Coronavirus lockdown traps drivers, leaving reefers stranded and a plug shortage

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The coronavirus crisis has caused a reefer box bottleneck, with carriers warning of surcharges and diverted cargo.

In a message to customers today, APL said: “Terminal operations and pick-up of inbound containers in China has been slow. Consequently, most reefer plugs at the yards of all container terminals in Shanghai and Tianjin are already occupied.”

The carrier said reefer boxes awaiting pick-up at container terminals in Shanghai may be temporarily stored and plugged in on board a vessel alongside, while others in transit to Shanghai or Tianjin might be re-routed for transhipment.

According to Zim, in addition to Shanghai, there is also a reefer plug shortage at Ningbo and Xingang, which has already forced the carrier to divert cargo from these ports.

“In order to cover the additional cost of re-routing the cargo, Zim will apply a congestion surcharge of $1,000 per container for all reefer shipments arriving into Shanghai, Ningbo and Xingan,” Zim said.

Maersk issued a similar warning on Friday to customers that it had diverted cargo after yard densities reached “critical levels” with no reefer plugs available. The line has also implemented a $1,000 surcharge for “all reefer cargo arriving into Shanghai and Xingang to cover the additional cost of re-routing”.

“We recommend customers, when possible, to ship to other Chinese destinations or other markets in order to avoid the congested ports,” advised Maersk, noting this applied in particular to time-sensitive cargo, such as fruit, vegetables and frozen meat.

Dream Xu, general manager of Worldwide Logistics Group, said the reefer congestion was due to a lack of truck drivers available to move cargo through the terminals.

He told The Loadstar: “Most of the reefer containers were overstocked at the terminals, which resulted in the lack of cold containers for customers to use. Both Yangshan and Waigaoqiao ports [in Shanghai] are overstocked with a large number of reefer boxes, and the terminal is short of available plugs at the moment.”

Mr Xu said many trucking companies had stopped accepting new business, or could only accept very few consignments, because the majority of their drivers were stranded in the coronavirus lockdown, “preventing drivers and other workers from travelling back to their place of work”.

He added: “Due to the shortage of labour, the ability of warehouses to receive and send goods is also greatly reduced.”

Indeed, while many businesses were expected to resume work yesterday, following the end of the extended lunar new year break, reports suggest many have remained closed due to public transport suspensions or concerns over staff safety.

“So far only 20% of factories have successfully resumed production but it’s expected to reach over 50% by next week,” said Mr Xu.

The reefer bottleneck in China will likely impact the supply of reefers available for export, as well as for perishable trades elsewhere in Asia, he added.