When freight rates soared in August and September last year, ocean carriers were already chanting “freight rates are becoming crazy” and “record breaking”. Today, ocean freight rates are still breaking through previous records. At the same time, record-breaking congestion of global liners is taking turns. Due to the epidemic and the substantial increase in freight volume since the end of last year, terminals are becoming a global bottleneck.
1. Shipping prices have risen again.
Hard to find a warehouse and rising prices have become the norm in the shipping industry this year.
The congestion of the port and the sluggish supply chain, the continued growth of exports, the strong demand for container transportation, and the decline in the capacity of the besieged epidemic, the export container freight rate continues to rise due to multiple factors.
On June 18, the Shanghai Shipping Exchange announced the latest export container freight index. Among them, the Shanghai Export Container Index (SCFI) reached a record high of 3,748.36 points, an increase of 44.43 points or 1.2% compared with last week. The lowest point was 818 points, up 358%.
The China Export Container Index (CCFI) announced on the same day rose to 2526.65 points, a record high, up 84.08 points or 3.4% compared to last week, and 203% higher than last year’s lowest point of 834 points.
In terms of actual freight rates, according to the monitoring of the international logistics online platform “Where to ship”, in late June, the freight rate for a 20-foot standard container was approximately US$6,000 from Shanghai to Hamburg Port in Germany, and from Shanghai to Los Angeles Port in the western United States. , About 9,000 U.S. dollars, and about 10,000 U.S. dollars from Shanghai to New York Port in the east of the United States. The freight rates from China to Europe and the United States have increased by 5-10 times compared with the same period last year. At present, it is still difficult to find one class, and the price continues Create a new high.
If the departure point is changed to Yantian Port, which has recently been affected by the epidemic, the freight rate will be higher than that of Shanghai Port. Monitoring shows that in late June, the freight rate for a 20-foot standard container was about US$6,800 from Shenzhen Yantian to Hamburg Port in Germany; to the Port of Los Angeles in the western United States, the price ranged from US$8,100 to US$9,800 to the New York Port in the eastern United States. The price even exceeded $10,000.
2. Liner congestion spreads globally, 101 ports report congestion
Seaexplorer, a container transportation platform created by logistics giant Kuehne+Nagel, shows that as of last Friday, 304 ships were waiting for berths in front of ports around the world. Seaexplorer data shows that 101 ports have reported disruptions such as congestion. According to a report from Dexun’s digital department, the number of ships in line reached 350 last week, and then fell back to 304.
The obvious change in the past week is that in recent weeks, South China’s ports have been affected by the new crown pneumonia epidemic, and the congestion seen in important export areas is now spreading to other important hubs. Take Singapore as an example. The number of container ships waiting for berths has been in the past week. An increase of 37.5%, Asian internal ports such as Laem Chabang are now also experiencing ship queuing, and ports on the east coast of the United States have also encountered various disruptions.
Last week, container ships lined up in Chinese waters accounted for more than 50% of the global total. Today, this proportion has dropped to less than 40%. However, global congestion is increasing and spreading.
Maersk, the world’s largest container shipping company, discussed the tense nature of global supply chains in an earlier article and warned that this has become the new normal.
“Trends are worrying. Constant congestion is becoming a global problem. Due to the epidemic and the substantial increase in freight volume since the end of last year, terminals are becoming a global bottleneck, whether it is in berths, storage yards or shutting out cargo. This situation continues to exist in the entire logistics chain-with the increase in the number of warehouses and distribution centers.” Maersk said.
At the end of May, Yantian Port was closed due to some operations due to the epidemic, and the blank voyage data of Shenzhen’s main ports (including Yantian) surged. From June 1st to June 15th, 298 container ships with a total capacity of more than 3 million teu (international standard unit) crossed Shenzhen. The number of blank flights increased by 300% within one month. The number of export containers has caused serious problems. Backlog.
In the past two weeks, the 7-day average residence time of export containers at Yantian Wharf doubled, reaching 23.06 days on June 15; the average residence time of imported containers was lower at 5.96 days. During the same period, shipping companies were avoiding ports.
Project44 Marketing Vice President Josh Brazil said: “Although the epicenter of the accident is Yantian, these figures mean that the entire maritime world is facing trouble, especially for companies that rely on this route.” “Even if it is not directly affected by the situation in Yantian. Affected shipments will also be affected because shipping companies are adjusting their networks to avoid congestion in Yantian.”
Hind Chitty, Chief Consultant of Drewry Supply Chain Consulting: “The carrier skipping Yantian Port during the rotation has caused multiple side effects. The additional shortage of empty containers in the area and the east-west ocean freight rates have also seen an unprecedented surge. Spread to other trade routes.”
3. The shipping was not smooth, and the total export volume in May fell short of market expectations
According to data released by the General Administration of Customs, my country’s total exports in May were 263.92 billion U.S. dollars, a year-on-year increase of 27.9% and an increase of 23.4% over the same period in 2019. Exports in May still maintained a growth rate of more than 20%, but under the generally higher market expectations, it was lower than the expected value of 31.9%, and it was also lower than the April data. The CITIC Securities team clearly stated that my country’s exports in May were affected by multiple factors, such as the continued export of European and American external demand, the strengthening of the renminbi, and the slight weakening of ASEAN’s external demand. In addition, the decline in exports needs to pay attention to the certain resistance that factors such as the surge in shipping prices in May and the unsmooth shipping caused to current exports.
The team of CITIC Securities clearly stated that the current soaring shipping prices in Europe and the United States show that demand in Europe and the United States is not weak, and the lack of smooth shipping may pose a certain resistance to export transportation. Judging from the trend of the CCFI index in May, in addition to the slight weakening of the Southeast Asian shipping index, the CCFI index of the European route, the eastern US route, and the western US route all increased significantly, indicating that the demand in Europe and the United States remained strong in May, and the demand in Southeast Asia was disturbed by the epidemic. Slightly weakened. However, the continuously soaring freight index may pose a certain resistance to exports. On the one hand, the triple pressures of rising raw material prices, appreciation of the renminbi, and high shipping prices have inhibited the enthusiasm of small and medium-sized enterprises to receive orders. On the other hand, facing the current problems of poor shipping, port congestion, prolonged delivery time, shortage of containers, etc., some exporters are also facing the problem of not daring to receive orders and not being able to ship goods, which has exacerbated the problem of export transportation. resistance.
Generally speaking, although the export growth rate in May fell from April, export resilience still exists. However, the CITIC Securities team also stated that the decline in exports in May requires attention to the resistance to current exports caused by factors such as the surge in shipping prices in May and poor shipping. It is expected that the pressure of poor shipping will be relieved in the later stage. The Guangdong epidemic may continue to affect export transportation in June, but the impact is expected to be short-lived.
The impact of the current Southeast Asian epidemic on my country is two-way. On the one hand, ASEAN’s external demand may be weakened. On the other hand, due to the suspension of ASEAN’s production capacity repairs, the substitution effect of my country’s exports will increase. However, whether order backflow occurs requires further Observation also depends on the prevention and control of the epidemic in Southeast Asia. On the whole, my country’s export structure has been continuously optimized. Among the current export products, electromechanical products and high-tech products have become the main force. Under the continuous external demand, my country’s exports will still maintain a certain degree of resilience.
Post time: Jun-24-2021