Ports braced for chaos as China pumps out exports
Ministers scramble to put contingency plans in place for shipments arriving just as major rail strike hits
PORT chiefs are bracing for a fresh round of supply chain chaos as a glut of goods arriving from China coincides with drawn-out rail strikes.
An “avalanche” of imports on board shipping liners from the Far East is expected to arrive in around six weeks after factories and ports in China reopened following Covid lockdowns.
The supplies risk reaching docks at the same time as Britain is in the grip over its biggest rail strike for decades. Nearly a third of all containers unloaded in the UK move onto the railways for transportation to their final destination.
Ministers have held talks with port chiefs to map out contingency plans if the Rail, Maritime and Transport (RMT) union follows through with threats for industrial action that will last “a very, very long long time”.
Richard Ballantyne, chief executive of the British Ports Association, said: “If it was a long drawn out strike over many weeks you could start seeing an impact … Then it could lead to issues.”
Mick Lynch, general secretary of the RMT, has said that he “cannot see a way out from the strikes”. Speaking at the weekend, he said: “They could go on for a very, very long time. There is no sign at the moment that anybody is backing on their side of the table.”
As Chinese ports open back up and goods make their way west, Mr Ballantyne said that there would be an “increased glut of containers and products at port terminals”.
There was widespread chaos at UK ports two years ago as liners from China and the Far East arrived with goods after the first Covid lockdowns.
Simon Heaney, a supply chain researcher at Drewry, the maritime consultancy, said: “The fear is that you’ll have a sort of avalanche of ships and cargos coming out at the same time so you get massive loads of cargo coming all at the same time, which will once again overwhelm ports on the end of that and the origin point.
“Ports and the supply chain system in general were already severely under strain even before the lockdown so the concern is, this will push back the recovery period. What we don’t know is what will actually happen. Some ports are more relaxed than others.
“Demand for containerised goods is clearly waning, anyhow. There may not be such a backlog of orders in any case because other countries in Asia, such as Vietnam, were able to sort of take up some of that slack, while Shanghai was out of action.”
Mr Ballantyne said that supply chains were much better placed than two years ago, however.
With the lockdown in China being much shorter and the UK being open for business, if a protracted rail strike could be avoided, disruption could be kept to a minimum.
Nevertheless, he added: “It is fair to say that this time – in comparison with two years ago – our storage is in shorter supply. So there are a lot of things in storage in the UK. So we have less capacity to put things into storage.”