Omikron just another hit to China-Europe supply chain
The rapidly spreading Omikron mutation of the coronavirus could trigger a boom in sick staff. The international trade union International Transport Workers’ Federation (ITF) is already speaking of an ‘Omikron crew crunch’ for the shipping sector, while China’s zero tolerance policy in battling the coronavirus could lead to new closures of factories and ports.
In the past two weeks there have been limited local restrictions in Shanghai and Ningbo due to corona cases in China, which were certainly not as rigorous as, for example, the weeks-long closure of a container terminal in Ningbo this summer. However, shipping expert Lars Jensen of consultant Vespucci Maritime warns that the risk of new port closures is currently high. “There is a high risk of a major impact from an Omokron wave in China, and we expect a lot more turbulence in the supply chain.”
Although rail freight lines are not directly affected, the industry is not immune to the impact that port closures have on the supply chain. Large ports on the east coast of China are especially relevant nodes on the New Silk Road, as transhipments hubs between sea and land transport. Moreover, factories in these regions are likely to close their doors, slowing down production.
Infections in Chinese province of Zhejiang
Zhejiang, the Chinese province of which Ningbo is the major port, counted several hundred corona infections this week, which is significant by Chinese standards. Authorities warned that the virus appears to be spreading relatively quickly and in response, several factories in the province have closed their doors, including a battery producer and a pharmaceutical company.
In the fight against the impending danger, the ITF has drawn up its own list of recognised quarantine facilities (hotels) together with the International Chamber of Shipping (ICS). This is to ensure, according to the ITF, that seafarers can board ships safely despite unpredictable changes in government border policies.