A new wave of quarantine, a war in Ukraine: how it will affect global logistics

A new wave of quarantine, a war in Ukraine: how it will affect global logistics

Freight rates jumped 400% due to massive port closures in China. All this is exacerbated by disruptions in the supply chain and shortages of goods. Is a shipping crisis nearby? The answer is in PartnerTrade’s material.

What is happening with the industry?

The logistics chain did not have time to recover from the situation in the ports of Los Angeles, as it faced new challenges. Harbor congestion in China has led to the sudden closure of most ports, resulting in higher freight rates and business shutdowns.

Vessel traffic jams at key Chinese ports

Logistics companies and carriers note delays in deliveries due to large queues of ships in Chinese ports. The new outbreak of coronavirus in manufacturing centers is to blame.

Over the past week, many manufacturers have curtailed their work due to tough government requirements that want to stop the spread of the pandemic.

Manufacturers are massively stopping production, which is why the prices of some goods have increased significantly, and the import of others has completely stopped.

Warehouse logistics crisis in China

Logistics operators in China said new government measures forced the closure of up to 90% of warehouses in Shenzhen. This, in turn, has caused congestion of container ships, long delays in cargo, and increased operating costs for carriers.

The cost of freight in the direction of China-USA has increased. In January 2022, it was $16,000. Currently, rates have increased even more. High tariffs, in particular, affect shippers who ship goods to North America.

The Russian invasion of Ukraine

Supply chains have also been affected by the war in Ukraine. This especially affected the delivery of agricultural products. Inventories of basic products are shrinking, provoking inflation.

Food suppliers cannot supply grain, as they provide for the needs within Ukraine, other exporters do not have the opportunity to collect and send the crop.

World prices for grain crops have reached a historical maximum, a further rise in prices may cause a shortage of products shortly.

Food shortages in the US

There is also a food shortage brewing in the United States that is already being felt by consumers.

RetailWire analysis showed that the US food crisis was affected by a decline in domestic production, natural disasters, wildfires, climate change, and pest reproduction.

In addition, US fertilizer imports have fallen by 50% as the commodity’s largest exporter is in a military conflict. This caused the curtailment of most of the sowing campaigns.

Experts predict that the conditions for the supply of products will worsen this year, given the increase in transport costs, a shortage of workers, and delivery difficulties.

The American economy will have to go through a difficult period due to the instability of the economy and food shortages.

What to do?

The whole world is waiting for the end of the war in Ukraine and the improvement of the epidemiological situation in China, the solution to these problems will eliminate traffic jams in ports, curtailment of businesses, and lack of food.

In the meantime, government officials, logistics operators, carriers, and importers are looking for the best solution to group the participants in the supply chain and ensure food for consumers.

PartnerTrade is also looking for new ways to deliver goods to different parts of the world. Our managers lay out routes, find carriers, agents, and customs brokers – do everything to ensure that your cargoes arrive successfully at the specified time, date, and city.

If you want to get a full calculation of the estimate for delivery – leave a request on the website or write to WhatsApp: +1 718 705 7589.


Why is the cost of transporting goods rising again?

This was largely influenced by disruptions in the supply chain due to Russia’s war against Ukraine and pandemic precautions in Chinese ports.

What’s going on with the global supply chain?

The main supply chains have been disrupted. This was influenced by the harbors in China filled with ships, the closure of ports, warehouses, and increased freight rates.

How will the supply chain crisis affect the US?

Due to disruptions in delivery, shortages of basic food items may occur. In addition, food shortages provoke a limited supply of imported products, a lack of fertilizer supplies, and the reproduction of harmful insects.