NOVEL CORONAVIRUS UPDATE - Date : Feb 26th, 2020 - Yusen Logistics
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NOVEL CORONAVIRUS UPDATE Date : Feb 26th, 2020
H i g h l i g h t s – F e b 2 6 th
China – foreign funded firms resume production
▪ Foreign-funded enterprises have resumed production amid epidemic control efforts in different parts of China with the
confidence that the country can win the battle against COVID-19.
▪ The commercial authorities of Hebei province have been promoting orderly production resumption for foreign-funded
enterprises while strengthening efforts on epidemic prevention and control during the fight against the novel coronavirus
disease.
▪ Many foreign enterprises including Nestle, Louis Dreyfus Company and Trelleborg Wheel System have resumed production
with the safety of staff guaranteed to deliver their confidence in the rapid recovery of the Chinese economy.
▪ Monetary authorities will also provide special credit quotas for private, small and micro companies impacted by the virus
outbreak. The central bank governor urged financial institutions to "appropriately reduce interest on loans for small and
micro enterprises" to prevent capital chain ruptures.
▪ Foreign exchange regulations will be streamlined further to facilitate cross-border trade and investment and support
economic development, coronavirus epidemic control efforts, the country's top foreign exchange regulator said on
Tuesday.
Source : http://www.chinadaily.com.cn/a/202002/26/WS5e55ad03a31012821727a489.html
27 February 2020 Copyright © 2020 Yusen Logistics. All rights reserved 2H i g h l i g h t s – F e b 2 6 th
Vietnam – cross border trade with China
▪ Agricultural products are in priority to release
▪ Due to lack of workers, the truck releasing efficiency is very low
▪ Approximately 700 trucks are pending to release, Lang son is the most dense border gate.
▪ Timeline as below
▪ Feb 20 to 22 : start to open border gate (with low volume of truck and focus to agriculture food)
▪ Feb 23 to 25 : open border gate as normal (all type of goods) but the truck release capacity is very low due to lack of labours
▪ Feb 26 : open as normal but very congested at the borders
▪ Border gate is opened as normal with some conditions as below
▪ Driver no need to isolate after comeback from border but he/she must be in personal-protective-equipment when cross border gate
▪ Pre-register with Custom House (advance information submitted)
▪ Required wearing face masks and wearing protective gears before crossing the border, no quarantine up to now.
Source: https://www.moit.gov.vn/web/guest/tin-chi-tiet/-/chi-tiet/thong-quan-hang-hoa-ngay-thu-2-tai-cua-khau-tan-thanh-lang-son-van-rat-cham-%C4%91en-chieu-ngay-21-02-2020-chi-xuat-khau-%C4%91uoc-26-xe-17905-22.html
27 February 2020 Copyright © 2020 Yusen Logistics. All rights reserved 3H i g h l i g h t s – F e b 2 6 th
South Korea – people work from home
▪ Many major companies are letting their employees work from home or have flexible working hours after the government
raised the alert level to “serious” and the number of cases here surged. The nation’s largest conglomerate Samsung Group
decided Monday to allow pregnant employees to work from home and delivered the information to each affiliate through
its personnel teams.
▪ Also, e-commerce firms, including Coupang, WeMakePrice and Tmon, and global software firms, such as Intel, Dell and
Microsoft, have all advised their employees to work from home. The Korea Chamber of Commerce and Industry
recommended about 180,000 member companies to work at home to prevent the virus spread, mostly when people use
public transportation.
▪ A few countries have started to impose bans on travelers coming from South Korea’s regions most affected by the virus
outbreak.
• Japan : government has begun working to bar foreign nationals from the southern areas of South Korea
• Philippines : they have barred travelers from South Korea’s North Gyeongsang province from entering its country
• Vietnam : it has banned tourists from virus-hit areas of South Korea
• Singapore : it would ban all visitors who have recently traveled to Daegu, a city in South Korea where many cases have been reported.
Source : https://www.cnbc.com/2020/02/26/coronavirus-latest-updates-asia-stocks.html
27 February 2020 Copyright © 2020 Yusen Logistics. All rights reserved 4H i g h l i g h t s – F e b 2 6 th
Italy – coronavirus affect Italy’s wealthy regions
▪ Economic impact of the coronavirus outbreak in northern Italy’s Lombardy region became alarmingly clear.
Whether it’s supply disruptions, production halts or clients steering clear of Lombardy, businesses in Italy’s
economic heartland are counting the rising cost of the spread of the virus in a country that was already
teetering on the brink of recession.
▪ As the number of people infected by the virus in Italy rises above 300 -- mostly in the rich, industrial north --
restrictions imposed to stem its spread are threatening deeper economic woes. About a third of Italy’s output
comes from Lombardy and Veneto, the two most-hit regions that are home to 1.1 million very small businesses
with fewer than nine employees.
▪ The European Union is not planning to suspend the Schengen
▪ Agreement, not even partially, despite the Coronavirus
▪ outbreak all over Europe now. The borders between Italy
▪ and other European countries are still opened.
▪ Many large companies have asked employees to work
▪ from home and cut back on business travel. With people
▪ staying home, a whole slew of ancillary businesses are
▪ taking a hit -- from restaurants, bars and cafes to car services.
Source : https://finance.yahoo.com/news/coronavirus-piles-more-woes-business-050000952.html
5Restrictions of Vessels from China ▪ US Non-passenger vessels are allowed to operate in the US with restrictions if they have been to China or embarked passengers in China within the last 14 days under the condition that there are no sick crewmembers. Any vessels with sick crewmembers are required to notify the nearest Coast Guard Captain of the Port. ▪ Australia Any vessels that have left China or transited through the country after 01 February and less than 14 days prior to the date will be required to meet coronavirus requirements set by the government. ▪ Vietnam All Crews on those vessels not ever called Chinese ports, but have Chinese Nationality & signed on board around 14 days are also not allowed to go onshore when calling ports. Current process of quarantine takes 1 to 2 hours, thus ETA of vessel will not be impacted and carrier will not revise ETA on their arrival notice as initial sending. ▪ Singapore Maritime and Port Authority of Singapore (MPA) has implemented temperature screening at all sea checkpoints. Visitors having a travel history in Hubei or possessing PRC passports issued in Hubei, will not be allowed to enter or transit through Singapore. ▪ Turkey Cargo ships have been permitted to dock although they will undergo strict inspections. 27 February 2020 Copyright © 2020 Yusen Logistics. All rights reserved 6
Restrictions of Vessels from China ▪ Indonesia Vessels that have visited China during their last 10 port stops will be thoroughly inspected by the Port Health Authority. Anyone suspected of being infected with the virus must be treated by authorities. ▪ Philippines The Philippine Ports Authority said workers in ships coming from China are prohibited from disembarking to prevent the spread of the virus. ▪ South Korea Any vessel that visited China within the last 14 days will be inspected by officials from the Korea Centres for Disease Control and Prevention agency before entering. The vessels can only enter South Korean ports if the inspectors find no sign of infection and give them the all-clear. ▪ Kenya There will be an increase of vessels’ docking time at the port, as Kenya Ports Authority (KPA) screen all crew members for the virus and inspect all vessels entering their ports. 27 February 2020 Copyright © 2020 Yusen Logistics. All rights reserved 7
Yusen Logistics Operation
Yusen China offices
▪ From Feb 24th onward, total 67 staffs (around one-third of SCS staff in China) will work at office
▪ Work-from-home or remote office will still be the dominant mode
▪ No disruption of operation
▪ Communication via e-mail, conference call or chat group
Yusen Italy and South Korea
▪ No disruption in operation is reported
Yusen HKG Control Tower (CTO)
▪ Starting from Feb 17th, HK CTO exercises alternative shifts at office, i.e. around 50% of the staff are worked
from home, while another 50% are worked at the office.
▪ No disruption of operation & communication
27 February 2020 Copyright © 2020 Yusen Logistics. All rights reserved 8Yusen Logistics Operation:CFS,Trucking,Carriers
Origin Warehouse Truck Carrier Terminal
Resume normal business operation on
Feb.10th, most carrier will arrange home
Trucking service is still limited in supply, but
Dalian Normal operation work for certain period, not sure the actual Terminal as normal
gradually resume to normal.
date; Official announce Office to open on
Feb.10th.
Trucking service is still limited in supply, but Resume normal business operation on
Fuzhou Normal operation Terminals as normal
gradually resume to normal. Feb.10th; Office to open on Feb 10th.
1. COSCO NKG will be back to normal work
on Feb.3rd in office; 2. PIL and WHL are
Opened on Feb 21st, subject to availability of labor Trucking service is still limited in supply, but still waiting for further notice
Nanjing Terminals as normal
resource gradually resume to normal. 3. Others will resume normal business on
Feb.3rd at home, offices will be open on
Feb.10th
Trucks from all cities of China are allowed for entry,
only if drivers can pass the health check and stay in
Trucks from all over China are accepted, on the
their vehicles. MSK resume work on Mar.1st;
condition that the drivers can pass the health
Ningbo 1. Ningbo National Logistics – Mon to Sun 08:30 CMA/APL/HPL/ONE resume to work on Terminals as normal
check and stay in the vehicle during the entire
until 20:00 Feb.17th; Others still remain the same
operation process.
2. Ningbo Port Southeast Logistics – Mon to Sun
08:00 until 2:00
1. CMA/ONE will implement home office
mainly plus office on duty
Trucking service is still limited in supply, but 2. MSK announced all staff work at home
Qingdao Normal operation Terminals as normal
gradually resume to normal. until the end of Feb
3. Others carriers are home-office in
majority
EED & DFJF (located in Linggang) are resumed to
normal operation. Except from Hubei province,
Trucking service is still limited in supply, but All carriers will arrange on-duty staff to
Shanghai trucks from all over China are accepted, drivers are Terminals as normal
gradually resume to normal. ensure operation before Feb.10th
subject to health checked and limited in assigned
operation area.
27 February 2020 Copyright © 2020 Yusen Logistics. All rights reserved 9Yusen Logistics Operation:CFS,Trucking,Carriers
Origin Warehouse Truck Carrier Terminal
The time of resuming normal business
Warehouse operation is normal, 1 day reservation Trucking service is still limited in supply, but
Tianjin operation to be pending, most carrier will Terminals as normal
in advance is needed. gradually resume to normal.
arrange home work from Feb.3rd.
Resume to work NO earlier than Mar 10th Most of the main carriers are resumed in
Wuhan Resume to work NO earlier than Mar 10th 24:00 On duty staff arranged
24:00 form of work-from-home since Feb 3rd
MSK resume work on Mar.1st;
Trucking service is still limited in supply, but
Xiamen Normal operation CMA/APL/HPL/ONE resume to work on Terminals as normal
gradually resume to normal.
Feb.17th; Others still remain the same
1. Gradually resume to normal operation;
2. Cross cities transportation to Shenzhen :
need to pre-register and people need to Since Feb 10, carriers are either on shift
Shenzhen Normal operation Terminals as normal
undergo health check before entering into duty, or work from home
Shenzhen city. No major disruption as long as
conditions are fulfilled.
Normal in operation, with both work at
Italy Normal operation Normal operation Terminals as normal
office and work from home
South Korea Normal operation Normal operation Normal in operation Terminals as normal
** Updated in red
27 February 2020 Copyright © 2020 Yusen Logistics. All rights reserved 10Market Update Airfreight
Sea-Air mode
▪ A solutions could help shippers to avoid airfreight shortages and price spikes as production lines in China soon get
back underway.
▪ Ocean transport to move the goods to a transshipment point, before flying to destination, could prove attractive
for semi-urgent shipments that want to avoid any airfreight price surges or space shortages, but can’t afford to
wait for long before arrival to the consumption markets .
▪ Singapore is around 10 days quicker than the traditional air-sea hub of Dubai, adding value and speed.
Shortage of capacity
▪ About 70 airlines have canceled all international flights to mainland China, and an additional 50 have curtailed
operations, resulting in an 80% reduction in foreign airline capacity and a 40% reduction by Chinese airlines.
▪ American Airlines, and United Airlines suspended service to China and Hong Kong until late April, while Air
Canada, British Airways and Finnair extended flight suspensions to mainland China until late March and cut more
flights to Hong Kong.
27 February 2020 Copyright © 2020 Yusen Logistics. All rights reserved 11Potential Impact To be Considered
Production Space and Equipment
▪ Late opening of factories may result to manufacturing and ▪ Slow booking release or response from carrier as work from
delivery delays. home or booking agent team not in full force.
▪ Parts and material packaging availability severely impacted ▪ Port congestion.
within the lockdown cities. Not all establishments and
authorities are officially open. ▪ Container rollovers and possible delay.
▪ Workers shortage as returning workers may be restricted and ▪ Tight vessel space and equipment availability could be
subject to 14 days quarantine. Public transportation is also expected once production resumes normal as cargo readiness
limited. are all at the same time.
▪ Limited air cargo space due to suspended flights.
Transportation
▪ Intercity transportation might be limited due to entry and exit ▪ More blanked sailings and increased freight rates
measures implemented by various cities
▪ Inland transit time could be longer due to road blocks and
checkpoints.
▪ Possible drivers shortage and truck supply.
▪ In some provinces, barge and feeder operation has been
suspended. Trucking service is very difficult to arrange and
therefore significant price increase is expected.
Copyright © 2020 Yusen Logistics. All rights reserved 1227 February 2020 13
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