Concern about supply chain disruptions triggered by the Lunar New Year holiday that began yesterday is running higher this year than last, according to a survey from the German container logistics platform Container xChange.
Seventy-three percent of supply chain professionals expect the event, which also known as Chinese New Year, to further disrupt the shipping industry this year, as opposed to 66% who said the same thing in 2022.
Specifically, most respondents said the impacts they expect will include “an increase in port congestions and delays” and “delayed container journeys” soon after China reopens. That contrasts with last year’s survey results, when most industry professionals feared capacity issues and higher rates as the holiday’s aftermath.
The Lunar New Year celebration spans countries and cultures throughout Asia, but may have its biggest business impact in China because of that nation’s stature as a global manufacturing center. During the 15-day holiday, so many people travel to spend time with their families that many factories and logistics facilities are forced to slow down or shut their doors entirely.
That effect may be multiplied further in 2023 due to China’s recent decision to lift its harsh “Zero covid” isolation and quarantine rules, freeing citizens to travel again to celebrate the “Year of the Rabbit” after years in lockdown.
“There are added, and new complexities ahead coupled with Chinese New Year where at one end we see China coping with the Covid infections, and on the other end we see a continued dip in demand,” Christian Roeloffs, cofounder and CEO of Container xChange, said in a release. “We cannot see Chinese New Year in isolation but in combination with all these challenges. The biggest concern is the reduced production and port capacity due to the infections in China. Also, the rates are low, capacity management is still a top priority for carriers and blank sailings are prominent. Amidst this, in the coming weeks, we foresee prolonged factory closures and bearish market conditions.”
The firm’s annual survey included replies from 2,300 respondents, including both freight forwarders and supply chain professionals in general.