Chinese New Year 2019, year of the Pig. The twelfth Zodiac and a sign of wealth for the coming year. Chinese New Year (CNY) begins February 5th with the Spring Festival and runs eleven days through the 15th. During CNY, businesses close, workers return to their homes and spend time in celebration, not only in China, but throughout greater Asia.
During CNY annually, we see a complete suspension of vessel movement in and out of Asia. We will witness a consistent decline in sailings and capacity leading up to CNY, a full suspension of sailings for 1-2 weeks during CNY, and finally a slow progression back to usual capacity as CNY comes to an end.
Importers and exporters must pay close attention to dates, sailings and overall impact to supply chains. In 2019, we have an additional complication to consider. Tariffs slated for implementation on January 1, 2019 – commonly referred to as List 3 – were delayed. These tariff changes raising rates from 10% to 25% on much of Chinese manufactured goods are now scheduled to become effective March 1, 2019 notwithstanding further suspension from the U.S. Trade Office. List 3 can be found here: https://ustr.gov/sites/default/files/enforcement/301Investigations/Tariff%20List-09.17.18.pdf
The import market may see a strong surge of cargo not only due to factory closures, but also because a strong need land goods in the United States before the 25% tariff adjustment takes place. For east coast trade, this means final departures from China must occur before or by the end of January. For west coast lanes, the rush will coincide due to CNY sailing suspensions, whereas otherwise, west coast cargo could have planned departures in mid-February. Because of CNY, that will be very difficult. Overall, nearly all US bound cargo leaving China will have to depart by the end of January in order to avoid the potential of higher duty rates upon arrival.