Someforeigntradecompanieshavereportedthatthisyear’sChristmassupplypeakperiodisnoteasy.Problemssuchasrisingrawmaterialprices,risingfreightcosts,and”hardtofindabox”havecausedforeigntradecompaniestofacethesituationof”businessbutnoprofit.”
In response to this issue, Ministry of Commerce spokesperson Gao Feng said at a regular press conference on the 26th that due to the continued spread of the global epidemic, rising international commodity prices, structural imbalances in global shipping capacity and other factors, The high prices of some raw materials, high freight costs, and insufficient transportation capacity have been plaguing foreign trade companies.
Encountering a shipping disaster during the Christmas season
Gao Feng pointed out that June to August every year is the time when Christmas supplies are sold. During the peak cargo period, this year, considering the risk of shipping delays in ports, overseas customers generally place orders in advance by viewing the goods and signing orders online. Some orders have been shipped and delivered earlier than in previous years, and some orders have been backlogged in domestic warehouses due to difficulties in booking space or high freight charges, putting pressure on business operations.
It was previously reported that as the world’s largest distribution center for Christmas supplies, Yiwu contributes two-thirds of the world’s Christmas supplies. However, judging from the current situation, thousands of Christmas trees and Santa Claus and other related crafts will be forced to be trapped in Yiwu warehouses during this year’s peak Christmas shipping season.
Some foreign trade companies said that due to skyrocketing international logistics prices and overwhelming congestion, millions of Christmas trees could not be shipped overseas in time, and companies with an annual export volume of about 150 million yuan had to spend 2 million yuan. , specifically renting a warehouse of 10,000 square meters for stacking Christmas trees.
It should be noted that in previous years it would take until the end of May to receive orders for a whole year, but this year it was earlier than March. According to staff analysis, the reason why customers placed orders early this year is not only that orders that were on the sidelines last year due to the epidemic were released this year, but also because the tight supply of international logistics has led to rising freight rates and lengthened shipping cycles. As a time-sensitive product, For commodities, customers believe that they must place orders in advance, and the earlier they get the goods, the safer they are.
According to data from the container shipping platform Seaexplorer, as ports on all continents are facing operational disruptions, as of August 24, more than 362 large carrier ships were anchored outside the ports. According to port performance data from IHS Markit, as of May this year, the time for container ships to wait for berths has more than doubled since 2019, with the deterioration most severe in North America, where the average anchor time for ships in May 2021 was 33 hours, In May 2019, the average was only 8 hours. August is traditionally the peak season for freight. The latest forecast released by the National Retail Federation shows that the number of containers entering North America in August this year is likely to hit a new record. By then, container congestion will continue to affect shipping prices.
Gao Feng said that the phenomenon of tight shipping capacity and high freight rates is global. The Ministry of Commerce, together with the Ministry of Transport, the Ministry of Industry and Information Technology, the State Administration for Market Regulation and other units, has actively taken measures to increase container supply, enhance shipping capacity, and strengthen international cooperation. Local governments have also increased shipping service guarantees for small and medium-sized enterprises to help them reduce costs and losses.
“We will continue to work with relevant departments and localities to further study targeted measures, do a good job in stabilizing foreign trade and smoothing international logistics, strengthen cooperation with various trading partners, and work together to meet challenges.” Gao Feng said .
Global port congestion and freight forwarder fare increases have pushed freight rates to record highs
On August 25, the “International Logistics and Shipping” event was held at the International Economic Center During the monthly economic talk with the theme of “Situation”, Jia Dashan, deputy director of the Water Transport Science Research Institute of the Ministry of Transport, pointed out that in terms of tonnage, compared with 2019, global shipping demand fell by about 3.4% in 2020, and containers fell by 0.7%. Global shipping demand is expected to grow by 4.4% in 2021, while container demand will grow by more than 5%. In terms of shipping capacity, compared with 2019, the global shipping fleet size will increase by 4.1% in 2020, and is expected to increase by 3% in 2021.
He pointed out that compared with 2019, global shipping demand is expected to grow by 1% this year, and containers will grow by 5%. The scale of shipping capacity and the scale of container supply will increase by 7.1% and 7.4% respectively. The overall fleet size is faster than Transportation volume has increased, but freight prices have increased significantly. In his view, increases in container ship rentals, seafarer costs, intermediary fees, and oil prices have all contributed to the surge in shipping costs.
Data show that the shipping price of 40-foot standard containers on the China-US East Route has exceeded US$20,000, a five-fold increase year-on-year. The Shanghai Export Container Freight Index, which represents the spot price, announced on August 27, was recorded at 4385.62 points, continuing to hit a record high, with an increase of more than 4 times compared to the lowest point last year.
Song Xiaoming, deputy general manager of Guangzhou Port Group, introduced that currently, container shipping lines are operating around the world.�The transport capacity reaches 24 million TEU and the container capacity reaches 48 million TEU. In the first half of the year, the shipping capacity from China to North America and Europe increased by 55% and 30%. However, the problem of “hard to find a ship and hard to find a box” is still getting worse.
In Song Xiaoming’s view, the fundamental reason for the shortage of transportation capacity is the low efficiency of transportation caused by port congestion and shortage of seamen. At present, the average port congestion time for basic ports in Europe is 3 to 5 days, for ports in the western United States, 10 to 12 days, and for ports in the eastern United States, about 7 days. Recently, Asian ports such as Yantian Port and Ningbo Port have also experienced port congestion.
In addition, he emphasized that we should be wary of freight forwarders increasing prices at different levels, pushing up the entire shipping price. Since the Ministry of Transport of China has strict management of shipping prices, the prices of all routes and various surcharges need to be reported to the Shanghai Shipping Exchange. Therefore, the basic charges of shipping companies are not too high, but the intermediate freight forwarding companies have to add layers of fees. However, the price has doubled, which has caused considerable logistics cost pressure for the export of manufacturing companies. </p
