Finding the right coping mechanisms

There is the issue of the economic impact on the industrial production in Japan with insufficient electricity and factory shutdowns. The automotive industry particularly, but also the high tech components sector have been hit hard.

There is much discussion in the media about the cascading impact on business in Europe and North America. Most likely many of the problems will be in the short term until alternative sources for goods and products can be found.

Japan exports some 600,000 teu annually to the US and an estimated 500,000 teu to Europe. That equates to under 12,000 and 10,000 teu respectively per week. Even with a 30% reduction on an annual basis the impact for carriers and ports is marginal, as it represents a loss of approximately 1% of the trade on an annual basis.

The bigger issue relates to the trades operations. It has been reported that the debris carried back out to sea by the tsunami is interfering with shipping in the trades lanes into the ports. Added to that is the fear of radiation. Some carriers cancelled calls in Tokyo but that trend is reversing with services returning despite the confusion about the levels of radiation.

China turned away an MOL ship, claiming that it was emitting radiation levels that were not considered safe. APL began scanning export containers from Yokohama from April 6^th, estimating that would be some 200 containers daily. Carriers also refused bookings from the radiation affected region.

In the US, Los Angeles and Oakland begun scanning containers for radiation soon after, closely followed by European ports, but in an uncertain world with so many unknowns, the responses to the crisis have been slow to emerge.

What we can learn from all of this is that the port industry is probably the best suited for responding to this situation with actions being taken to minimise the impact of potential disruptions to trade.