As of the writing of this blog, all 50 states in the US have started to reopen following more than a month of lockdowns. The story in other countries is similar. However, we are still feeling the effects of six-plus weeks of closures. The question now—and into the future—is: How do COVID-19 restrictions affect shipping?
It’s important to note that the shipping industry was one of the first hit with significant restrictions. The reason is that, throughout history, a number of diseases have spread courtesy of global shipping networks and transportation. It’s no wonder, then, that health officials would look to curb one of the virus’ biggest routes for reaching new pockets of the world.
How COVID-19 Restrictions Affect Shipping
When nearly 80% of trade is carried by sea, COVID-19 restrictions affect shipping on a global scale. Key ports have imposed restrictions on vessels and crew. That means that not only are carriers stuck at port, but the people working on them may be as well. Or, on the flip side, those crews may be forced to shelter in place at home and unable to get to work.
To combat these limitations, sailings to ports with restrictions on crew changes have dropped nearly 20% compared to previous years.
All of this means there are two big issues in play here:
- Changes in the global supply chain.
- Mental health issues for crew.
Seatrade Maritime News touches on the second point: “…This pandemic has been a wake-up call in relation to their [seafarers] working conditions.”
It’s not just about how COVID-19 restrictions affect shipping; it’s about how they affect people as well.
Reduced Purchases = Reduced Needs
The people who are not working on carriers are the consumers. And while under restrictions and lockdowns, they have continued to purchase essential items, much of their additional spending has obviously been reduced. Unfortunately, that translates to a corresponding reduction in shipments.
According to Maersk, one of the largest global shipping companies, they are canceling dozens of sailings as they expect container volumes to drop 25% this quarter. Naturally, the company notes a lowered demand in consumer and industrial markets.
One of the big issues in how COVID-19 restrictions affect shipping relates to the fact that fewer people are venturing out—restrictions or not. Slate queried 6,000 Americans about their comfort levels of reentering the world, and the vast majority answered no, they were not ready to leave home—to myriad scenarios. The only overwhelming yes answers came in response to the questions regarding going to a doctor’s office for a routine checkup, voting in person, or going to a beach or national park. But when it comes to entertainment or socializing, those asked gave a resounding no.
And with fewer people venturing out due to fear or mandates, it’s easy to see how COVID-19 restrictions affect shipping.
Questions about How Restrictions May Affect Your Industry?
At Cyclone Shipping, we always stay not one but many steps ahead of what is going on in the shipping industry. While we can’t predict the future, we are constantly assessing the situation and looking for alternatives to ensure our clients’ products are able to be shipped in a timely manner.
If you have questions about how COVID-19 restrictions affect shipping and your business, we invite you to contact us.