Since this year, the international container market freight rate continues to rise, to the international logistics transport and trade has a huge impact.
By the end of August, China's export container freight index has reached 3,079 points, up 240.1% from the same period in 2020, more than double the record high of 1,336 points before the latest rise.
This round of price rises is broader. Before 2020, the increase in container market freight rates was mainly concentrated in some routes and some periods, but this time, the general rise, Europe line, the United States line, Japan and South Korea line, Southeast Asia line, Mediterranean line and other major routes increased 410.5%, 198.2%, 39.1%, 89.7% and 396.7%, respectively, compared with the end of 2019.
Freight rate rise 'unprecedented'
For this round of international container transport market hot, perennial engaged in industry research Ministry of Transport water transport research institute vice president Jia Dashan also laments "unprecedented".
In terms of demand, the global economy has continued to recover since the beginning of this year, and international trade has recovered rapidly, with demand for container transportation up about 6 percent compared with the same period in 2019, Jia said. China's situation is better, from June 2020, production and manufacturing and foreign trade exports to achieve continuous growth.
From the perspective of supply, the operation efficiency of ships has declined significantly due to the impact of COVID-19. Countries have stepped up efforts to prevent and control imported cases at ports, extended the berthing time of ships at ports, and reduced the turnover efficiency of container supply chains. The average increase in port time for ships is about 2 days, and for Ships in North American ports, it is more than 8 days. The decline in turnover has upset the original balance, leaving a supply deficit of about 10 percent compared to 2019, when the basic balance of supply and demand was slightly surplus.
The continuing shortage of crew is also exacerbating the shortage. The complicated epidemic situation in major seafarers such as the Philippines and India, coupled with crew shift change and quarantine, has led to a continuous rise in crew costs in the maritime market.
Disturbed by the above factors, the normal relationship between market supply and demand reversed rapidly, and container liner freight prices continued to rise sharply.
Statistics from UNCTAD, China's Customs and ports show that from before the outbreak to July this year, more than 80 percent of global trade was carried out by sea, while the proportion of China's imports and exports by sea increased from 94.3 percent before the outbreak to 94.8 percent now.
"According to relevant research, in China's import and export goods trade, domestic enterprises control the right to transport goods accounted for less than 30%, these enterprises will be directly affected by price fluctuations, most of the other enterprises are theoretically not affected by price fluctuations." Jia Dashan analysis. That is to say, the cost increase caused by the rise in freight rates will be directly transferred to foreign buyers, and Chinese enterprises will be less directly affected.
However, as an important cost of goods, the rise of freight will inevitably bring a huge impact on Chinese enterprises, mainly reflected in the decline of transportation services. Due to the decline of airline punctuality rate and the shortage of shipping space, the trade circulation of China's export processing enterprises is not smooth. Even if they can get orders for smooth production, they will also affect delivery due to poor transportation, thus affecting the execution of orders and production arrangements of enterprises.
"Small and medium-sized enterprises will be more affected." Jia Dashan believes that due to the lack of long-term cooperation guarantee, small and medium-sized enterprises mainly seek transportation services in the spot market, subject to bargaining power and transport capacity guarantee strength, in the current process of rising freight prices, they are facing the dilemma of "hard to get a box, hard to get a cabin". In addition, land-based ports and inland transportation organizations will also face additional delays and storage costs due to higher freight rates and lower on-time flight performance.
Boosting capacity is hard to cure
Spare container ship capacity has fallen to less than 1 per cent globally, according to The Maritime Market Research Institute, and almost all capacity, excluding vessels that must be repaired, has been brought to market. Many shipowners began to increase the shipping capacity to order the scale, but far hydrolysis can not near thirst, cargo owners reflect is still a tight capacity, a cabin is hard to find.
Zhu Pengzhou, a staff member at the Shanghai Shipping Exchange, said supply chains are called chains because the upper limit of the entire chain's capacity is usually affected by the short board effect. For example, reduced terminal efficiency, a shortage of truck drivers and slow unloading and reloading at factories are all constraints. Simply increasing the shipping capacity of liner companies cannot improve the overall shipping capacity of the logistics chain.
Jia Dashan agrees. In terms of demand, container transport demand increased by about 6% compared to the same period in 2019. In terms of capacity, capacity grew by about 7.5 percent over the same period. Thus, the mismatch is not due to a lack of capacity. The epidemic has led to an increase in uneven freight demand, poor collection and distribution, port congestion and reduced ship operation efficiency.
As a result, current shipowners remain cautious about investing in shipbuilding, with order capacity rising to 21.3 per cent of the existing fleet in August 2021, down from 60 per cent at the last shipping peak in 2007. Even if these ships are put into service before 2024, the relationship between capacity and volume will remain unchanged under the background of 3% annual growth in volume and 3% annual dismantling, and the market will continue to maintain high freight rates.
"Cabin hard to find" when to ease
Soaring freight rates are not only disadvantageous to trading enterprises, but also bring great risks and uncertainties to shipping enterprises in the long run.
International shipping giant CMA CMA has made it clear that it will stop the spot market rate increases from September this year to February 2022. Hapag-lloyd also said that measures have been taken to freeze rates.
"It is expected that the end of 2021 will usher in the market freight peak inflection point, then freight will gradually enter the correction space, of course, can not rule out the impact of the uncertainty of emergencies." Shanghai International Shipping Research Center chief consultant, director of the International Shipping Research Institute zhang Yongfeng said.
"Even if supply and demand fully recovers to 2019 levels, it will be difficult for freight rates to return to 2016 to 2019 levels due to the rising costs of various factors." Jia Dashan said.
Considering the current high freight prices, more and more shippers are inclined to sign long-term agreements and lock up freight rates, and long-term agreements are gradually increasing in the market.
Government departments are also making active efforts. It is understood that the Ministry of Transport, the Ministry of Commerce and other relevant departments have implemented active promotion policies in expanding container output, guiding liner companies to expand capacity, improving logistics service efficiency and many other aspects to ensure the stability of the international industrial chain and supply chain. (Reporter Qi Hui)