Shipping prices hit record highs, impacting cross-border e-commerce, and unstable shipping schedules create demand for "overseas warehouses"

21st Century Business Herald reporter Huang Wanyi, intern Long Qing Guangzhou report

According to the current data released by the Shanghai Shipping Exchange, on January 21, 2022, the China Export Container Index (CCFI) was 3555.24, setting a new record high again. Among them, the latest data on the export container index of European routes is 5636.83, the US west route is 2590.39, and the US east route is 2738.93.

21 The reporter learned that the global shipping freight capacity has been seriously affected by the epidemic, which has had a significant impact on international bulk commodity trade, and cross-border e-commerce, as an emerging form of foreign trade, has also been hit to a certain extent.

"The shipping price has doubled, causing many of our customers to directly dump the cabinet." Zheng Jiexi (pseudonym), the person in charge of a to B cross-border e-commerce company in Shenzhen, told 21 reporters, "Adding customs clearance and demurrage charges, it is worth more than the value of the goods. Expensive, of course customers will choose to abandon the container.” According to Zheng Jiexi, the shipping price will increase from May 2021, and the route to South America was about US,500 before the price increase, but now the price has reached US,500. And there is no sign of a fall back.

However, the reporter also observed that at the same time as shipping costs skyrocketed, some suppliers began to choose overseas warehouses to stock up in advance to deal with uncertain factors such as shipping costs and delays in shipping schedules. The e-commerce export industry, especially the overseas warehouse layout, is worth looking forward to in the future.

Spring Festival market is still high

Every January, affected by the traditional Chinese Spring Festival, many factories are on holiday and workers return to their hometowns. Due to the long Spring Festival holiday in factories, production capacity has declined. Combined with the fact that the Christmas purchasing season in Western countries in December has released consumer demand ahead of schedule, sea freight prices usually tend to go down slightly during this period.

According to Dai Bin, vice president of Difang Sifang and general manager of the B-class business unit, due to the traditional Spring Festival holiday, many goods are basically finished in December or early January. In the case of shortages, the surplus positions will naturally decrease in price, resulting in a downward trend in shipping prices. However, for the first half of 2022, there is still a shortage of inventory, and it is expected that freight rates will continue to be high.

The data shows that the China Export Container Index (CCFI) was 3555.24 on January 21, 2022, and the CCFI was 3489.94 on January 14 in the previous period, and the index continued to rise by 1.9%. Holiday routines have not been able to turn the seaborne market around.

"Actually, the sellers are very painful." The logistics director of a to C cross-border e-commerce big seller said bluntly, "On the one hand, the shipping price has risen wildly, and the small sellers are not able to negotiate with the shipping company for positions; at the same time, some products are sold by Eliminate, that kind of bulky items with low unit price, such as Christmas trees, cannot be sold at all.”

Zheng Jiexi mentioned that in addition to the increase in shipping costs, companies are also faced with the situation of lack of containers and unable to deliver goods. Coupled with factors such as exchange rate fluctuations and changes in raw material costs, the increase in customer purchase costs has led to a decrease in the number of orders.

For cross-border e-commerce companies, the most direct impact of rising shipping prices is the rise in transportation costs. In fact, compared with traditional foreign trade, the logistics cost of cross-border e-commerce has always been relatively high because the delivery of cross-border e-commerce is usually more detailed. Professor Chen Wanling, director of the International Economic and Trade Research Center of Guangdong University of Foreign Studies, pointed out to reporters, "With the rapid rise in sea freight rates, cross-border e-commerce companies cannot adjust freight rates frequently. The impact of the increase is still relatively large.”

Dai Bin also mentioned the rising cost of cross-border logistics companies, but he believes that if the cost of the whole container is evenly spread to a single cargo, the overall cost of cross-border e-commerce companies is still controllable. "No matter if a container to the United States rises to 20,000 or 30,000 US dollars, the transportation cost of a single cargo in the container may be one or two US dollars, which is still relatively indifferent to many customers."

In the case of high shipping costs, relying on a single mode of transportation has exposed shortcomings. Multimodal transportation, that is, the combination of multiple transportation methods, is considered to be the direction of future international transportation. Professor Chen Wanling analyzed the pros and cons of several modes of transportation: "If the scale of freight is relatively small and no containers are required, then it may be better to travel by train, such as the China-Europe train. The second is air transportation, although the cost is higher, but When the sea freight rises to a certain extent, or even equals the cost of air transportation, then some small but expensive products can be considered for air transportation.”

Cross-border e-commerce faces bottlenecks in shipping negotiations

In addition to factors such as lack of containers, tight shipping capacity, and rising freight rates, the post-pandemic market situation also revealed that cross-border e-commerce companies still face the problem of insufficient bargaining chips in the international shipping market.

With the development in recent years, many international shipping companies have formed alliances. 2M Alliance, OCEAN Alliance and THE Alliance are the three major international shipping alliances. The above-mentioned person in charge of the to C cross-border e-commerce big sales logistics said that before the alliance was formed, the shipping companies were still in a state of competition, and they competed to seize the market at low prices, but after the formation of the shipping company alliance, a "tacit understanding" was formed, that is, The price remains agreed, and no one will lower the price. "Since the outbreak of the epidemic in 2020, we have noticed that the alliance has raised prices at the same time. It can be said that it has controlled the entire market. Almost every half month, we see shipping companies adjust prices at the same time."

In fact, the alleged collusion of shipping companies to raise prices has attracted special attention. On January 11, the General Office of the State Council issued the "Opinions on Doing a Good Job in Cross-Cycle Adjustment and Further Stabilizing Foreign Trade" (hereinafter referred to as the "Opinions"), pointing out that it will continue to strengthen supervision in the field of international shipping, crack down on illegal and illegal charges, and drive up freight rates in accordance with the law. behavior. Investigate suspected monopolistic behavior in accordance with laws and regulations. On multilateral and bilateral occasions, we call for the smooth flow of international logistics.

According to an announcement issued by the Korea Fair Trade Commission on January 18, 23 domestic and foreign shipping companies will be fined a total of 96.2 billion won (about 512 million yuan) for allegedly driving up shipping costs.

After the epidemic, when global shipping capacity did not rise but fell, large multinational companies have occupied a fixed number of positions, and newly entered cross-border e-commerce sellers often do not have bargaining chips.

The person in charge of the above-mentioned to C cross-border e-commerce big sale logistics mentioned that some large multinational companies such as Wal-Mart have a fixed number of positions themselves, and they have signed contracts with shipping companies for decades. No matter how the market changes, The bulk of the positions are reserved for big companies, and the prices that big companies can get are usually lower. "The last remaining positions are given to domestic freight forwarding companies. With the shortage of global shipping capacity and the year-on-year increase in my country's export goods, a large part of the increase in shipping demand will be paid by some Chinese merchants."

The person in charge of logistics mentioned some ability to resist the risk of price increases. For example, some big sellers have large orders and can get some contract prices with shipping companies, which plays a role in resisting the risk of market price changes.

In fact, the above-mentioned "Opinions" issued by the General Office of the State Council also clarified that foreign trade companies are encouraged to sign long-term agreements with shipping companies, and local governments and importers and exporters associations are guided to organize small, medium and micro foreign trade companies and shipping companies to connect directly with shipping companies.

Overseas warehouses usher in opportunities

Regarding the research and judgment of the global shipping situation in 2022, market voices generally believe that the overall shipping capacity is still relatively short, and it is almost impossible to return to the low level before the epidemic.

On December 29, 2021, Yang Zhijian, general manager of COSCO SHIPPING Holdings, said at the extraordinary general meeting of shareholders that the company's long-term contract customers have a strong willingness to sign contracts, and both volume and price have risen. The price of long-term contracts in 2022 will be 2-3 times that of 2021.

Professor Chen Wanling analyzed that it mainly depends on the epidemic situation. "European and American countries have basically loosened the control of the epidemic. The normalization of epidemic control may lead to the recovery of production, but the recovery of production capacity will not be too fast. Combined with factors such as the reduction of the virus infection rate and the recovery of employment data, the shipping price may drop slightly, but The overall trend will still hover at a high level.

In addition to rising transportation costs, unstable shipping schedules also have a certain impact on the cross-border e-commerce industry. In addition to the rising cost, Zheng Jiexi said frankly: "The waiting time for the ship has also been delayed, so it has also resulted in the loss of several orders."

Professor Chen Wanling mentioned: "In the cross-border e-commerce industry, competition will inevitably intensify in the process of rising shipping prices. Shipping is blocked, and the delivery time of goods is prolonged, resulting in untimely delivery. This is a bad experience for customers, and customers will choose other suppliers. business, leading to loss of orders.”

The instability of the shipping schedule has led to a reduction in the timeliness of cross-border e-commerce export cargo logistics. Many respondents also mentioned that the unstable shipping schedule may lead to overseas warehouse demand. Dai Bin said, "In this case, overseas warehouses actually have opportunities, because sellers can stock up goods in overseas warehouses in advance. At present, in addition to the strategic direction to promote the development of overseas warehouses, customer demand is also an important driver for the booming overseas warehouses. One of the powers."

The so-called overseas warehouse is a warehousing supporting facility that serves export products and pre-consume goods in advance. At present, many foreign trade enterprises and cross-border e-commerce export enterprises have established "overseas warehouses" to optimize the overseas logistics system and solve the pain points of cross-border e-commerce.

A few days ago, the "14th Five-Year Plan for Digital Economy Development" issued by the State Council clearly mentioned that it is necessary to cultivate and expand a group of leading overseas warehouse enterprises and build a cross-border e-commerce industry chain and ecosystem. The data reported by the Ministry of Commerce shows that the import and export scale of cross-border e-commerce in 2021 will reach 1.98 trillion yuan, of which the number of overseas warehouses will exceed 2,000, and the total area of ​​overseas warehouses will exceed 16 million square meters.