Gambling on the ship! Price increase! Hard to find a container! Difficult to deliver goods for export companies
time2021/07/13
- Gambling on the ship! Price increase! Hard to find a container! Difficult to deliver goods for export companies
Gambling on the ship! Price increase! Hard to find a container! Difficult to deliver goods for export companies
According to the latest data released by the Shanghai Shipping Exchange, as of July 2, China’s export container freight index was reported at 2653.32, an increase of 2.4% from 2591.41 on June 25. The container shipping company also announced the benchmark freight rate table for containers at the beginning of July, showing that the container freight rates of many routes have increased. Why did the international container freight rates rise again? What impact will this have on related industries? The reporter conducted an investigation in Shanghai.
Frequent adjustments of freight rates, freight companies are busy receiving orders Guo Shaohai is the person in charge of a freight forwarding company in Huangpu District, Shanghai. At 8 am, when the reporter met him, he was confirming the container quotation of the day. He told reporters that the business volume has increased a lot this year, but the international container freight rates have been frequently adjusted recently. So that their workload has increased significantly, and every day they have to repeatedly confirm the shipping company’s cabin quotation on that day.
Guo Shaohai, head of an international freight forwarding company in Shanghai: Compared with before, the workload has increased by 4 to 5 times, and now it is "person-to-person". After booking the space, you must stare at the box.
The reporter learned that from July 1st, shipping companies have made a new round of adjustments to the quotations of routes. Although some offshore routes are showing a downward trend, most of the ocean routes are expected to increase prices. The main purpose of shipping from China to Europe is Take the port benchmark freight rate as an example: on July 1, the standard container benchmark freight rate was reported at US$7,300/container, compared with the price quoted on June 25 of the previous week: US$6,600/container, an increase of more than 10%. Similarly, the benchmark price of a large box was reported at $13,600 per box, an increase of more than 7% compared to the previous week's quotation. Guo Shaohai, who has been in business for more than 30 years, said that he has never experienced such a continuous increase in freight rates. He told reporters that there are many factors that affect international container freight rates, the most important being the volume of cargo carried and the efficiency of the port of destination.
Guo Shaohai, the person in charge of an international freight forwarding company in Shanghai: Hamburg, the main port of Europe, is extremely congested. There are many ships waiting outside. Now there are three to four hundred ships waiting outside. In the past, there were none. It would take a lot of time to clear the port. The shipping company has announced that it will jump to Hamburg for two months. It is conceivable that it will not be resolved within two months.
The decline in port dredging efficiency of some destination ports directly caused freighters to jump to nearby ports and then transfer them to destination ports by land or short barge, which greatly increased the cost of shipping companies. The backlog of containers in the early stage is in urgent need of port evacuations and transshipment, and superimposed freight orders are still increasing, which makes it difficult to alleviate the pressure on some destination ports in the short term, pushing up the recent international container freight rates.
Many orders are difficult to ship, export companies increase bookings
Behind the increase in this round of container freight rates, it corresponds to the insufficient supply of container space. What impact does this have on the shipments of export companies, and what challenges will freight forwarders face?
At a freight forwarding company in Yangpu District, Shanghai, Zhang Yan, the manager of the key account department, received Shen Zhenqing, the freight manager of a vitamin raw material manufacturer.
After a round of negotiations, Shen Zhenqing finally got only 5 shipping spaces for containers.
Shen Zhenqing, international freight manager of a chemical company: First of all, our cabin insurance (space), in fact, our demand is much higher than that of cabin insurance (space), so now there is no way but to find an agent. I did not expect that this year has risen to the present. Five or six times the price. Shipping to North America routes is about US$15,000 for a small box and US$18,000 for a large box.
Zhang Yan told reporters that in previous years, freight forwarders generally had to find sources of goods. Since the beginning of this year, customers like Shen Zhenqing have suddenly increased in number, which also makes them overwhelmed. In order to ensure shipments, some customers will not hesitate to increase prices for space.
Zhang Yan, manager of the key account department of an international freight forwarding company in Shanghai: Because many of our CIF (CIF) goods cannot be booked, it is also because of the price increase. The carrying capacity will be affected, because our space is limited and we can only do business in the limited space. Maybe we can really meet the customers' demand for shipments.
The backlog of containers is seriously full of transit warehouses
The reporter learned in the interview that high freight rates have also affected the speed of order delivery for some export companies. Some products with low value can only be temporarily stacked in transit warehouses. What impact will this have on the warehousing end?
Zheng Peng is the person in charge of a foreign trade transit warehouse in Shanghai's Minhang District. His daily work starts with inventory. The current international container capacity is tight. The temporary container storage area of this warehouse has stacked more than 20 heavy containers for export.
According to Zheng Peng, the current storage capacity of this transit warehouse has exceeded 85%, which is close to the state of full storage. More than 30% of them need to be transited for export, which is an increase of 10% over previous years. In a warehouse that stores raw materials for export, the reporter noticed that not only the temporary storage space is already full of containers, but the stocking space here is also saturated.
According to data from the General Administration of Customs of my country, my country’s total export value in May 2021 was US$263.922 billion, an increase of 23.4% from US$206.431 billion in the same period last year. As my country’s exports increase, container throughput has repeatedly hit new highs. From January to May this year, the container throughput of my country’s eight major hub ports reached 230 million TEUs, an increase of 17.1% from the 196 million TEUs in the same period last year. Industry insiders said that with the improvement of the epidemic situation in various places, the effective international container capacity is recovering, and the congestion of the port will be eased in the fourth quarter.
Chen Jinhai, chief analyst of the transportation industry of Tianfeng Securities: In the fourth quarter, our freight demand will enter the off-season, and the volume will relatively decrease. With the popularization of vaccination in the fourth quarter, it is very likely that the congestion in the port will gradually ease, so shipping prices are likely to begin to return to normal.