According to the Drewry World Container Index, the spot freight rates have slightly increased compared to the previous week at 1.6%. Although, this remains 82% higher than one year ago. Of the major routes tracked by Drewery’s World Container Index, Shanghai to Los Angeles saw the largest increase at 5%. Shanghai to New York also moved up at 2%, while Rotterdam to New York saw a 1% increase. On the other side, Rotterdam to Shanghai dropped 5%, while Los Angeles to Shanghai saw a small decrease of 2%.
In an article from Fresh Fruit Portal, the USDA’s Agricultural Marketing Services was cited noting that California ports, namely the Port of Los Angeles and the Port of Long Beach continue to suffer from nearly record backlogs as over 100 container ships are waiting to be docked and unloaded. Adding to the pressure to clear the backlog are new outbreaks of COVID infections from the Omicron variant. The Wall Street Journal reported that as of the second week in January, nearly 1 in 10 daily dockworkers were unable to work due to testing positive, quarantining, or feeling ill. As cases continue to rise very quickly in the ports, it remains unseen how the supply chain will be affected.
Across the Pacific Ocean, things are equally uncertain as various cities around Chinese ports have detected Omicron cases. According to The New York Times, four of China’s largest port cities including Shanghai, Dalian, Tianjin, and Shenzhen have all introduced targeted lockdowns to try and control small outbreaks of Omicron. Port operations have remained open, but China’s zero-tolerance approach to COVID has many companies concerned if the outbreaks grow. Companies like Volkswagen and Toyota have already announced that they would temporarily suspend operations in Tianjin due to lockdowns.
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