Year Of The Dragon May Bring Supply Chain Hope

This weekend sees the start of Chinese New Year (CNY), which means China’s export production will effectively come to a halt for the next fortnight, as a new ‘Year of the Dragon’ gets under way.

Following a few weeks of ocean rates spiralling, schedule disruption, capacity issues, and equipment shortages, some in the industry are predicting that the situation will start to improve following CNY.

The lack of required sailings during the next fortnight should assist carriers, who are reportedly adding more capacity to cover the longer schedules. It takes a while to position the ships and the upcoming break in sailings will help that process.

This additional capacity, along with demand usually being lower following the Chinese holiday period, could mean an improvement in schedules and rates, but this still remains to be seen.

As far as Red Sea developments go, CMA CGM confirmed this week that all of their their vessels will now be routed around the Cape Of Good Hope. They had previously been the only major carrier that were continuing to operate some loops through the Suez Canal.

However, further attacks on ships seem to have led them to change their stance. A UK-owned ship came under attack in the Red Sea this week, when a missile of some kind passed over its deck and blew out the bridge windows. The crew were unharmed and the vessel proceeded on its planned journey.

Croft Cargo will keep you up to date with developments. In the meantime, we would like to wish you a Happy Chinese New Year!

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