When will the container bid farewell to "a box is hard to find"?

  Since the beginning of this year, China's foreign trade situation has continued to improve, and the demand for international container transportation has grown rapidly.

However, the epidemic situation in many countries has continued to rebound, and some overseas ports have been congested, which has hindered the international logistics supply chain, and the efficiency of ship operations and the turnover rate of empty containers have dropped sharply.

  In the fourth quarter, has this phenomenon eased?

Are shipping prices still high?

Our reporter conducted a visit.

What is the container

"A box is hard to find"?

  At its worst, the gap in the volume of seaborne imports of empty containers reached 2 million TEUs.

  The container freight index of the Shanghai Air Exchange shows that on November 12, the comprehensive index of China's export container freight was 3,223.37 points, which was less than 850 points in May last year.

  Demand side

  A large number of foreign trade orders have been transferred to China.

According to data from the General Administration of Customs, in the first 10 months of this year, China’s exports were 17.49 trillion yuan, a year-on-year increase of 22.5% and a year-on-year increase of 25%.

  Supply side

  More than 96% of the world's dry freight containers and 100% of temperature-controlled containers are produced in China. Currently, manufacturing companies are increasing their productivity, but the number of companies engaged in container production is still small. The epidemic has disrupted the rhythm of container production.

  The port is congested and the shipping capacity is tight, making it difficult to find a cabin.

"A box is hard to find" continues

  On November 1, the five major shipping companies on routes between Asia and the United States collectively raised GRI (comprehensive rate increase surcharge). This is the 21st adjustment in freight rates for this route this year: the average freight rate for 40-foot standard containers has been adjusted within More than 1,000 US dollars, the total freight rate is more than 10,000 US dollars per box.

  Freight costs have soared, and the most impacted are low-value-added products.

According to a manufacturer of home improvement products in Yiwu, Zhejiang, a batch of orders made in April this year were originally planned to be delivered in June, but they were still stranded in the warehouse in November.

The person in charge of another Supply Chain Management Co., Ltd. said: "We have ample supply of goods, and we are struggling with not being able to get space and containers. At present, the boxes cannot be returned in many countries with severe epidemics."

  Jia Dashan, deputy dean of the Water Transport Research Institute of the Ministry of Transport, told our reporter that the “hard to find one box” of containers this year is reflected in two aspects.

  On the one hand, there is a lack of empty containers.

"my country's international shipping routes export heavy containers far greater than imported heavy containers. In order to maintain the balance of containers, 3 million TEUs of empty containers need to be transferred by sea every month, and at the same time, the balance of containers is achieved through domestic container manufacturing. The sudden epidemic has a greater impact on global trade. Last year, the demand for international container routes in my country dropped by 8%. As China took the lead in controlling the epidemic, a large amount of demand for cargo began to shift to China. Since the second half of last year, the demand for shipping increased rapidly, and the growth rate reached 14% in the fourth quarter of last year. The impact of poor circulation and the slowing down of empty containers in shipping has led to a shortage of empty containers. At the most serious time, the gap in the amount of imported empty containers by sea reached 2 million TEUs, and there was a'hard to find one box'." Jia Dashan analyzed.

  On the other hand, there is a lack of container space.

"The uneven increase in freight demand caused by the epidemic, port congestion and other issues have reduced the efficiency of ship operations, and the tightness of ship capacity has become prominent, especially in the spot market, which has led to a sharp increase in container liner freight rates. At present, the impact of the global epidemic is still continuing. The situation of port congestion and low ship turnover efficiency is difficult to reverse for a while, and a large number of new ships cannot be put into use at present, resulting in continued increase in shipping prices." Jia Dashan said.

  The container freight index of the Shanghai Air Exchange shows that on November 12, the composite index of China’s export container freight was 3,223.37 points. Although it was 1.6% lower than the previous period (November 5), the index was still in May last year. Less than 850 points.

  Previously, due to the relatively low shipping cost, the price was only 1/6 of that of air freight, and about 90% of the world's cargo was by sea.

According to data from the World Trade Organization (WTO), last year, the value of goods imported and exported by China through shipping reached US$2.5 trillion, which is higher than the combined value of air, rail and road transport.

Nowadays, shipping prices have soared, coupled with the related costs of cargo stranded in ports, shipping advantages are no longer obvious.

Some companies had no choice but to switch to air freight, with a single freight rate of up to millions of dollars.

The balance of supply and demand is broken

  "One box is hard to find" and what changes in international trade reflect behind the soaring freight rates?

What are the underlying reasons?

  Look at the demand-

  According to data from the General Administration of Customs, in the first 10 months of this year, China’s total import and export value was 31.67 trillion yuan, a year-on-year increase of 22.2% and a year-on-year increase of 23.4%.

Among them, exports were 17.49 trillion yuan, a year-on-year increase of 22.5% and a year-on-year increase of 25%.

Due to the better control of the epidemic situation in Asian countries such as China and abundant production capacity, many foreign trade orders have been transferred to China. China’s exports have grown rapidly and "pendulum shipping" has appeared, that is, full containers go to Europe and the United States, and empty containers go to Asia.

At the same time, the rebound of the epidemic in some countries has drastically reduced port workers and truck drivers, causing many ports to be unable to keep up with their capacity, causing backlogs and shortages of containers.

  From a global perspective, the recovery of container transportation varies greatly.

Jia Dashan said that compared with the first three quarters of 2019, the container throughput of the Port of Los Angeles, the Port of Long Beach and the Port of New York and New Jersey achieved growth of 15%, 25%, and 19%, which were significantly faster than the world average. One major reason for serious congestion in US ports; the recovery of major European ports has been relatively slow. Compared with the first three quarters of 2019, the container throughput of the Port of Rotterdam, Hamburg and Antwerp this year increased by 2.7%, -7% and 2.6%, respectively. Lower than the world average.

  Look at the supply——

  According to data from the British Drewry Shipping Consulting Company, more than 96% of the world's dry freight containers and 100% of temperature-controlled containers are produced in China.

Industry insiders pointed out that although China is the world's leading container producer, the number of companies engaged in container production is still small, and the epidemic has disrupted the rhythm of container production.

  In addition to the production itself, port congestion has also led to a shortage of containers.

According to data released by the Shanghai Air Exchange, in October this year, Los Angeles and Long Beach reached 11.3 and 10.6 days respectively when they stopped at the port. European ports such as Rotterdam, Antwerp, Hamburg and other ports generally stopped at the port for more than 2 days. The port of Shenzhen stays in the port for 2-3 days.

  Affected by the epidemic, the efficiency of related links such as terminal operations, seafarer shifts, dock workers shifts, related inspections and quarantine, and collection and distribution have decreased, breaking the original balance of supply and demand.

"Ships cannot be as good as fashion ships at the port of loading, and containers cannot be unloaded in time at the port of unloading. The overall effective capacity of container transportation is impaired, resulting in a shortage of ship capacity." Zhang Shouguo, executive vice president of the China Shipowners Association, analyzed this reporter.

  According to Wang Shiqing, general manager of Ningbo Huanyu Gangtong International Freight Forwarding Co., Ltd., global port congestion and lack of manpower are only part of the factors. The most important factor is the sharp increase in European and American procurement and the limitations of the port's own operations.

European and American ports are congested due to the large number of ships arriving at the port and the limited operating capacity of the port itself.

Within Asia, countries such as South Korea and Japan have also greatly lengthened the turnover time of goods due to the dual effects of relatively large export volumes and restrictions on transshipment ports.

Encourage the signing of long-term contracts

  Customs data shows that in the first three quarters of this year, China's container exports increased by 241.3% year-on-year.

In the fourth quarter, can container supply keep up?

  The China Container Industry Association recently stated that as Chinese container manufacturers increase their productivity and liner companies are speeding up the return of empty containers, the current monthly production capacity has increased from 200,000 TEUs in the past to 500,000 TEUs, the highest in history.

According to reports from major liner companies, the shortage of empty containers has basically been alleviated.

The inventory of new containers in China's major container manufacturers has exceeded 400,000 TEUs, and the supply of new containers is adequately guaranteed.

  On the main routes of mainland China, from January to August this year, the number of cabins invested by major liner companies began to increase significantly. Among them, the capacity of North American routes reached 9.11 million TEUs, an increase of 40.2% and 24.8% respectively over the same period in 2020 and 2019; The capacity of the Northwest Europe route was 5.67 million TEUs, an increase of 23.7% and 8% over the same period in 2020 and 2019.

At the same time, shipping companies have adopted measures such as changing bulk carriers to container ships, transferring ships from other routes to China routes, and manufacturing new ships, which effectively alleviated the shortage of containers.

  However, industry insiders pointed out that because there are still many backlogs in the country, the loading rate of container ships is still high, and it is difficult for the freight rate to come down in the short term.

  Relevant experts suggest strengthening the long-term cooperation in the supply chain transportation between cargo and ship.

Long-term contract customers are the "big heads" of container transportation, and many overseas cargo owners will sign long-term contracts to obtain transportation service guarantees at stable prices.

Zhang Shouguo gave an example: "At the beginning of this year, a Chinese company signed a long-term contract with a related shipping group. The price of each box is about US$2,600. Now the price of a single container has reached tens of thousands of US dollars. Therefore, we encourage the owners and shipping companies to sign Long-term contracts can not only protect the interests of both parties, but also stabilize market prices."

  Many parties are working together to strengthen the construction of the international supply chain logistics system.

Zhang Shouguo said that the international supply chain system includes shipping companies, ports, yards, warehousing, trailers, trains, traders, agents, and cargo owners.

The current supply chain is disordered, ship delays and capacity are tight, and the contradiction between supply and demand is prominent. This is mainly due to the increase in cargo volume, the insufficient capacity of the infrastructure of overseas ports and the rear collection and distribution system, and the combination of labor shortages and other factors.

All stakeholders in the supply chain should strengthen cooperation, strengthen the connection between the nodes of the supply chain, and coordinate the construction of a high-quality international supply chain service system.

  In addition, Zhang Shouguo suggested that according to different risk levels and port input crew capabilities, the implementation of refined and dynamic management of crew changes to and from the ship.

  "Considering the current high freight rates, more and more shippers are inclined to sign long-term agreements to lock in freight rates. The proportion of long-term agreements in the market is gradually increasing, which is conducive to stabilizing the supply chain." Jia Dashan said.

  Xu Peiyu