- Lockdowns in China have battered commodity markets this morning amid the prospect of weaker demand
- Most recently, the city of Zhengzhou was plunged into lockdown, with Beijing ramping up testing and preparing hospitals for a spike in cases
- The fears pushed the price of many commodities down this morning, with iron ore, oil, and industrial metals declining on the prospect of weaker demand’
- Another key concern is on the country’s ports, which is intensifying global supply chain issues
- Shipping to the United States is taking 74 days longer than usual, while ships to Europe are arriving an average of four days late
Lockdowns in China have battered commodity markets this morning amid the prospect of weaker demand.
Most recently, the city of Zhengzhou was plunged into lockdown. The city is a major producer of a number of commodities, but is mostly known for coal mining.
Meanwhile, the market has been concerned over the rising number of cases emerging from Beijing. It has been ramping up testing and has kept schools closed. The city has so far avoided a lockdown, but authorities have been preparing hospitals for a spike in cases.
The fears pushed the price of many commodities down this morning, with iron ore, oil, and industrial metals declining on the prospect of weaker demand.
The concerns stem from a fear Beijing may suffer a similar fate to Shanghai, who is now in its fourth week of lockdown. Delivery issues, has forced online purchases to be restricted to food and daily necessities.
Another key concern is on the country’s ports, which is intensifying global supply chain issues.
The Port of Shanghai has 344 ships awaiting berth, representing a 34 per cent increase over the past month. Shipping to the United States is taking 74 days longer than usual, while ships to Europe are arriving an average of four days late.
These delays then create a flow on effect of disruption, with a shortage of empty containers delaying supply of European goods to the US.