Coronavirus’s Effect on Chinese Shipping

The Chinese New Year is traditionally a slower time for Chinese ports as people travel back to their homes to spend the holidays with their families. However, the Coronavirus has exacerbated this slow-down as a result of restrictions on movements within China.

In 2019 Chinese New Year began on 5th February, but the non-working holiday period started on 4th February and ran up to and including 10th February.

Figure 1 (below) shows vessel movements in Chinese ports start to drop-off right on schedule. The average of the DWT of tankers, container ships, or bulkers calling at Chinese ports in January 2019 was 25.0m per day, but for the 7 days of the Chinese New Year in 2019 this averaged 20.2m. Accordingly, we expect to see a monthly drop of around 19% in shipping activity in Chinese ports around the time of the Chinese New Year. Within 10 days of the end of the 2019 holiday period, the activity had picked back up to 23.5m and kept climbing to normal levels. 

However, on 22nd January 2020 Chinese officials announced a quarantine of the greater Wuhan, China area to commence 23rd January 2020 at 10:00 am. No traffic was to be allowed in or out of the city.

This coincided with the 2020 Chinese New Year holiday dates from January 24th up to and including January 30th.

Figure 2 (above) shows how this “perfect-storm” of restrictions on movements within China and the Chinese New Year 2020 holiday period have had a far greater impact on shipping numbers than normal. The average of the DWT of tankers, container ships, or bulkers calling at Chinese ports in December 2019 was 25.9m per day, and the average for the holiday period was 21m – dropping, as expected, by around 19%.

The key difference, though, is that these numbers continued to drop even after the holiday period had ceased. In fact, the tenth day after the end of the period, where one would generally expect numbers to get back to normal, showed that across the same vessel types, only 18.4m DWT of vessels were stopping at Chinese ports - a significant drop of 29% when compared with the December 2019 average. As can be seen in the chart above, this fell to below 18m DWT around the 19th February 2020.

Further, by examining MariTrace’s data, we can look at how different vessel types have been affected and, crucially, whether there are signs that a recovery in Chinese shipping has begun.

Figure 3 (below) clearly shows a distinct drop-off in bulker and container ship activity from the beginning of 2020, with tankers less affected until February 2020. However, while it seems that bulk carrier and tanker activity has troughed, container ship activity appears to be picking-up again.

This can be seen more clearly if we reduce the moving-average to a 5-day average as shown by Figure 4 (below).

Indeed, as reported by Reuters, Refinitiv are indicating that congestion levels in the Outer Pearl River Delta started to fall around the 19th February 2020, which matches MariTrace’s findings of an increase in port-calls beginning around the same date. Similarly, Zhoushan Port / the Shanghai International Shipping Institute are also showing an increase in volumes of container cargoes for exports being processed and the number of truck drivers returned for duty.

By examining MariTrace data it appears, then, as though the turning point may have arrived for Chinese shipping and a recovery may have begun. Still, this would assume that the spread of the virus is either kept at current levels or reduced – and this by no means assured.

Nevertheless, by keeping a careful eye on MariTrace’s daily data we can continue to monitor these figures and may yet observe another fall in vessel throughput in Chinese ports.

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