An exporter in Coimbatore has the goods ready for shipment, the containers are also available for stuffing the goods, but main vessels do not have adequate space or are not available as frequently as they used to be.
This is one of the new challenges that the exporting hub of Coimbatore is facing because of the spread of COVID-19 across countries.
Initially, when China was impacted with COVID-19, exporters across sectors here were hopeful of orders shifting to India from China. Then came concerns of supply chain disruptions as a lot of industries buy raw materials or key components from China. Now, however, the exporters worry about possible shutdowns at buying markets and the problems related to logistics.
P. Subramaniam, president of Coimbatore Custom House and Steamer Agents Association, says that almost all the main vessels coming to Colombo or Kochi and proceeding to the US or EU originate in China. With shutdown in China for almost two months, the number of vessels starting from that country has reduced and the space available for cargo to be taken from other countries is also not much. Giving instances, he says, “Vessels are not available for loading even later this month and there are cases of cargo that was to be loaded on February 23 was sent only on March 8.” It may take a month or two for the situation to stabilise, he adds.
On the import front, the Government has issued orders that ports and Inland Container Depots clear imported goods immediately so that manufacturing industries that buy goods from other countries for production are not affected.
“Usually cargo sent from India reaches the US in a month. Now, it takes nearly three months,” adds S. Mahesh Kumar, president of the Coir Pith Exporters' Association.
Nearly 95 % of coir fibre exports from Pollachi in Coimbatore District is to China. The Chinese who used to reside in Pollachi and inspect the goods before shipment went home for Chinese New Year and have not returned. For almost two months, exports to China were almost nil. There are reports that China is re-opening except for a few locations and exporters here have stocks. So, the exports may revive soon. However, there are reports that containers are not available.
In the case of castings and engineering exports, sources in EEPC India (formerly known as Engineering Exports Promotion Council) say that there are two categories of exports from Coimbatore - products such as pumps and valves that are shipped to African and Latin American countries and components, castings, forgings, and machine tools that are exported to the EU or the US. Exports to African or Latin American countries are not affected, exports to other countries are also going on now. But, there is a fear that these may be impacted if the situation does not improve. Further, those who procure critical tools and parts from China could not import for the last two months and that has affected domestic sales too.
Further, travel restrictions are having a cascading effect. And, it is not just exports or imports to China and EU but also to countries such as Japan and South Korea.
G. Ezhil, chairman of the Coimbatore chapter of the Institute of Indian Foundrymen, says the foundries import a lot of raw materials from China. “That supply chain is getting affected. We have stocks now and so production is going on. European buyers have stopped coming to India and credit lines are becoming cash transactions. In many countries all offices are closed except for essential needs. If the situation does not improve, we will start feeling the impact,” he says.
As far as textile exports are concerned, A. Sakthivel, chairman of Apparel Export Promotion Council, says there are reports that Chinese ports have opened in the last three to four days and so imports are expected to resume shortly. So far, other countries have not cancelled or deferred major textile events and orders.
Raja Shanmugham, president of Tiruppur Exporters Association, adds that with travel advisories, buyers or their representatives are not travelling. “We continue to receive samples and the orders placed are shipped. But if the virus spread is not contained in the coming days and markets close retail shops as a precautionary measure, the exporters will start feeling the impact.”
One of the industry representatives said, “It is a wait and watch situation for exporters in all sectors and the developments unfold every day.”