Shanghai's port congestion is rising as a result of new lockdown restrictions.

The Shanghai lockdown has been prolonged indefinitely, casting greater doubt on Chinese supply chains as new data on the impact on China's freight volumes is revealed. Shippers and major carriers are trying to comprehend the full ramifications of China's decision to expand restricted COVID-19 limitations into a citywide lockdown on Shanghai's 26 million citizens, which also houses the world's busiest container port.  

Almost the whole city of Shanghai is now under lockdown, with most citizens unable to leave their houses, even for food, while other industries, including the container port, are allowed to operate under "closed-loop" conditions, in which personnel sleep on-site.   

While trucking services are still available in China's main ports and adjacent cities, for the time being, services in or out of Shanghai will be significantly disrupted due to a complete lockdown on Shanghai's Pudong and Puxi regions. Due to a decrease in trucking capacity and the shutdown of industries and warehouses, ocean freight has been rerouted to alternate ports, with Ningbo, Qingdao, and Tianjin topping the list.   

Import clearance is being hampered by a lack of trucks to transport containers from the port. Tightened restrictions on truckers in other parts of China are also delaying the delivery and return of containers to ports. According to various sources, frozen food containers and dangerous commodities such as lithium batteries and chemicals may be unable to land in Shanghai and may need to be rerouted to other ports. 

In China, truckers play an important role in supply chains, transporting raw materials from coastal ports to companies further inland. The backlog is undoubtedly contributing to the expanding ship queues off the coast of China, risking further delays and increased freight charges in the coming months. Because of this, industrial production suffers, landside logistics get hampered and ports become increasingly congested.  

There are fears that 2022 will be a repeat of early 2020, when covid caused significant disruptions in China.