The problems created by the Covid pandemic to the carriage and distribution of goods caught everyone including the major container carriers unaware and necessitated the introduction of short term measures in order to safeguard both the coherence of the logistical cycle as well as the financial sustainability of the carriers. The situation that evolved between March and June saw a plummeting of cargo volumes and an unprecedented situation of port closures (mainly in China) which left the carriers grappling at situations never experienced before and which needed immediate solutions.
The economic downturn in China as a result of the curtailment in manufacturing and exportation had an immediate effect on the amount of cargo available for export from Far East to the rest of the world. As early as March, the UN had already published a study wherein it estimated that China’s reduced exports cost other countries and their industries over USD 50 billion. The regions most effected in order of priority were the European Union, the United States, Japan, South Korea, Taiwan and Vietnam.
The recovery in Chinese exports during the summer months was immediately counterbalanced by the drop in demand particularly in Europe as a result of lockdown measures introduced in the various European countries. Hence the problem shifted from supply to demand but the net result was the same – less seaborne cargo to be carried.