Shipping volumes out of China are plummeting as the impact of the coronavirus outbreak takes a deeper toll on industrial production, and ocean carriers are bracing for financial blows from the diminished output.
“Substantially less cargo is being moved between China and the rest of the world” said Lars Jensen, head of Denmark-based maritime research group Sea-Intelligence. “Last week we had an additional 30 sailings cancelled, with 23 across the Pacific and the rest to Europe.”
Mr. Jensen said the cancelled trips, which have topped 50 since late January, will delay or reduce shipments into the U.S., where retailers may see a slowdown in their traditional restocking of inventories for the spring.
Five European and Asian container ship operators told the Journal they are preparing profit warnings for the first half or the full year.
Companies exporting goods into China are also facing problems because only a fraction of workers are back at work to handle goods arriving at ports. That has backed up cargo at terminals and warehouses at big gateways including Shanghai, Tianjin and Ningbo.
The China Association of the National Shipbuilding Industry said more than 200 deliveries of ships under repairs or retrofitting could be pushed back. China is the world’s biggest shipbuilder, with more than 960 vessels set to be delivered this year, according to data provider VesselsValue.
First published in the WSJ.
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