Tagged "China"
Chinese factory closures, Jan-June 2023
During the following holidays, Chinese factories may be closed. Chinese suppliers may be difficult to reach or slow to respond during these times:
Upcoming Chinese Holiday
Golden Week in China is a week-long holiday that will begin on Saturday, October 1st and end on Friday, October 7th. During this time, Chinese suppliers may be difficult to reach or slow to respond.
Minor slowdown expected as China celebrates International Workers' Day
China will celebrate International Worker's Day (also known as Labor Day). Factories will generally be closed from 5/1 - 5/4 which may mean that you won't be able to communicate with your suppliers over that period. This should not cause any significant delays and factories plan around this closure to minimize disruption.
Potential delays due to COVID-related closures in China
Regions of China — including Shenzhen and Shanghai — have shut down due to a rise in COVID cases. Since offices and manufacturing facilities are on lockdown in these areas, there may be production delays. We recommend messaging your supplier(s) in China to find out if any of your orders may be affected. Read more about China’s lockdowns.
Lunar New Year 2022
All factories in China will close between 31 January and 6 February for the Spring Festival (commonly known as Chinese New Year or Lunar New Year). Typically effects of the shutdown will be seen from mid-January as many people extend their holidays.
Ports will also close briefly so you should plan for your packaging to leave by the third week of January to be certain that they will be in transit before the holiday. Speak to your suppliers or freight forwarder about air freight if you have an urgent shipment, although costs usually rise dramatically at this time of year.
Different industries often stagger the closures so you should communicate with any active suppliers about their specific dates. Although the official holiday lasts for one week, some factories can be closed for up to 4 weeks.
Plan ahead
We recommend ordering earlier and higher quantities than usual for this time period. You can also combine air and sea freight to make sure you hit your timelines. Alternatively, the marketplace has a great selection of US suppliers who can quote for you.
Post-CNY Delays
When factories reopen, they often have a production backlog and minimal workforce. This means that delays are likely after CNY, so it is best to get full transparency from your suppliers before you place any new orders. This is exacerbated by potential supply chain issues as materials suppliers may be closed for longer.
Timeline
Electricity rationing expected to reduce capacity in China
Power outages and electricity rationing in China is expected to reduce capacity, increase lead times, and increase costs from factories in China.
Manufacturers in China have reported that electricity may be rationed in the coming months. In some regions factories have been temporarily closed while in others they are subject to a 50% rationing of supply.
This rationing is driven by a combination of coal shortages and the enforcing of environmental targets.
In practice this will mean higher prices and longer lead times. This will add to existing delays seen at Asian and US ports although that is expected to improve once China returns from the Golden Week holiday.
If you need to order from China in the next 3 months, make sure you discuss this with your supplier so that you have a clear understanding of the timelines. You may also want to explore US manufacturing alternatives as there is no guarantee that the volatility won’t continue through 2022.
Over 700 US factories have joined Lumi in the last 6 months with wide availability across products. Explore suppliers in the United States on Lumi.
Port congestion is causing delays
Shipping times from Asia to the US are continuing to rise as we approach the holiday season. Ports across the US and China are struggling to meet the current capacity needs, which is leading to delays in departure and arrival for goods. The Los Angeles—Long Beach hub is the most severely affected with more than 50 ships unable to dock. Other major US ports have seen backlogs over the last few months.
You can expect to see a 2-4 week delay in ocean freight shipments. If your goods have not left Asia yet, you may want to consider partial air freight.
Golden Week closures in China
China will celebrate Golden Week from 1-7 October and the major ports will be closed.
Expected communication delays for Dragon Boat Festival, June 12-14
Manufacturers in China are preparing for the annual Dragon Boat Festival, which will last from June 12th to June 14th. Communications may be delayed until they return to work on June 15th.
Although not as long as the Lunar New Year celebration, the Dragon Boat Festival is a widespread holiday in nearly all of Asia. Plan on minor disruptions to production and slower responses from factories, freight forwarders, customs brokers and anyone else directly connected to the region.
The Dragon Boat Festival has been celebrated for thousands of years and its traditions are associated with driving off evil spirits, disease, and bad luck.
Expected production delays for Lunar New Year
Factories in Asia will be closed February 10-20 in observance of Lunar New Year (February 12). Some factories allow workers to take more than the allotted time off, so we like to plan for reduced production runs for the remainder of the month.
Before and after the weeks-long holiday, factories will experience congestion as they prepare for the close, and then catch up on the backlog. This will result in longer than expected lead times in early March, but production will level out in mid to late March. Please note, the delays in production also have an effect on logistics and congestion at port. All cargo should be planned in advance. Bookings within the Lumi freight team will begin March 15 and proceed as normal following that start date.
To avoid production delays, if you are ordering from factories in Asia and need to receive items before the end of March, we advise placing your orders as soon as possible.
Preempting production delays for Lunar New Year
Factories in Asia will be closed for weeks in early February in observance of Lunar New Year (February 12). Orders placed after December 31, 2020 will likely encounter serious production delays.
Before and after the weeks-long holiday, factories will experience congestion as they prepare for the close, and then catch up on the backlog.
To avoid production delays, if you are ordering from factories in Asia and need to receive items before the end of March, we advise placing your orders as soon as possible.
