Carriers are warning US exporters that with Chinese factories crippled for a third consecutive week and carrier announcements of more than 80 blank sailings in February and March, the shortage of empty containers beginning to surface in the US interior will intensify in the coming weeks. “The imminent thing is the escalating number of blank sailings. That is going to have an impact on the influx of equipment to the US,” said Uffe Ostergaard, president of Hapag-Lloyd Americas.

A sudden downturn in imports can result in a shortage of containers that are available to carry US exports. With fewer laden inbound containers unloading in population centers such as Chicago, Minneapolis or Columbus, Ohio, there will be insufficient empty containers in those regions to meet the demand from exporters for products such as scrap materials or agricultural commodities.

Blank sailings could spawn container shortages

Carriers are beginning to notify customers that the growing number of blank sailings in the trans-Pacific due to factory shutdowns in Asia for the week of Lunar New Year in late January, followed by extended shutdowns due to the coronavirus in China, would disrupt the flow of import containers into the US. “The carriers are notifying us about a shortage,” said Hayden Swofford, independent administrator of the Pacific Northwest Asia Shippers Association, which represents forest products exporters. The container shortages normally develop first in the interior, but eventually work their way back to the West Coast, he said.

Exporters of soybeans and specialty agricultural products in the upper Midwest have begun to experience problems getting all of the empty containers they need, said Bruce Abbe, transportation strategy adviser to the Specialty Soya and Grains Alliance. “It’s blank sailings compounding other blank sailings,” Abbe said. Canceled sailings and staff shortages at shipping lines and warehouses across Asia, especially in China, are limiting the volume of Asian exports to the US, he said. Spot shortages of containers are surfacing near hubs such as Chicago and Minneapolis. “There’s a lot of uncertainty now. Everybody will be looking to do work-arounds the best we can,” Abbe said.

From past experiences after the Lunar New Year, exporters around Chicago, Minneapolis, Detroit, and Cincinnati and Columbus in the Ohio Valley, will probably encounter shortages of empty containers, which could be more extensive this year because of the extended factory closures due to the coronavirus.

Source: JOC