According to news from the New Indian Express, there are 1,000 to 1,200 containers of shrimp exported from India that are now stranded in the Chinese ports. The reason is China suspects coronavirus traces on the outer packaging of the frozen shrimp exported from India. Each of these containers, on average, has 16 tons of frozen shrimp.
These exports belong to 50 seafood export companies from the country, and of them, 25 are from Andhra Pradesh. Since the beginning of June, 31 Indian seafood companies have been denied import declarations-mainly selling vannamei. According to customs, the suspension of these companies will last from one to nine weeks.
All of us are curious why this could happen? Why are so many containers stranded in the Chinese ports? Can we still export to China under this situation? Ocean Treasure did research, and here is what we found and what we can see in the future.
Due to the Chinese customs policy, all the frozen products will have the acid test.
China has suspended all 50 companies. In other words, they have been blacklisted. After China stated that the COVID-19 incident was detected on shrimp packaging, their license to export to China was suspended. These containers being tested as positive will stay at the border and wait to send back. In July alone, 23 companies were suspended from imports, and the resumption time is unknown. So for the container number, if you have one container tested positive, you will have 1-2 weeks suspension. We can see these 1000 containers are unlike to be all positive containers.
So why there are that many containers stranded ? The answer is the Zhanjiang Port.
From June 20, the Zhanjiang port paused the importing of 11 countries till July 15. This made the transition a mess. And also, Zhanjiang is one of the biggest ports for the vannamei importing. Many containers have to transfer to other countries, and also, because of the low efficiency before in Zhanjiang port, many containers are already stranded there. This might be the key point why there are so many containers stranded in China.
Recent customs situation
After we check the situation of the customs, here is what Ocean Treasure found out.
Zhanjiang and Tianjin are the two main ports for the vannamei containers.
- For Tianjin port,
The whole clearance process is about ten workdays. Then the container will place into the first-level cold storage for sterilization and nucleic acid test. After getting the quarantine certificate, nucleic acid certificate, and disinfection certificate, we can get the container. So the whole process might be 15 workdays.
- For Zhanjiang port
There is another story. Even though we know now all the containers from the listed 11 countries can ship to Zhanjiang port. However, the terminal restricts the delivery volume of containers from these 11 countries, and only 20 containers are allowed to be picked up at the terminal every day. Also, the clearance and acid test process will be around 3 weeks, and then the container will place into the first-level cold storage for sterilization. There will be another 3 weeks. So for Zhanjiang port, the whole process will be at least six weeks. In addition, there are still many containers stranded in the port, and this will at least take one month to clear these stranded containers.
There is another issue for the situation in China
These days, there are some Covid 19 in Nanjing, and in just one day, there are 48 cases in Nanjing on the 27th of July. And this could alert the customs to set more strict inspections processes for the import containers, especially from the South of China.
What should the exporters of India do?
The demand for China is still very huge, and Tianjin port still has excellent efficiency. In Zhanjiang port, the clearance charges for each container range from 8000USD to 12500USD (depending on the different demurrage standards for different liners). But in early 2021, it only cost 1500USD-2500USD. So, the importer at least pays 5500 USD more for each container.
According to this, so importers will choose to go to Tianjin because of the efficiency, and the cost of the inland transportation is less than 5500 USD per container. That could be an idea for the exporters from India to suggest for your importers, and also the payment term will be shorter, and our exporters can get the payment faster.
For these importers who insist on shipping to Zhanjiang port, we suggest our exporters think carefully before confirming the order; maybe the payment will delay for very long.