Port choke points an example of how virus snarls production, distribution of food
The port backlogs that have crippled food shipments around the world for weeks are not getting much better. In fact, in some places, they are getting worse.
In the Philippines, officials at a port that is a key entry point for rice said last week that the terminal is at risk of shutting as thousands of shipping containers pile up because lockdown measures are making them harder to clear.
Hubs like Singapore and Shanghai have halted crew transfers to prevent the spread of the virus.
Meanwhile, curfews in Guatemala and Honduras, known for their speciality coffees, are limiting operating hours at ports and slowing shipments.
In parts of Africa, which is heavily dependent on food imports, there are not enough workers showing up to help unload cargo.
The port choke points are just the latest example of how the virus is snarling food production and distribution across the globe.
Trucking bottlenecks, sick plant workers, export bans and panic buying have all contributed to why shoppers are seeing empty grocery store shelves, even as ample supplies are available.
Food moves from farm to table through a complicated web of interactions. So problems for even just a few ports can ripple through to create troubling slowdowns.
For example, wheat grown in Europe can be shipped off to India, where it is processed into naan bread for eventual export into the American market.
Disruptions along the way are causing heavy delays.
And there is the threat that things could get much worse if port problems spread. Just a handful of countries, for instance, export the bulk of the world’s rice and wheat, staple sources of calories.
Soya beans from South America help keep the planet’s livestock fed, and the vast majority of cocoa supplies are shipped out of a small section of West Africa.
Even countries like the United States, a key food exporter, depend on imports for things like wine, spices, cheese and out-of-season produce.
US frozen-foods company Saffron Road relies on Indian shipments for naan and other products.
A three-week lockdown on India’s 1.3 billion people has brought transportation of goods within its borders to a near halt, and the government sparked confusion when it told all major ports that the virus was a valid reason to halt some operations.
Saffron Road may be forced to look for other suppliers if the disruptions continue much longer, said chief executive officer Adnan Durrani. “It’s uncharted territory.”
Still, in some parts of the world earlier port disruptions have already improved. China is past the worst of its problems. At the height of the nation’s outbreak, thousands of containers of frozen pork, chicken and beef were piling up at major ports after transport disruptions and labour shortages slowed operations.
The logjam also created a dearth of containers elsewhere in the world, which was then compounded by the fact that vessels were not making trips out from the Asian nation with manufactured goods. Those issues have since cleared up as the country went back to work.
In Brazil, the world’s top exporter of soya beans, beef, coffee and sugar, shipments are now running at a normal pace amid a joint effort between the government and companies to keep shipping flowing.
A.P. Moller-Maersk, the world’s largest handler of refrigerated containers, is taking 1,800 empty units to the South American nation to counter a shortfall for Brazil’s meat shipments.
Containers are scarce in Brazil after being used for refrigerated stockpiles amid congestion in China’s key ports during the Asian nation’s lockdown, Maersk said.
Brazil also managed to export record volumes of soya beans last month after the government intervened to stop a strike threatened by port workers who were worried about their safety.
“Brazil’s export volumes are so big that any minor issue must be solved very quickly. Otherwise, it may lead to logistic bottlenecks in all the world,” said Mr Sergio Mendes, head of the nation’s grain export group known as Anec.
But with the disease spreading, container issues are popping up in other regions. The sturdy boxes, often made of steel and usually measuring somewhere between 6m and 15m in length, are constantly sent back and forth across the planet with goods.
That flow has been heavily disrupted as the virus slows manufacturing and cripples demand for some products. The Port of Los Angeles, for example, saw a 31 per cent drop in volume last month compared with a year ago as retailers scaled back orders.
Food exporters are being forced to wait longer for incoming shipments to be able to empty and refill vessels with their goods. That is the case in Europe, where operations are running more or less normally, but the container squeeze is causing delays, according to Mr Philippe Binard, general delegate of Freshfel Europe, a produce association.
It is also a problem in Canada after some shipping routes were cancelled by carriers because of lower demand for manufactured goods.
“The outbound capacity is really starting to diminish,” said Mr Mark Hemmes, president of the Edmonton, Alberta-based Quorum Corp, a company hired by the federal government to monitor Canada’s grain transportation system.
In Nigeria, the problem is too many containers, which are piling up and clogging the ports. Workers who would normally be clearing the congestion are facing difficulties coming in as the nation’s lockdown shut public transportation. Banks near the ports are closing, making it harder to process receipts and clearing documents.
With food stuck in containers floating at the docks, it is exacerbating shortages and driving up prices.
“The ports are jam-packed,” said Mr Tony Nwabunike, president of the Association of Nigerian Licensed Customs Agents.
“Even (for) those of us who have been given orders to go to the ports as essential service providers, we are not accessing the ports because transportation remains skeletal,” Mr Nwabunike said, adding that not all workers have the necessary paperwork to show they are essential employees.
Bloomberg
