As China ’s slowing economic activity begins to have a greater impact on maritime operations from shipyards to bulk commodity carriers, a new report claims that the decline in trade volume caused by the new crown virus epidemic is causing container shipping companies to lose 350 million per week USD shipping revenue.
Danish maritime data provider Sea-Intelligence said on Monday that the number of containers in the global trading network has dropped by 350,000 since the outbreak last month.
According to the agency, 21 trans-Pacific routes were cancelled due to the epidemic, equivalent to 198,500 teu, while the number of cancellations on Eurasia was estimated to be 10, equivalent to 151,500 teu. In addition to the 61 routes that have been suspended during the Lunar New Year, the total number of suspended routes has reached 82.
It is worth mentioning that Alphaliner, another research institution, has previously published a report that the Spring Festival holiday extended to slow the spread of the virus, coupled with the impact of shipping lines cancelled by shipping companies, may lead to Chinese containers including Hong Kong Port throughput decreased by approximately 6 million TEUs in the first quarter of this year.
Alphaliner added that the full impact cannot be fully measured until ports report their first-quarter throughput data. However, from the data collected by container ships calling at major ports in China every week, the number of container ships has been reduced by more than 20% since January 20.
According to the recent data released by Weiyun.com, due to the impact of the Spring Festival epidemic, shipping companies suspended a large area in February! The percentage of suspensions exceeded 35%.
Another research institute, Fearnleys Securities, also issued a warning that due to the impact of the new crown epidemic, the container shipping market is facing a more bleak outlook in the next few weeks.
It warns that future employment prospects for container ships will be bleak due to the effects of the coronavirus.
The agency's analysts Espen Landmark Fjermestad and Peder Nicolai Jarlsby said: "At least 24 provinces in China (accounting for more than 80% of the country's GDP and total exports accounting for 90% of the country's total) have extended the Spring Festival holiday. Therefore, In a few months, we will definitely see a significant impact on container shipments. "
The two analysts said that "the supply chain of auto parts and electronics has been short of gaps" and they expect that, in response, shipping companies will "substantially stop shipping in the short term."
They also said: "Because market balance is already fragile (demand growth is expected to be 2-3% in 2020) and the total delivery capacity of the new shipping plan is 5%, which may have a significant impact on spot freight and contract renewals . "
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Hales H.//SMC Editor