“Hundreds of ships stranded in Chinese ports!! » Editorial by Charles SANNET

My dear impertinents, dear impertinents,

About 500 ships are blocked off Chinese ports, with special mention for that of Shanghai.

The shutdown of Shanghai, imposed by Chinese authorities to combat a new Covid epidemic, is causing significant congestion at port terminals. Deprived of its workforce, put in solitary confinement for a fortnight like the entire population of the city, the port of Shanghai runs in slow motion. As a result, the number of ships waiting outside the terminals is skyrocketing. According to Bloomberg, as of Monday, April 11, 222 bulk carriers loaded mostly with minerals and grain were waiting outside the world’s second busiest port.

This traffic jam spreads to neighboring ports, shipowners are turning away en masse from the port where they can no longer unload. The neighboring and world’s largest port of Ningbo, for which 134 ships are waiting according to Bloomberg, is particularly affected. According to the American agency, a total of 477 bulk carriers were waiting in front of Chinese ports on April 11.

Container ships are not immune to traffic jams and are waiting to load in Chinese ports. Almost 200 of them were thus blocked off Ningbo and Shanghai.”.

Supply chains will break.

As in the worst of the 2020 pandemic, when Wuhan was under full lockdown and much of China was under partial lockdown, Shanghai has never been closed for this long.

While the confinement was only supposed to last a few days, after 15 days of confinement it was finally decided to extend it again by 15 days and the Chinese authorities seem unwilling to break with their 0-Covid strategy, which risks being swept away, no, who gets carried away by the contagious power of Omicron.

The Chinese authorities have actually made 0 Covid an untenable dogma.

So why this stubbornness?

In the meantime we will experience major supply shortages again as most of your orders are either at the dock in Shanghai or on blocked ships or factories not yet manufactured…

We will therefore see a second peak of tightness, which will inevitably be accompanied by a second peak of very high inflation.

Mobile stocks, ie in ships and in the transport stream are about 3 weeks. We’re going into the third week. At the end of April, the shelves begin to empty, always with a delay. Indeed you currently have what is being sold wholesale this summer and in June/July we are ordering what will be manufactured and supplied for the end of year celebrations.

In a word ?

Save on computer.

It’s already too late, but all is not lost.

Prepare yourself!

Karl SANNAT

“Insolentiae” means “impudence” in Latin.
To write to me charles@insolentiae.com
To write to my wife helene@insolentiae.com

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