India is dealing with the worst container equipment shortage in its documented history. The world’s most severe pandemic induced lockdown, combined with falling consumption, blank sailings, and shipping lines’ desire to reposition containers to more lucrative trades has created a severe short fall at all inland points and most ports.
India, a country of 1.3 billion people experienced the most debilitating COVID lockdown of any country. Malls and stores were closed for months and severe restrictions were placed on the movement of people and goods. This led to a 48% decline in imports into the country.
During the months of April through July, most Indian factories were shuttered, and migrant workers fled to their hometowns creating a slowdown in manufacturing. Ocean carriers decided to use this as an opportunity to reposition empty containers to the far east where they were experiencing a resurgence in freight revenues. As Indian factories emerged from their lockdowns and were asked to fulfill long pending export obligations, the inventory imbalance deepened.
Major steamship lines have unofficially claimed a shortage of between 100,000-150,000 TEUs across India. Blank sailings have ceased, but the container inventory shortage is causing freight rates to spike by as much as 40% with no expected relief in sight.
Federation of Indian Export Organizations (FIEO) has approached the Indian government for intervention. Sharad Saraf, the president of FIEO, in a statement to the JOC said, “Non-availability of containers for the export sector is posing a serious concern for meeting delivery commitments of foreign buyers. From the last couple of months, in spite of offering space for three to four weeks ahead, shipping lines are shutting out containers abruptly, giving reasons that the vessels are full.”
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