Container shortage in India is causing long delays for Exporters, especially on US trades

The operational impact from the creeping equipment shortage in Asia – dominant headhaul traffic has caused empties to pile-up at ports in the US and Australia earlier this month, prompting carriers to plead for the swift return of used import boxes.

The shortage is most critical at Inland Container Depots

According to New Jersey-based Worldwide Logistics (WL), the equipment shortage has spread to India, partly due to a drop in import volumes from China after trade restrictions were imposed by the government. “The shortage is most critical at Inland Container Depots (ICD) but also evident at port-side locations,” the forwarder noted.

“Cargo volume from India to the US is extremely strong, as US importers look to replenish inventory depleted during the shutdown period in India, in response to Covid-19.”

WL said most direct and transhipment services to the US east and west coasts from the major gateway ports of Nhava Sheva (Mumbai) and Mundra were impacted, with transhipment further exacerbated by the tight space from Asian transhipment hubs.

Limited new container manufacturing in India

“There is limited new container manufacturing in India which would otherwise serve to alleviate some of this pressure.

As a result, WL said carriers had begun to offer guaranteed space surcharges of US$750 per container, similar to the ‘no-roll’ premiums found on the deepsea trades over the past couple of months.

Pharmaceutical companies have to wait almost two weeks to get bookings for US ports

Rakesh Pandit, CEO of Conbox Logistics, told a shipping “There is waiting period to get bookings and containers for one or two weeks on certain sectors, such as pharmaceutical companies who have to wait almost two weeks to get bookings for US ports.

“Shipments planned in large volumes like marble, rice and other agro commodities are also getting delayed,” he added..

Lack of government support for exporters

There was a lack of government support for exporters rocked by lockdowns. “Exporters are finding it hard to execute orders due to a lack of government support in the form of stimulus or financial aid ” he claimed.

Container volumes in Indian ports between April and August this year plummeted by 25 per cent on  a year on year to 3.2 Million TEUs  according to Indian Port Association.   
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