Explanation of shipments under the epidemic control policy and forecast for the second half of the year

The Port of Shanghai has been in a virtual shutdown since the city was closed in mid to late March. All shipments via the Shanghai port cannot be sent out, and in fact, freight vehicles have not been able to enter Shanghai at all for the last two months. Even if some freight companies can enter Shanghai through some special channels, the freight quotes are incredibly high. As a result, exporters in the Yangtze River Delta region tried to ship their goods through other nearby ports, such as Ningbo Port and Qingdao Port. But in fact, due to the spillover of the epidemic from Shanghai, the neighboring provinces also took the same control measures to varying degrees, which led to a significant decrease in the efficiency of highway operation. For example, the original journey from Nantong to Ningbo can be reached by freight trucks in one day, but in April this time often takes 2-3 days. In addition, due to the epidemic and the impact of lockdown in Shanghai, a large number of export enterprises export goods hoarded, at the same time at Ningbo Port, the goods piled up like a mountain, the ship schedule is extremely tight. These in turn led to a sharp rise in freight prices. At the peak, the freight fee for one ton shipped from Jiangsu to Ningbo port was for up to 10,000 RMB. Even today (May 18, 2022),  freight rates for this section are still high. Moreover, it usually takes 2-3 days to queue up for warehousing at Ningbo port, and freight companies often charge RMB 60 per hour for queuing. This series of cost increases is unaffordable for products with low added value like our sliding gate wheels and gate accessories.

According to the forecast, Shanghai will be unsealed city-wide on June 1 at the earliest, but the port terminal must be very, very crowded at the initial stage of unsealing, and perhaps it will take early July at the earliest for everything to really go back to normal. So, please be patient. In fact, as I said in my last blog, the best time to place an order is after the Chinese New Year holiday in February. Based on time for production and shipment we needed, if an order is placed before or after the Chinese New Year holiday in 2022, we can basically complete the production and shipment of goods before the lockdown in Shanghai.

The trend of the epidemic may be normalized, and no one knows if the epidemic will come back. It is predicted that there is still a possibility of a wave of epidemic in this year’s fall and winter seasons, and possibly a new variant of Omicron will appear. Therefore, for all customers, June to October is the best time period to place orders for the rest of the year. The months after that are feared to be affected by many uncertainties.