China’s dominance over container trade risked by ‘zero Covid’ policies
China’s ports have continued to dominate the container trade, according to a recent survey.
Figures published today by Lloyd’s List show that 40 per cent of all twenty-foot equivalent unit (TEU) liftings in 2021 came from China.
The country also had seven of the world’s biggest ports – including Shanghai, which won the first prize for the 12th consecutive year.
Singapore and Hong Kong came in second and eighth respectively, while the port of Rotterdam was the only European hub to rank.
However, China’s leadership in the shipping industry could be at risk as the country introduced yesterday a fresh set of Covid restrictions in major cities.
The latest curbs are a reflection of China’s “zero Covid” policy which makes it an outlier as most countries have moved to living with the virus.
According to a note from financial services firm Nomura, restrictions could impact markets in the next couple of weeks, “likely triggering another round of cuts by economists on the street.”
Manufacturers told City A.M. in late May that China’s ongoing lockdowns were exacerbating the supply chain crisis, already plagued by component shortages.
“Our members have been telling us that the issue around the Russia Ukraine conflict although has been a problematic issue for them, such as the situation in China for example, the increasing level of lockdown and the resurgence of Covid and the shutting of ports in Shanghai, have made it significantly more difficult for industries in the UK to get access to much needed parts,” Make UK senior economist Fhaheen Khan told City PM
“Although China’s strict Covid stance brought significant disruption to ports and similarly to factory production, the country’s major gateways combined to achieve throughput growth of around 6% year on year, according to Lloyd’s List’s annual Top 100 Container Ports ranking.
One expert told CityA.M. that China’s dominant role in global containerised trade was “unwavering”, with Richard Meade, editor at Lloyd’s List, pointing out that China’s ports take up just under 40 per cent of total containerised trade.
“And, while there is evidence of further growth at ports in Southeast Asia, as more companies set up manufacturing bases in the region, talk of a shift of production away from China is wide of the mark,” he added.