Carl Bentzel, a commissioner at the Federal Maritime Commission in Washington DC, has published a 28-page report following his year-long investigation into the stranglehold Chinese companies have in the manufacturing of containers and intermodal chassis, with a plea that the Joe Biden administration take action.
The report draws attention to China’s market control in global container manufacturing with Bentzel saying he wanted to create awareness of potential market manipulation that has added to supply chain disruptions. According to the study, the three largest Chinese manufacturers control over 86% of the world’s supply of intermodal chassis, and those same companies manufacture over 95% of containers in the world’s market, including US domestic train and truck intermodal containers.
As a country our maritime equipment and industry is increasingly dependent on China
“This report is important in what it represents – that as a country our maritime equipment and industry is increasingly dependent on China. The pandemic has illustrated how interdependent our supply chain and economy is with our global partners. We need to closely evaluate our partnerships,” said Bentzel.
The report, Bentzel said, was designed to generate debate among policymakers about what the longer-term consequences are to the United States and other nations of relying completely on Chinese manufacturers as the source for containers and chassis.
When demand for ocean containers increased, Bentzel argued Chinese-based intermodal equipment manufacturers were slow in ramping up production, raising the question, he argued, of whether this was part of a deliberate strategy to manipulate prices.
The Department of Commerce in Washington DC has determined that Chinese container and chassis manufacturers are state-owned and controlled and are the recipients of large government subsidies.
“[T]he issue of Chinese state control of manufacture of containers and chassis issue needs much closer review,” a release accompanying the report stated.
Recently Vietnam has stepped up plans to boost container manufacturing as an alternative to China, with a number of factories set to open this year, albeit still only able to supply a tiny percentage compared to Chinese output.
Copyright: Mr. Sam Chambers