Outrageous! Container freight rates on Asia-Europe routes have soared 10 times! The global shipping industry encounters another "wave of crit"! Soaring demand for China-Europe express trains

Has the freight dropped this week? I advise you not to think too much...

Due to the combined effect of strong shipping demand, port delays and container shortages, the spot freight rate of containers continued to rise and reached new highs.

Part of the reason for the price increase is the shortage of ships, as most of the capacity has been deployed on the fiery trans-Pacific and Asia-Europe trade routes.

Nevertheless, there is still no downward trend in freight rates from Asia to Northern Europe.

▍Container freight rates on Asia-Europe routes hit a record high

On May 17, Platts Container Rate 1 showed that the container freight rate from North Asia to the Nordic continent soared to USD 12,000/FEU, up USD 1,500/FEU from the previous week, and USD 1,300/FEU estimated on this route a year ago. Shows a nearly 10-fold increase.

On May 11th, a freight forwarder posted in Moments that the container freight rate on North Africa routes will soon exceed US$17,500, rising by US$500 in just one week, which is simply "uncommon in a century"; the price of a 40-inch container on the Middle East route was the peak last year. No more than 3000 US dollars, this week has exceeded 8300 US dollars.

Outrageous! Container freight rates on Asia-Europe routes have skyrocketed by 10 times! The global shipping industry encounters another "wave of crit"! Soaring demand for China-Europe express trains​

The latest increase in freight rates is due to the fact that demand on major global routes continues to exceed supply. Compared with the beginning of the new crown virus pandemic, there are fewer empty containers in the shipping industry. This is mainly because once the containers are unloaded from the ship, the containers are returned to the port due to shortage of dock workers, poor inland transportation, and epidemics. The time spent has greatly increased.

Some containers take 4 weeks to return to the port after unloading, but it only takes about 7 to 10 days in early 2020.

In addition, the ports of Los Angeles and Long Beach in the United States are heavily congested. 85% of ships need to drop anchor for at least 8 days before they can operate. Container cargo can stay at the terminal for up to 2 months. A relevant person at Maersk said, “It usually only takes 14 days to ship goods from Shanghai to Los Angeles, but now it takes 33 days. The sailing time is the same, but the waiting time for unloading is twice as long as before.”

Not only US ports, some ships from Asia to Europe have also been delayed, unable to reach their destinations as scheduled. Congestion has caused delays in places such as Port Klang in Malaysia, Port Rotterdam in the Netherlands, Piraeus Port in Greece and Southampton Port in the United Kingdom, up to six days.

Outrageous! Container freight rates on Asia-Europe routes have skyrocketed by 10 times! The global shipping industry encounters another "wave of crit"! Soaring demand for China-Europe express trains​

▍The global shipping industry encounters another "wave of crit"!

With the worsening of the new crown pneumonia epidemic in India, Singapore, as a shipping hub, has recently been forced to ban the entry of seafarers from India and other South Asian countries. Seafarer rotation has once again fallen into a crisis, making the already tight global shipping industry worse.

Outrageous! Container freight rates on Asia-Europe routes have skyrocketed by 10 times! The global shipping industry encounters another "wave of crit"! Soaring demand for China-Europe express trains​

Recently, a seafarer company headquartered in Singapore stated that there were only occasional cases of infection on ships in the past, but the current situation is that the rapid spread of the new crown virus on the entire ship often means that these ships are no longer navigable.

Wu Peiyuan, an associate professor at the Business School of the National University of Singapore, said: This will affect the schedule of freighters and also impact the supply chain. This will inevitably lead to an increase in consumer product prices. The reason is that the entire shipping industry has been disrupted, which may lead to inflation. Continue to go up.

Outrageous! Container freight rates on Asia-Europe routes have skyrocketed by 10 times! The global shipping industry encounters another "wave of crit"! Soaring demand for China-Europe express trains​

United Nations data shows that 80% of the world's trade relies on shipping, and 240,000 of the world’s 1.6 million seafarers are from India. Entry restrictions have undoubtedly further aggravated the impact on the shipping industry. In the short term, this situation is difficult to alleviate. According to industry insiders, the blockage of the Suez Canal in March is not worth mentioning compared with the supply chain interruption caused by the inability of crew to change shifts.

Outrageous! Container freight rates on Asia-Europe routes have skyrocketed by 10 times! The global shipping industry encounters another "wave of crit"! Soaring demand for China-Europe express trains​

Faced with a severe situation, shipping agencies and maritime experts have called for vaccinating crew members as soon as possible to be the most feasible way to deal with this crisis.

Outrageous! Container freight rates on Asia-Europe routes have skyrocketed by 10 times! The global shipping industry encounters another "wave of crit"! Soaring demand for China-Europe express trains​

Espen Poulsen, President of the International Chamber of Shipping: For us, the most critical first priority now is to persuade the governments of various countries to give priority to vaccinating relevant maritime workers as soon as possible.

▍Demand for China-Europe Express Trains Soars

Ministry of Foreign Affairs spokesperson Zhao Lijian stated at a regular press conference on the 19th that since the first China-Europe train started in 2011, the China-Europe train has continuously increased its frequency and expanded its routes. It has reached 22 European countries and its logistics and distribution network has covered all of Europe. territory.

According to reports, in April this year, China-Europe freight trains opened 1,218 and 117,000 TEUs of goods, up 24% and 33% year-on-year respectively. It has been running more than 1,000 trains in a single month for 12 consecutive months.

When answering a reporter’s question, Zhao Lijian said: “On March 19, 2011, the first China-Europe train was sent from Chongqing, China to Duisburg, Germany. This marked the establishment of a new “steel camel” between Asia and Europe. So far, the total number of China-Europe freight trains has reached 38,000, transporting 3.4 million TEUs of goods, reaching 151 cities in 22 European countries, and the logistics and distribution network covering the whole of Europe."

The rising trend of shipping prices has not stopped. At present, many shipping companies have issued further price increases announcements. For this reason, many foreign trade companies have begun to try to use China-Europe Express to transport goods to reduce the impact of shipping freight and increased timeliness.

Outrageous! Container freight rates on Asia-Europe routes have skyrocketed by 10 times! The global shipping industry encounters another "wave of crit"! Soaring demand for China-Europe express trains​

The person in charge of Zhejiang Yiwu Boya Balloon Co., Ltd.: As long as the difference between the China-Europe Express and the sea freight is less than 1,000 US dollars, everyone will use the China-Europe Express. The faster the goods go out, the less funds they have to advance.

With the complaints of cargo owners and freight forwarders, shipping companies have made a lot of money in the context of the surge in business volume, and almost all shipping companies have continued to break previous profit records. Although shipping congestion makes operations more difficult at times, rising freight rates are still conducive to the financial situation of shipping companies.

With congestion in many major ports around the world, further disrupting the logistics supply chain, container liner schedules are experiencing extensive delays. Nowadays, the shipping industry is even more terrible than price hikes because of shipping delays. I have spent several times the money, but it hasn't been seen yet...