China’s decision to partially shut the world’s third-busiest container port due to the COVID-19 outbreak is worrying investors across the globe who fear a repeat of the worst days of the pandemic last year.
The Port of Los Angeles, which experienced a dip in volumes due to a June COVID-19 outbreak at the Yantian port in China, said it’s possible that they’ll see something similar at the Ningbo-Zhoushan port, according to a spokesman. Anton Posner, chief executive officer of supply-chain management company Mercury Resources, said that many charterers are already adding COVID-19 contract clauses as insurance so they won’t have to pay for stranded ships.
“Looks like things were just going to calm down, we’re now into delta delays,” Emmanouil Xidias, partner at Ifchor North America LLC, said in a phone interview. “The logistics are following COVID. COVID now went to delta, we’re doing the same thing in logistics. You’re going to have a secondary hit.”
The Baltic Dry Index that serves as a global benchmark for bulk shipping prices is up more than 10% since a month ago as the delta variant began to spread rapidly. While there haven’t been significant effects on U.S. ports, the problems in China could hurt companies that rely on container exports from the nation.
