Global cargo logjam deepens, delaying goods bound for retailers,
automakers
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[December 23, 2020] By
Lisa Baertlein and Jonathan Saul
LOS ANGELES/LONDON (Reuters) - Amazon
seller Bernie Thompson shifted half of his production out of China to
reduce his business risks and still found himself in the crosshairs of
logistical chaos besetting the movement of goods around the globe.
A surge in demand for furniture, exercise equipment and other goods for
shoppers sheltering at home in a worsening COVID-19 pandemic has upended
normal trade flows.
That has stranded empty cargo containers in the wrong places, spawning
bottlenecks that now stretch from factories to seaports. Container ship
operators ferry the majority of consumer goods, and transportation and
trade sources warn that prolonged industry disruption could cause
shortages and complicate the global economic recovery.
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Thompson, founder of Washington-based Plugable Technologies, sells
work-from-home staples like laptop docking stations. He diversified
sourcing to be less reliant on a single country for manufacturing and
less exposed to U.S. tariffs on Chinese goods.
Things did not go as planned and now, like many other importers, he is
concerned about keeping enough product in stock. "We've moved production
out of China and moved ourselves right into a disadvantage," said
Thompson.
His new factory in Thailand was first to suffer delays of about four
weeks, in part because shipping companies routed empty containers to the
top priority U.S.-China trade lane.
Those logistical snags cascaded and now his remaining shipments from
China - the world's No. 1 manufacturer – are postponed by as much as
three weeks. And he is not alone - U.S. retailer Costco Wholesale Corp
and Honda Motor Co Ltd in the United Kingdom have also suffered delays.
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![](../images/122320PIX/busine43.jpg)
A worker drives a truck carrying a container at a logistics center
near Tianjin port, in Tianjin, China December 12, 2019. REUTERS/Yilei
Sun
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"Everyone's trying to squeeze through this narrow opening all at once," said
Rick Woldenberg, chief executive of Illinois-based Learning Resources which
supplies educational toys to Amazon.com and other major retailers. It can
"really screw up your plans," he said. Container ships have been sailing at full
load since August – something that has not happened in a decade, said Peter
Sand, chief shipping analyst with trade association BIMCO.
Rolf Habben Jansen, chief executive of Germany's Hapag-Lloyd, told investors
that the container line was "deploying every available ship". MOUNTING
FRUSTRATION Frustration is building. Importers and exporters are "upset they're
not able to move their product or crop as willingly as they would like to," said
Gene Seroka, executive director of Port of Los Angeles – the busiest U.S.
seaport. "We need to get the trade flow going to grease the engine for the whole
world economy," said Christopher Tang, a business professor at the University of
California-Los Angeles. Port staffing reductions due to COVID safety rules also
play a part.
"It's a combination of strong volume and slower and less efficient operations,"
said Lars Mikael Jensen, head of network with Denmark's A.P. Moller Maersk, the
world's biggest container line. "This is the perfect storm for global container
flows,” Jensen said.
![](http://archives.lincolndailynews.com/2020/Dec/23/images/ads/current/charrons_bch041713.png)
(Reporting by Lisa Baertlein in Los Angeles and and Jonathan Saul in London;
Editing by Lisa Shumaker)
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