The End Of The Recession? The View From Qingdao.
Just received this email from co-blogger Steve Dickinson:
I do my martial arts workout three mornings a week at the beach here in Qingdao. We have a great view of the entrance to the Qingdao port complex. Vessels intending to use the port must "park" for a while as they wait for a berth. For most of the summer, we would regularly see no more than five or six vessels parked and waiting. This Monday, I counted 23 vessels waiting for a berth. This means that the port is entirely backed up and there is simply no room for the vessels. This suggests that activity at the Qingdao port has suddenly increased, leading to a delay in shipments. The Qingdao port is the second largest container port in China. Its capacity is enormous and it is unusual for the port to back up in this way. This suggests that shipments out of China have suddenly increased in the past several weeks.
What are you seeing out there?
Comments (14)
Read through and enter the discussion by using the form at the endShawn in Melbourne - September 7, 2009 2:50 AM
Hi Dan,
Hope all is well.
Anyway, would be curious to see how the back-up unfolds over the coming days and whether this might just be a logistical issue (not enough resources, human or machine or both, online to handle extra capacity, etc.).
Hopefully it is a sign of an improving economy...
Cheers,
Shawn
Qingdaoist - September 7, 2009 3:18 AM
Its always good to see locally qualified scientific research backed up by professional observations.
David - September 7, 2009 4:34 AM
Bookings from Yantian port in Shenzhen are full too. But don't get too excited.
I think that it's the later than usual Christmas rush. Everyone waited as long as possible to order for Christmas--waiting for some sign that there was a recovery and now they have to get all their goods out in the next 21 days or they'll have to wait a week+ for the extended National Day celebrations the first week of Oct.
I think that things are better, but the recession isn't over yet.
John Doe - September 7, 2009 6:03 AM
I read this entry and found that Steve's observations quite incisive and unique concerning the slow recovery from the financial crisis.
Richard O'Brien - September 7, 2009 5:55 PM
Personally, I find the image of a small, tubby, curly headed red haired American lawyer in his mid-40's doing "kung fu exercises" in a public square every morning rather disturbing. Please don't ever bring that mental picture to life again, it frightens the dogs and makes babies cry.
Dan - September 7, 2009 10:05 PM
Richard,
Do you know Steve?
I ask this because he is of average height, not "tubby" and not red haired. He has been known to frighten people from time to time though....
Tong Ren Lu - September 8, 2009 12:12 AM
Steve Dickensen photo from your own firms website: http://www.harrismoure.com/our-people.html
Red curly hair. Portly. Middle aged.
robertb - September 8, 2009 1:10 AM
Qingdaoist, would you prefer secondary data from governmental statistics bureaus? Primary observation is the most reliable information.
During July and August, the usual peak time for Christmas orders, vessel operators withheld capacity in order to move rates up. That's why fewer vessels were at terminals.
Qingdaoist - September 9, 2009 1:41 AM
Robertb, an American middle aged, red curly haired lawyer spotting some ships leaving the harbor while doing kung fu exercises in the morning does not an end to the global recession make.
robertb - September 12, 2009 1:18 AM
Qingdaoist, nowhere in Steve's e-mail did he suggest that the recession was over. For an English teacher, your reading comprehension is dreadful.
robertb - September 12, 2009 1:24 AM
You're saying that Steve is claiming to end the global recession through his morning exercise routine?
You're just a few years away from wet brain.
Alex - September 13, 2009 7:16 PM
Great observation and commentary.
When I was a statistician we would cry out for stuff like this, as it gives an immediate indicator of stuff which economic stats would take weeks or months to get out.
We'd also probably follow-up with the port on any conditions they'd had (e.g. warehouse fire?), check the weather (e.g. storm delayed crossing/leaving port?), local regulations (e.g. Shandong new tax indentives?) and calls to related industries (e.g. as posted above the delay in Christmas orders coupled with long October break). A good 2 day brainstorming session perhaps.
Thanks, I'm now longing to be a statistician again!
Sol Rosenberg - September 16, 2009 12:00 PM
The ships aren't waiting to dock, they're mothballed! There is a similar wasteland of parked ships outside Singapore.
http://www.zerohedge.com/article/thousands-rusting-ship-hulls-are-fitting-tribute-speculative-market-bubble
http://www.dailymail.co.uk/home/moslive/article-1212013/Revealed-The-ghost-fleet-recession-anchored-just-east-Singapore.html
Dan Feldman - September 21, 2009 8:46 AM
I will second Steve's observations of the line of ships waiting for a berth at Qingdao Port, as I was training with him and Teacher Pan on that very Monday morning by the sea.
This past Saturday morning I ran into some friends at the local American diner in town. Got to talking with a Turkish woman who is working for Maersk. After confirming with her that Qingdao was the 3rd largest port in China, I asked her whether it was true that Qingdao port business was growing faster than Shanghai due to more favorable sea conditions. Correcting me she said that Qingdao suffers from long stretches of fog which can cause traffic jams at the port.
Now I am not sure if on that morning Qingdao was experiencing any significant fog, but it is certainly one explanation for the long line. Alex, the former statistician, is right to want to check for confirmation of port conditions. Also one data point does not a trend make.
Regarding Steve's kung fu abilities, I certainly would not pick a fight with him for fun.