US ports backlog taking its toll on HK businesses

HONG Kong exporters are encountering problems getting their products overseas in time for Christmas due to the unprecedented backlog at US ports, reports RTHK, citing the city's Legislative Council member, Jeffrey Lam.

The Business and Professionals Alliance lawmaker, who represents the commercial sector, said local firms have been struggling to hire shipping containers due to a shortage caused by a cargo surge in the US.

The ports of Los Angeles and Long Beach have been trying to deal with a backlog of container vessels that has built up due to an increase in demand and a lack of logistics workers.

"Christmas season merchandise does have its limitations. After Christmas, like Christmas trees, nobody's going to buy it," Lam said.

He pointed out that Hong Kong exporters could suffer from cash flow problems if they fail to deliver their products on time.

"Such as delayed payments, or buyers refusing to pay. If the buyers decide to cancel the order, then the Hong Kong company will be stuck with the merchandise," he explained.

"If it is pure Christmas merchandise, it will be stuck for one year, and then the next year, whether the Christmas merchandise will be in trend or not, that would be the question."

Mr Lam urged the government to relax rules related to air cargo, including being more flexible in allowing the re-purposing of passenger flights to carry goods instead.

"If we can allow more cargo airplanes to leave Hong Kong with loaded Hong Kong merchandise, that would help," he said.

He also called on the authorities to help mediate price negotiations, saying local businesses have been forking out ten times more than usual to hire shipping containers.

"The government can look into helping the SMEs. I'm not asking for rebates, but I'm asking them to give a container to those SMEs at a more reasonable price."

https://www.shippingazette.com/menu.asp?encode=eng

2021/10/25 17:46:47