant flow imbalances also added to shipping chaos in light of high volumes moving from Asia to Europe and the US, but low volumes coming from Europe and the US to Asia, he said.
Port congestion, berthing delays, flow imbalances and the slow return of empty containers have caused shipping lines to skip some of their regular trips and pushed global shipping schedule reliability to a historic low, he said.
Freight rates are likely to remain high for the rest of this year, Bouin said.
For Taiwan, freight rates and the container situation would be slightly better, as the arrival of new megaships at Evergreen Marine Corp (長榮海運) would help, he said.
Bouin said that companies should draw up accurate forecasts of volume for next quarter, plan together with shipping lines and make capacity commitments to secure space.
STEADY: Prices are to rebound following inventory rebuilding demand, TrendForce said, with Samsung Electronics Co further trimming capacity as it slashes DDR4 lines The contract prices of DRAM chips are to rise by as much as 18 percent sequentially this quarter — the first price upticks in about eight quarters — driven mainly by inventory rebuilding demand for DRAM chips used in mobile devices and PCs, TrendForce Corp (集邦科技) projected yesterday. The price rebound is led by a quarterly increase of mobile DRAM chips, which are to climb between 13 percent and 18 percent quarter-on-quarter this quarter, which has not been seen since the fourth quarter of 2021, the Taipei-based market researcher predicted. Likewise, the price of mainstream PC DDR4 DRAM is expected to bounce
CHINA NOT A FRIEND: ‘Newsflash: Democracy is good for your businesses,’ US Secretary of Commerce Gina Raimondo said as she gave a speech at a national defense forum US Secretary of Commerce Gina Raimondo on Saturday urged lawmakers, Silicon Valley and US allies to stop China from getting semiconductors and cutting-edge technologies key to national security. Speaking at an annual national defense forum in Simi Valley, California, Raimondo called Beijing “the biggest threat we’ve ever had” and stressed that “China is not our friend.” The world’s top two economies are locked in a fierce commercial and geopolitical rivalry, in which her department plays a leading role. In October, Raimondo unveiled a series of restrictions on the export of advanced chips to China, including those used in the development of artificial intelligence
SOLID FOUNDATION: Given its decades of expertise in megatronics, manufacturing and robotics, Japan has the wherewithal to create its own AI, Jensen Huang said Nvidia Corp plans to help build an artificial intelligence (AI) tech-related ecosystem in Japan to meet demand in a country eager to gain an edge in this emerging technology. The US company will seek to partner with Japanese research organizations, companies and start-ups to build factories for AI, Nvidia CEO Jensen Huang (黃仁勳) said yesterday during opening remarks in a meeting with Japanese Minister of Economy, Trade and Industry Yasutoshi Nishimura. The company is to set up an AI research laboratory, and invest in local start-ups and educate the public on using AI, Huang said. Huang earlier this week met with Japanese Prime
A Hong Kong court postponed a court hearing on troubled Chinese property developer Evergrande Group’s (恆大集團) winding-up petition scheduled for yesterday until Jan. 29. Evergrande is trying to win support from its creditors for a plan to restructure more than US$300 billion in debt to stave off liquidation. The company’s lawyer told the court it was requesting an adjournment to “refine” its new debt restructuring plan. The Hong Kong High Court has postponed the hearing over Evergrande’s potential liquidation several times. Judge Linda Chan (陳靜芬) had said in October that yesterday’s hearing would be the last before a decision is handed down. Chan