Authorities in Shanghai imposed a strict lockdown on March 28 as Covid-19 cases rose, creating disruption to logistics activities.

Port of Shanghai

Districts on the eastern side of Shanghai are undergoing testing until April 1, at which point the western side will come under restrictions and be tested until April 5.

All local companies within the lockdown areas must conduct closed-door operations or allow staff to work from home. Public service companies, such as those dealing with water, electricity, fuel, gas, communication, transportation, meat and vegetable supplies, however, will continue to operate, according to Noatum Logistics.

The lockdown comes at a time when the port of Shanghai was already experiencing port congestion. Vivek Srivastava, senior trade analyst at VesselsValue, explained: “Authorities in Shanghai imposed a strict lockdown on Monday morning, following congestion at the city’s port skyrocketing since early March.

“With roads, bridges and tunnels between the Pudong and Puxi areas blocked for at least a week, Shanghai International Port Group, which manages the city’s ports, released a statement saying, other than in cases of extreme weather, 24 hour operations would be maintained. Data from VesselsValue shows an almost five fold increase in the number of ships waiting to load or discharge at Shanghai in the last two and half weeks.”

Congestion at Shanghai usually worsens at this time of year, Srivastava added, but the recent increase is far higher than both last year and normal seasonal levels. Broken down by ship type, the surge in congestion is driven by dry bulk carriers, followed by tankers.

“It is unclear what impact Shanghai’s lockdown will have on the port’s vessel queue, whether it will worsen the backlog or clear it. However, supply chain managers and analysts around the world will need to start planning for knock on effects,” said Srivastava.