Container shortage felt in Vis-Min; Manila with “healthy stock”

• Manila ports have a “healthy stock of containers” to serve exports amid a container shortage in Asia, according to the Association of International Shipping Lines
• There are reports of limited supply of containers in Cebu and of special containers like reefers in Mindanao
• The holidays are expected to aggravate the container shortage but the situation may change after Chinese New Year

Amid a container shortage across Asia, shipping lines calling Manila ports still have a “healthy stock” of export containers but carriers supplying containers to Cebu and Mindanao are reportedly experiencing some difficulties, according to Association of International Shipping Lines (AISL) president Patrick Ronas.

“As of the moment, carriers in Manila still have a healthy stock of containers to serve exports but we have heard of some limitation for carriers in supplying containers in Cebu and special containers like reefers to Mindanao to cater to banana exports,” Ronas told PortCalls in an email.

He said that while shipping lines are still able to address export demands from Manila, the situation varies from carrier to carrier.

There is currently a container shortage, particularly in Asia, especially with the popular 40-foot containers, as the COVID-19 pandemic triggered a series of events that led to months of imbalanced equipment flows.

“(Philippine) ports were not spared of this as operations in other ports in the world were also affected. Containers were not released in time from ports while factories were not returning empty containers back to the terminals for them to be shipped back,” Ronas explained.

“Initially, vessels were laid up or were returned to their owners as there was no cargo moving but in the past couple of months, the demand for them has come back,” Ronas added.

According to news reports, carriers’ blank sailings on the trans-Pacific trade and a spike in European imports from Asia in July and August as lockdowns were eased after reduced activity in prior months have caused shipping lines to struggle to return equipment to Asia.

The situation is also affecting cargoes in other countries, such as exports from North America and Canada, and has pushed up shipping rates.

Asked if carriers are imposing surcharges in relation to the container shortage, Ronas said: “I am not aware of any surcharges being levied against exporters because of such situation.”

He noted, however, that “there is a huge demand for containers in China as their factories are open, having been the first to get out of the limitations provided for by the pandemic and there have been reports of freight rates from China to the US and Europe going up by a hundred to 200 percent because of the limited supply of container and space on vessels.”

Charter hire rates on container vessels are also shooting up to unprecedented levels as countries all over try to restart their economy, Ronas said.

Holiday pressure

On whether the holidays would aggravate the container shortage, Ronas said they will for sure, as the demand for containers from China to North America and Europe is currently strong due to the Christmas season being “just around the corner.”

The Chinese New Year is also coming up in mid-February, which means factories in China will be ramping up their production volume prior to the holiday.

Ronas said the current situation may change after the Chinese New Year, but noted that “the persistent pandemic throws in a lot of uncertainties” so the situation in container demand may persist. – Roumina Pablo