From Factory Shutdowns to Recovery: Navigating Logistics After Chinese New Year

At this time, the logistics landscape experiences significant shifts, impacting shipping delays, port congestion, increased costs, supply chain disruptions, and extended lead times. The weeks leading up to Chinese New Year witness a surge in demand for goods, accompanied by reduced shipping capacity due to factory shutdowns. This results in shipment delays, posing challenges for both businesses and logistics companies alike. Moreover, congestion at Chinese ports exacerbates these delays, creating bottlenecks in the movement of cargo containers, further hindering the timely delivery of products across international waters.

The heightened demand and limited capacity also contribute to increased shipping costs, creating a competitive environment for securing shipping space. Companies must navigate these challenges while managing their transportation budgets post-Chinese New Year. Additionally, disruptions in manufacturing, shipping, and logistics during the holiday period reverberate throughout the global supply chain, affecting businesses reliant on Chinese suppliers or manufacturers.

Strategic planning and close communication are key. To effectively mitigate these impacts, strategic planning is crucial. This involves proactive measures such as building up inventory, adjusting production schedules, and initiating transparent communication with suppliers and logistics partners well in advance. While the effects of Chinese New Year on global logistics are temporary, careful planning and management are necessary to minimise disruptions and ensure the smooth functioning of supply chains.

Following the conclusion of Chinese New Year festivities, a recovery period ensues, during which factories, shipping companies, and ports gradually resume operations at full capacity. Boy Kortekaas, Business Development Manager at Broekman Logistics, explains that is “essential to recognise that this recovery may take time, and residual delays may persist as the backlog of shipments and cargo containers clears. Clear communication and collaboration with our partners is of upmost importance during this period of time.”