Impact of Tianjin Explosion on Supply Chains

Last week’s devastating explosion that killed at least 114 people in a Port of Tianjin warehouse district is already disrupting some supply chains, and others with high exposure to the port could also experience delays receiving imports from China, experts say.

Global automakers are among those impacted by the deadly industrial accident, and insurance losses from the blast could reach $1.5 billion, according to reports from Reuters.  Almost 5,000 automobiles were damaged in the blast and that the number could grow as the damage assessment continues.

Officials in the Chinese city have already ordered the port to stop handling container vessels carrying any shipments of hazardous materials, as well as oil and chemical tankers.
Commodities that will be impacted the most by the accident are steel products on the export side and raw materials, such as petroleum, soybeans and wheat, and automobiles, said Datamyne.
Tianjin is China’s largest import gateway for cars, with about 40 percent of the market, according to the official Xinhua news agency.

As a result of the explosion, all of the transportation industry – including sea freight or rail transport – will be faced with an unprecedented inspections and extremely tough supervision all over China in the upcoming period.

Among the priorities for Transportation security is China Railways. These days, a lot of materials have been distributed to local stations and railway administrations in order to study, analyze and discuss on how to prevent such terrible accident in the future and how to find out the potential danger during  railway operations.
As our local partners report, Qingdao Customs started to apply random inspections. Previously, in transit cargo was usually not opened for inspection, because they are destined for another country via Chinese territory. But now transit cargo will be taken under stricter control,  starting this week,  Customs will  randomly  make inspections of cargo before dispatching.
RCL Agencies will continue to monitor the situation and report further updates once available. Please be guided accordingly.