China is the largest tire exporter in the world and its economy is dependent on the foreign revenue that they earn from exporting worldwide. The pandemic had a huge impact on China as trade was shut for several months.
China’s province Shandong is known as the tire and rubber hub. Most of the tires exported from China are manufactured there. As ports facing operations issues, the tire factories have limited their production and necessary precautions are taken by the manufacturers. In the current times, China again entering lockdown can cause a huge disturbance in the global supply chain.
China’s Shenzhen and Shanghai have entered lockdown and they have China’s two busiest ports. The increasing infection cases have caused public transport to shut down and staff at the ports is not available. To balance the situation extra shifts are being done in the southern ports of China and around 174 vessels are loading and anchored there.
The congestion started at the port of Shenzhen due to the lockdown in the country. This lockdown is causing delays in the shipments from China. The ports are currently short-staffed and this is creating a backlog in the shipments. Congestion in the Qingdao port has also increased and the vessels have been waiting there for three to five days because of the dense fog.
Conclusion
If the lockdown continues for more couple of weeks the global supply chain will be disrupted as only the shutdown of Shenzhen port has caused a 14% loss in the imports of Pedro Bay area import volumes in the US. A tire is the initial part of the vehicle and most of the tires are exported from China. This will create a shortage of tires in the global markets. Schedule your shipments and manage your inventory accordingly to avoid any kind of delays.
