UPDATE: Coronavirus Impact on Trade and Transportation with China

In many parts of China, businesses were scheduled to resume work this past Monday, 2/10/2020, but a variety of data indicates progress has been slow as the virus remains an unresolved concern. The lockdown measures, together with the substantial extension of the Lunar New Year holiday, have significantly delayed resumption of business and production. Even though a significant share of China’s manufacturing plants have resumed operation this week, many plants are still operating at far below capacity due to labor force shortages.

While all businesses are eager to reopen, they must first meet government virus control guidelines and the schedule of the return of workers must be approved by the Virus Control Unit of the local governments. Currently, the Virus Control Units are overwhelmed with return to work applications, delaying a timely return and forcing many companies to maintain staff working from home or work with skeleton crews. A mandatory 14 days quarantine period has been implemented for non-local workers to comply with the return to work guidelines, which will also impact many industries. For some companies, it means that many of their staff coming back to their city of work, from outside regions, will not be able to return on time. Further quarantine for those impacted suggests a more likely return date ranging from February 17th to March 1st.

As reported earlier, trucking shortage will be the biggest challenge to returning to a normal flow of cargo, especially as transportation restrictions remain in effect. Chinese Ports and warehouses continue to remain functional as they have for weeks, but will be directly impacted by the trucking shortage, as well as the staggered flow of returning workers. Steamship lines continue to plan “void sailings” to cope with the low volumes and poor demand due to the extended holiday and quarantines. The shortage of truck drivers will also slow the efforts and normal flow of moving containers to and from the factories, warehouses and the container ports.

Schreiber Foods International, Inc., continues monitoring the situation in China and wants to assure their customers that our food products imported from China are safe to consume. According to the Center of Disease Control (CDC), “coronaviruses are generally thought to be spread most often by respiratory droplets. Currently there is no evidence to support transmission of 2019-nCoV associated with imported goods and there have not been any cases of 2019-nCoV in the United States associated with imported goods. Information will be provided on the 2019 Novel Coronavirus website as it becomes available.”