The coronavirus outbreak continues to cause disruptions to the global supply chain. The ocean carriers are continuing to void sailings or cancel port calls to reduce space, trying to deal with a lack of China base port cargo. This is expected to continue through February and some are voiding sailings into early March. The voided sailings will be based around how quickly the factories can ramp up from a lack of available employees.

Flights between China and the U.S. on American Airlines, Delta Airlines and United Airlines have been canceled until the end of March, causing limitations in available air cargo space. Price increases should be anticipated due to a significant reduction in available space and strong demand as factories come back online.

Additionally, the Chinese government has been strictly controlling citizens’ return to work in factories, and only a small percentage of the workforce has been able to return to work as of mid-February. It is expected that the remainder of the workforce will return in early March.

Local trucking in China has been severely impacted as well. Several cities and provinces in China are requiring drivers to be quarantined for 14 days due to the coronavirus. This period must be met without any signs of illness before returning to work. Many drivers entered quarantine on or about February 10, 2020, the date the Chinese government first began to allow for workers to start quarantine. The expectation is that many will be allowed to return on February 24, 2020, barring additional illness.

The Chinese government is also limiting road access near factories to prevent the spread of the coronavirus epidemic. Many factory workers are awaiting permission from the government to access their workplaces. Government authorities are gradually granting access to roads and areas nearby.

We will provide you with additional updates as we receive them. If you have any questions or concerns, please contact our team.