The prosperous situation of the container shipping market will continue for a longer period of time. The profit of the shipping company in the first quarter of this year is expected to increase to several times that of the fourth quarter of last year, and the profit in the second quarter will be equal to or higher than that of the first quarter.
After the Spring Festival, the congestion problem of European and American ports has not been relieved as expected. Instead, it has spread everywhere. Major international ports such as Los Angeles, Oakland, Rotterdam, Hamburg, Felice Du, Liverpool, and Le Havre continued to be congested. Singapore is not immune. Although the current shortage of containers has improved, it is estimated that as the volume begins to increase at the end of March, it will return to the original situation in April.
Jeremy Nixon, CEO of ONE, pointed out that Asian terminals currently operate 24 hours a day, while berths on the west coast of the United States work 112 hours a week, container terminals work 88-90 hours a week, and land operations are limited to daytime. Therefore, the current situation of the trans-Pacific route is unlikely to improve in the short term.
On the whole, the off-season of the shipping market after the Spring Festival this year is not weak. The number of days for seasonal correction of freight rates before and after New Year's Eve is between 50 and 64 days. The rate of freight rate decline is between 17% and 27%. After the festival, only 3.8% is revised, which is still obvious. Less than historical convention.
Looking forward to the market outlook, analysis institutions are optimistic about the market performance this year. Drewry predicts that the global container shipping demand growth rate will reach 10.9% in 2021, which is much higher than the 4.5% growth rate of supply.
The Danish shipping consulting agency Sea-Intelligence also estimates that the surge in freight rates may continue until the spring of 2022, and the freight rates for the US line may increase by another 25%.
Sea-Intelligence's research report pointed out that the current US retail industry inventory is still at a historical low, and the relative inventory level has been the lowest in 28 years. This is undoubtedly good news for the shipping company. As long as the sales situation is normal, the US retail industry needs to be in Continue to replenish inventory in the next few months.
Executives of CH Robinson, the world's leading third-party logistics service provider, pointed out that global road, sea and air cargo congestion is likely to continue into next year and continue to increase transportation costs.
Although there is still room for increase in freight rates, the various operating costs of container shipping companies are also increasing significantly. Port congestion has reduced ship turnover by 20% to 30%, and container ship rents have soared, which has doubled in the past year. In addition, the price of marine fuel oil has increased by 60% since November last year, and the difficulty in crew dispatch caused by the epidemic has also increased labor costs by about 20%.
Consolidation company believes that starting from May this year, the long-term freight rate of the western US route has started from US$3,000, which is several times higher than that of last year’s US$1,400. Therefore, as long as the freight rates of the European and Southeast Asian routes are stable, the company’s profit in the second quarter may be The first quarter is equivalent. If it is a consolidator that starts to substantially increase US flights in mid-March, there is still a chance that the second quarter will make more profits than the first quarter.
The spot freight rates for containers from Asia to Europe and from Asia to the United States fell further from record highs last week. However, it is expected to remain high for a period of time.
There has been a sharp drop during the Chinese Lunar New Year holiday, but the rate is expected to remain high
Jeremy Nixon, CEO of Japanese liner company Ocean Network Express (ONE), believes that the freight market will not stabilize before the middle of this year.
The Lowe's Daily said that in the absence of a sharp decline in traditional freight volumes after the Chinese New Year, the spot freight rates for Asia-Europe and Trans-Pacific trade are still at historical highs; the spot exchange rate flexibility during the Spring Festival shows that the factors that support price increases are still Need to be alleviated. Cargo backlogs, port congestion, equipment shortages and continued high throughput mean shippers are still being charged premiums on the main trade routes.
The Drewry Composite Index shows that although it has fallen 2.2% in the past week, it is still 232.6% higher than a year ago. The year-to-date WCI average composite index assessed by Drewry is US$5,231 per 40-foot container, which is US$3539 higher than the five-year average of US$1,692 per 40-foot container.
The Drewry Composite Container Index fell 2.2% (US$117) to US$5121.04 per 40-foot container.
The freight from Shanghai to Rotterdam dropped by US$286, reaching US$8188/FEU;
The freight from Shanghai to Los Angeles dropped by 130 USD, reaching 4,261 USD/FEU;
The freight rate of the 40-foot container from Shanghai to Genoa fell by US$106 to US$8,505;
The freight from Shanghai to New York rose by 23 dollars to reach 6,651 dollars/FEU.
Drewry expects rates to stabilize relatively this week.
The Ningbo Export Container Freight Index (NCFI) released by the Ningbo Shipping Exchange closed at 2152.91 points, down 4.1% from 2245.32 points last week. Among the 21 routes, the freight index of 5 routes increased, and the freight index of 16 routes decreased. Among the major ports along the "Maritime Silk Road", the freight index of 17 ports fell.
The freight rate of the European-German route dropped as a whole, 3.9% lower than the previous week's European route; the eastern route dropped 4.2%; and the western route dropped 4.9%. While the North American route remained high, the US East route rose 2.5% from last week; the US West route rose 0.2% from last week.
European-German route: In view of the fact that the transportation demand is still recovering after the holiday, the goods hoarded before the holiday have basically been shipped, and the booking price of the European-German route has dropped overall. According to Freightos' recent Baltic Index (FBX), the price of 40-foot containers from Asia to Northern Europe fell 4% a week to US$8004; according to FBX data, in the Far East to Europe transaction, the spot freight rate was as high as US$8,306. /FEU, but fell by US$432 over the weekend to US$7,874/FEU (daily index).
But for Mediterranean ports , the average price dropped by only US$37 last week to US$7,926 per 40 feet.
Moreover, many shippers are still obliged to pay additional fees to ensure the availability of containers, and for British ports, a "port fee" of US$2,000 is usually added. A year ago, the FBX index showed that the freight rates per 40 feet in the Nordic and Mediterranean regions were US$1,533 and US$2,130 respectively.
Lory Cheung, an overseas marketing expert at China-based MRF International Forwarding, said that shipping companies must “do everything they can to seize every opportunity” because the shipping market will eventually return to normal. He pointed out: "At present, carriers seem to be more willing to sign long-term contracts with BCO rather than freight forwarders," which shows that shipping companies are working hard to lock the contract price at the highest possible level to avoid the impact of spot market fluctuations.
In fact, the high inflation rate in current transactions is forcing shippers to cancel orders for low-value products. A British non-vessel carrier (NVOCC) stated that he has noticed that a garden furniture importer’s bookings from China have dropped by a third this year.
North American routes: The market's freight volume has recovered faster than in previous years, and the route's loading rate remains high. According to the Freeghtos Baltic Index, since the end of February, freight rates outside of Asia have decreased, and the spot freight rate for Pacific Eastbound transactions has dropped from a high of US$4922/FEU on February 26 to US$4197 on March 4. /FEU. However, by March 5, the spot freight rate soared again to US$4,709/FEU. At the same time, in the Trans-Pacific region, the West Coast portion of FBX in the United States fell 11% last week to $4,369 per 40 feet. Freightos expects this decline to be temporary, given the strong demand for trade.
The FBX index for US East Coast ports fell 3% to $5659/FEU.
Freightos research director Judah Levine said: "Although the rates are falling, they may remain very high for a period of time." "As the US retail inventory level is still very low, it may take until the end of this year to restore normal inventory."
According to the latest data from the signal platform of the Port of Los Angeles, the volume of inbound containers this week reached 175,300 TEU, an increase of 505.56% over the same period last year. There are 17 container ships berthing at anchorages, and 10 container ships waiting to be anchored outside the port, with an average waiting time of 7.5 days.
Last week, even if the freight rates of the two major trade routes from China to the United States and Europe fell, at least 35 to 40 ships were anchored on the west coast of the United States due to congestion in US ports continuing to spread to ports outside North America. More than twenty container ships waited for two weeks to berth. These container ships were loaded with exercise bikes, electronics and other highly sought-after imported goods. Los Angeles Port Director Gene Seroka said at a recent board meeting: "The backlog is expected to continue until midsummer."
Congestion in Southern California, dozens of container ships waiting to berth
Jon Monroe of Worldwide Logistics said that the traffic congestion in the Los Angeles/Long Beach area was mainly caused by the layoff of more than 700 skilled dock workers due to Covid-19 infection. "Due to the complexity of the operating models of multiple terminals in Southern California ports, this situation is more difficult to resolve quickly. Of course, in addition to this, 45% to 50% of imported goods in the United States are transported through the ports of Los Angeles and Long Beach." He added , The shipping terminal has insufficient storage space, the truck queue at the terminal is also very long, and the chassis continues to be short.
At the same time, Jon Monroe of Jon Monroe Consulting in Washington State suggested that there is evidence that the strong momentum of trade may be maintained until the Chinese New Year in 2022.
The market is unprecedentedly strong, which is bad news for shippers who are struggling to sign new annual contracts from Asia to the United States. "Many people I have spoken to have stated that this will be a fast negotiation," Jon Monroe said. "The question this year is more about'how to ship the product?' rather than'how much is the cost?'"
At present, there is a 40% unbalanced gap in containers in North America. This means that for every 10 containers that arrive, only 4 return, and 6 remain at the arrival port. The average monthly trade between China and the United States is 900,000 TEU, and there is indeed a huge absolute imbalance in containers. In addition, according to the data of consulting company Descartes Datamyne, the current shipment volume is at the highest level in history. In the first quarter of this year, sales increased by 23.3% over the same period last year.
The container shipping crisis has affected various business areas in different ways. For example, the transportation of high-value commodities such as mechanical engineering products, electronic products and computer equipment will be less affected. But for other types of goods, especially the textile industry in Asia, the increase in transportation costs has brought more serious consequences. Exporters claim that the sharp increase in freight rates has led to the closure of many low-profit textile mills. Delays and container shortages are pushing up freight rates. In Asia, delivery delays can be up to several weeks, forcing many companies to negotiate price increases with buyers.
When goods are transferred around the world, they rarely go from departure to destination locations in one step. In fact, they may switch between air, ocean, land, and rail carriers before they reach their destination.
Freight forwarders do the work of organizing, planning, and optimizing global trade routes and logistics solutions to facilitate the movement and storage of those goods. They rely on an expansive network of transport vehicles, warehouses, and intermodal points to streamline the movement of goods and cargo across the whole world.
Freight forwarders and logistics companies gather information from shippers, warehousers, truckers, and more to plan the route cargo will take. When they need to incorporate a shipment, an optimized route is already available and ready to utilize.
International Freight Forwarding Services
International freight forwarding services helps ensure an uninterrupted supply chain for international shipping partners. International logistics include foreign customs, duties, regulations, and fees, that are constantly changing and being updated.
It is important for freight forwarders and logistics companies to carefully handle such processes and stay up to date on issues related to global transport. These things can change from day-to-day, and shippers should be aware of cost fluctuations, new regulations, or procedures at both destinations and departure points.
Cost
A shipping company handles transportation services for you, but an industry-leading freight forwarder can help you optimize your time and money. Freight forwarders incorporate your supply chain into an existing and strong network of shipments.
Asiana USA provides door-to-door transportation and logistics services that are meant to reduce overall costs. Our advanced and integrated shipping network allows us to optimize the movement of goods around the United States and the world.
Services
Freight forwarding services include tracking inland transportation, document preparation, warehousing, negotiating fees, insurance, cargo consolidation, and shipping. These services greatly improve shipping for the shipper, receiver, and freight forwarding company.
Ideally, you should seek a partner who can perform all of these services. If you use more than one or all of these services, this will optimize your supply chain and shipping experience overall.
Mode of Transport
The best freight forwarding service providers make use of all modes of travel. Optimizing shipping routes using land, rail ocean, and air freight allows for an extended network of travel to and from multiple intermodal drayage points.
Drayage shipping means that cargo is moved between major intermodal points using high-volume transport such as a ship or train. Then, smaller vehicles will move them to the cargo to its final destination.
Trucks are an efficient way to move cargo and single containers between drayage points. While long-haul trucking has often been used to transport containers long distances, this practice is being replaced by drayage trucking, and other modes of transport are used for longer transport.
This is a safer alternative and more efficient, as truckers can make multiple trips daily. Additionally, truck companies have been incorporating new technology to further optimize the trucking experience, such as automatic transmissions and multiple cameras.
Rail transport is a far more efficient way to move multiple containers long distances. Instead of one driver per truck per container, a train can move over 200 double-stacked containers, use far less energy, and require far less personnel to operate.
It’s a safer, more effective way to move large goods long distances. Using one train where 100 trucks would have been needed also creates less pollution.
Air freight is used for more time-sensitive shipments. As transporting cargo by air poses weight and size restrictions, it is better used for smaller cargo. Due to high demand and higher fuel costs, air travel may be less suitable for heavy supply chains.
However, when cargo needs to travel far overnight, air freight can usually be the best option. Other situations where air freight is preferable is if you are shipping perishable, sensitive or hazardous items where special handling is required.
The majority of shipping occurs via the ocean. Ships carry large container loads and optimize shipping routes between major global trade ports. Transporting large amounts of cargo between major ports all over the world by ship allows for the rest of the shipping industry to flourish.
Over 11 million containers arrive yearly at different ports in the United States, many of which continue their journey by land to different parts of the country.
Final Thoughts
Choose a freight forwarding service that helps your business perform better by optimizing your supply chain, reducing your shipping costs, and deals with complicated international paperwork for you.TJ China Freight provides the best solution and the timely feedback for all kinds of shipment from every city in China by sea, by air and by railway, and we can provide the competitive price based on the best service, meanwhile we can also provide the other best service, including customs clearance, pick up & delivery service, shipping to Amazon FBA, warehousing & Distribution, cargo insurance, container loading supervision and Express,In a Word, everything you want to ship from China, TJ China Freight can always help.
Contact Info
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1. Sea freight is available for FCL (full container load), LCL (less than container load). The United States is divided into ports for the West Coast, East Coast and Gulf Coast.
East Coast: NEW YORK,SAVANNAH,MIAMI,HOUSTON,etc.
West Coast: OAKLAND, LONG BEACH, SEATTLE, WA, LOS ANGELES, etc.
Gulf Coast: TEXAS, LOUISIANA, MISSISSIPPI, ALABAMA, and FLORIDA.
2. Air freight comprises a program of scheduled and deferred services from China with coverage via all major airports. Shipping from airports of Hongkong, Shenzhen, Guangzhou, Shanghai, Beijing, Xiamen to all international airports in the USA.
3. Air Express/Couriers services will ship your cargo from China to your US office or home address. And package forwarding service is actually FREE for you. We can get more than 50% discount prices from DHL, UPS, TNT, FedEx, EMS, but better than their services.
4. The Dedicated Shipping Line. Door-to-door services from China to the USA which is DDP shipping. But this shipping channel only receives carton packages. Not accept Anti Dumping products and Sensitive products. Amazon businessmen like this shipping way: Easy-Cost-Effective.
How Long To Ship From China To The USA?
1.Sea Shipping to the West coast is about 13-15 days, to the East coast is generally 23-25 days. 2. Air Shipping to US AirPort is generally 2-5 days, depending on which airline company your choose. 3. Courier services is about 3-5 days. 4. The Dedicated Line is about 8 working days.
How To Get Shipping Freight From China To The US?
Be sure to get the info below from your China supplier, which is very important for our customer services in order to give you the accurate quotation price: 1. Name of commodity and HS CODE 2. Estimated Shipping time 3. Place of delivery 4. Weight, Volume and packages way 5. Trade mode: FOB or EXW 6. Value for the commodity 7. To Door or to Port
What Special Considerations You Need To Know?
1. Full Container Shipping
20GP: Not more than 17 Tons.
40GP/HQ: Not more than 19 Tons.
2. Less than Container Shipping
Chargeable Weight:1CBM=363KG (Special in the United States)
If Weight/Volume > 363kg/m3,use weight number as the chargeable data
If Weight/Volume < 363kg/m3,use volume number as the chargeable data
3. DDP Shipping-How to calculate tariff in America?
HS Code of product.
Government Website: http://hts.usitc.gov/
Other tariff: HMF(0.125%) and MPF(0.3464%) of value
4. Customs Bond
If you don't have Customs Bond in the US you can ask customs brokers to purchase. Two types:
Single Entry Bonds: Only for one shipment
Continuous Entry Bonds: Over a whole year
If you want us to handle that we can use our bond to help do clear in the US.
Our Commitment
Choose and believe TJ is your right decision.Hope we can work together for a long time.
We treat you as a valued customer regardless of your size or needs.
We ensure fast transits, export clearance and competitive rates.
We are consistently able to offer individual、professional service and suggestion to all our customers.
We are familiar and have a deep knowledge of China’s export policies and special requirements.
Our experienced brokers can assist and accelerate the most challenging cargoes to ensure successful customs clearance.
Whether you need your goods from Port to warehouse or from warehouse to the far side of China or All over the world. Our transporters are ready to go!
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We have been working with Tj China Freight for three years. Sometimes full container, sometimes LCL, they have NOT ever let us down. Now we are growing rapidly. Let’s work together for the next three years.
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German logistics giant Rhenus continues to start crazy "acquisitions"! Following the acquisition of the LOXX Group last month, Rhenus, the harvester in the international freight forwarding market, has taken another move, bringing BLG Logistics Group, a well-known local freight forwarding company in Germany, under its umbrella.
Rhenus Group is a leading logistics service provider in Germany, with operations all over the world, with an annual turnover of 5.5 billion euros. Rhenus has operations in 750 regions around the world and has 33,000 employees. The Rhenus Group provides solutions for different areas in the entire supply chain; including multimodal transportation, warehousing, customs clearance and innovative value-added services.
BLG hopes to focus on its contract, automobile and container businesses, and sell BLG International Forwarding's international freight business to Rhenus. Since 2018, Rhenus has acquired almost all regions of the world; Rhenus will provide its service network for the rest of BLG's business .
Rhenus will take over BLG’s 9 air and sea freight stations in April and integrate these stations with approximately 100 employees into its network of 12 branches in Germany. This new business will enable the company to handle more traffic through its LCL hub in Hilden and the air cargo hub in Frankfurt.
Rhenus said the company also plans to expand its food business, trade fairs and event logistics operations. "In the past few years, we have paved the way for the continuous expansion of air and ocean freight," said Stefan Schwind, general manager of air and ocean freight at Rhenus Germany.
"Due to the addition of business sites, employees and business activities, we are consolidating our network in the German aviation and maritime sectors. We also hope to develop new business areas, such as the use of refrigerated containers to transport food, and in trade fairs and event logistics. Activities."
BLG said it will retain its freight forwarding business in Bremen, focusing on land and sea transportation of heavy and project cargo. Board member Jens Wollesen said: "Even if we no longer have representatives throughout Germany in freight forwarding, we will continue to provide a wide range of international services in our contract, automotive and container sectors."
Last month, Rhenus stated that it would take over the LTL and FTL cross-border specialist LOXX Group and established five business sites in Germany and Poland to strengthen its business in Germany and Europe.
In the past two years, Rhenus has made frantic acquisitions. From Germany, Italy, the United Kingdom to Canada to South Africa and the United States, all freight forwarding companies that Rhenus favors have been acquired.
Recent "acquisition list":
In November 2018, it acquired German freight forwarding SBL;
Acquired the Italian logistics company Cesped in December 2018;
Acquired British freight forwarding Core Management logistics in January 2019;
Acquired Rodair, a Canadian freight forwarder, in early March 2019;
Acquired World Net Logistics, a well-known freight forwarder in South Africa at the end of March 2019;
Acquired LOXX Group in January 2021;
Acquired BLG Logistics Group's freight forwarding in January 2021.
Dominic Hyde, Vice President Crēdo On Demand at Peli BioThermal, discusses the developing trends in freight that have come about as a result of the COVID-19 pandemic.
Previous predications in pharmaceutical transportation trends, highlighting declining air passenger numbers and increasing air freight demand, have all been propelled by the pandemic. Coronavirus continues to cause worldwide disruption and is anticipated to impact industry throughout 2021 and beyond.
Pandemic response - preighters take off
Pre-pandemic passenger numbers were already on the downturn. However, the crisis has significantly accelerated that trend and the crisis capacity crunch came as the number of passenger flights plummeted. The ensuing scramble to transport pandemic payloads saw the deployment of hundreds of passenger planes as freighters, known as ‘preighters’.
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Pioneering Portuguese charter operator Hi Fly led this trend, being the first to convert an A380 for freight by removing the majority of seats
Pioneering Portuguese charter operator Hi Fly led this trend, being the first to convert an A380 for freight by removing the majority of seats to provide more cargo capacity. Despite the sector seeing the grounding of hundreds of passenger planes, earlier than had been initially forecast, which led to a reduction in the availability of cargo space, we’ve seen more planes undergo such conversions.
However, the ongoing drastic downturn in travel means the loss of a lot of capacity in passenger aircraft, and while freighter aircraft are still present and working hard, fleet growth takes time, so there will be a slower response to replacing some of the capacity lost from the passenger side of the industry.
Large widebody aircraft – grounded or retired
Before COVID-19, it was predicted that airlines would cut flights from schedules, mothball larger aircraft, decline production options, and look to utilise smaller, more efficient aircraft – whether for environmental or economic reasons. All those decisions have now been massively accelerated. The forecast to park some of the larger, widebody aircraft has been brought forward significantly due to the COVID-19 crisis, and its ongoing impact has meant the majority of all 747 freighter aircraft have or are being retired. The A380, which Airbus had previously announced it would stop deliveries of in 2021, has also been retired across the board by numerous airlines.
Increasingly, airlines are grounding their A380s in favour of more modern, smaller jets that can fly more efficiently than their four-engine aviation counterparts.
What we will continue to see is a lot more interest in leaner aircraft, such as the A220, the Canadian Bombardier aircraft produced by Airbus in North America.
Sea change in modes of transport
There will be ongoing developments in the sea freight sector too, which has an estimated 17 million TEUs (Twenty-foot Equivalent Unit) serviceable globally, of which six million containers are routinely turning and carrying freight.
Uncertainty in sea and air freight availability saw pharma companies initially ship everything they could, by any mode of transport available, to get it out to the markets. Following months of disruption, passenger airlines began loading aircraft with cargo in the lower decks and loose load cargo on the upper decks.
Whereas I was hoping things might be back to some kind of normality in March, I am now inclined to add another quarter to that. I now think there will be exacerbated sea freight and sea container availability issues throughout the first half of 2021.
Given the sea freight situation, we will continue to see the utilisation of air freight to transport pandemic payloads. When it comes to economics, without the passengers on the main deck is a much more expensive operational option. However, pharma customers are prepared to pay those premiums.
The volumetric efficiency on aircraft is critical at the moment because it is such a scarce resource. We need to ensure the best use is made of it. With air freight capacity a dwindling resource, it is even more important to have the efficient packing density of temperature-controlled products on such limited air freight resources.
Vaccines vs. virus - rapid response
As the development of successful COVID-19 vaccines continues, approved vaccines are already being administered as part of ongoing mass vaccination programmes worldwide. Temperature-controlled packaging manufacturers continue to play a pivotal part in the global deployment of these, but as COVID-19 vaccines fall into different families of technology, some have frozen and deep-frozen temperature requirements, leading to a scramble to qualify existing solutions for shipping at those specific lower temperatures.
In a rapid response to the logistical cold chain challenges involved, we have adapted our shippers to meet those requirements, as have other providers. There has been an impetus for innovation to support these temperatures in volume. Suppliers stepped up to meet the vaccine temperature challenges by adapting existing shipping solutions. The capacity is there, so I don’t anticipate it will be an issue going forward.
The focus is reverted back to the capacities in the transport modes and – given the nature of these drugs – people are paying whatever it costs to ship them, with rates rising sharply from $2.5 a kilo to $23 – although, that is starting to calm down.
Beyond the current vaccines being approved there will be the need to provide boosters. It is going to create a recurring step up in the volume of vaccines being shipped, alongside the flu vaccines being transported and other pharmaceutical payloads every year.
There will not be a continuous crisis. There will rather be a continuing trend for smaller aircraft with reduced air freight capacities moving pharmaceutical products at temperatures that sea freight cannot do. It really can only fly.
However, there’s not going to be a modal shift from air to sea because sea cannot meet the temperature requirements. You get a displacement, whereby COVID-19 shipments, whether vaccines, test kits and reagents, or some of the therapies which help with recuperation, are flying at almost any cost on a dwindling resource.
The pharmaceuticals, which have more normal temperature shipping requirements, get displaced. In that situation, when the air freight rates get so high, sea freight would normally be seen as a shipping solution.
However, with all of the sea freight challenges, coupled with the fact that their transportation rates have also doubled, there has been some displacement – although not as much as pharma companies would have liked, which is what has kept pushing the prices up in the region of the $23 a kilo figure for air freight we had seen previously in the market.
Sea freight will improve in the first six months of 2021, so some of that displacement can take place more efficiently. Aircraft, however, will still be loaded with COVID-19 related products.
2021 will see the industry learning to operate in ‘the new norm’. Next year, we might start to see some improvements and efficiencies, but I think this year is about adjusting our planning, our capacities and our operations around this spike in demand and the gradually improving capacity picture. Almost like wearing in a new pair of shoes.
Aerial photography of Southern California full of container ships! Terminal operators expect to get rid of the dilemma by the end of spring
Recently, a cold wave swept the United States and quickly plunged the southern state of Texas into disaster. In this unprecedented cold wave, more than 4 million people in the United States have suffered power outages, countless power plants have been destroyed, and electricity and natural gas prices have skyrocketed. ; At present, the price of electricity in Texas has increased by more than 100 times, up to 9,000 US dollars per megawatt, and the price of natural gas has skyrocketed by more than 160 times, reaching US$500, compared with only US$3 in the past; it is jaw-dropping.
Except for Texas, which is in a serious disaster, other states in the United States are not doing well. There are about 168 million people in the United States under the threat of this cold wave. Numerous airports have been suspended. According to data from the flight monitoring website "flightaware", Dallas and Houston , Austin area airports have cancelled more than 2,000 inbound and outbound flights on the 15th . Coupled with the new crown pneumonia crisis that is still raging across the United States, the United States is really miserable.
In terms of shipping, the Southern California anchorage is full of container ships, and the congestion continues to worsen ! The latest video released by the U.S. Coast Guard provides intuitive evidence of the congestion levels in Los Angeles and the Port of Long Beach. From the picture, a large number of container ships are moored at the anchorage in San Pedro Bay, California.
U.S. Coast Guard aerial scene
Data shows that the historic container ship congestion in California ports has not really eased. There are currently 63 container ships in Los Angeles and Long Beach, and 32 container ships are waiting for berths at anchorages. (On February 1st, the highest record of 40 container ships anchored at anchorage)
The Port of Los Angeles announced the number of berth days for a particular container ship through its Signal platform last week. Data shows that some ships stay at anchorage and wait for almost as long as they sail across the Pacific Ocean . For example, as of last Thursday, the 6332TEU container ship "Ever Envoy" has been parked for 11 days. As of Tuesday, the 9,400TEU "MSC Romane" has been parked for 12 days. And the three container ships of 11356TEU "CMA CGM Andromeda", 8452 TEU "Ever Liven" and 4888TEU "NYK Nebula" also berthed for 11 days as of last week.
As of the end of 2020, the number of container ships at anchor has increased to 30; since then, it has remained between 20 and 40. At the same time, the number of vessels at berths in Los Angeles and Long Beach remained at around 20 and 30. Kip Louttit, executive director of the Southern California Shipping Exchange, said: "We seem to have adapted to the new normal of about 30 container ships waiting in line every day. I don't know if this situation will continue."
As of Tuesday, the average time for ships docking in Los Angeles was 8 days , up from 7.3 days at the beginning of last week. From the information on the waiting time of ships provided by the platform from January 27th, the waiting time for ships to berth has been maintained for about one week, and the data for the last two periods has been extended to 8 days.
The latest data from the Signal platform: 20 ships at anchor, with an average anchoring time of 8.0 days. There are 14 ships waiting to be pre-anchored.
What caused the blockage? The extended berthing time of ships forced some shipping companies to cancel multiple voyages this month. This is not due to lack of cargo demand, but due to lack of available vessels to handle these services. Delays on land have also caused congestion at sea: extremely high inbound volumes and complex logistics inside and outside the port have caused delays on land. One of the challenges facing the port is the new crown virus infection of dockers and a serious shortage of labor.
Despite productivity gains last month, terminal operators at the Ports of Los Angeles and Long Beach said the ports may have to wait until the end of spring to get rid of the ship backlog and congestion that have plagued them in the past six months . The near-record number of containers will continue into the spring of this year, but the backlog of ships at the port and the fully loaded inbound containers at the terminal should disappear sometime between April and June.
The managers of SSA Marine, Yusen Terminals and Fenix Marine stated that in order to alleviate the congestion in the port, two projects to be developed are necessary. First, the COVID-19 vaccine must be widely distributed among dock workers to alleviate the recent labor shortage. During the Lunar New Year holiday this month, container traffic has declined moderately, which should also enable shipping terminals to remove the backlog of fully loaded imported containers from their facilities.
"The terminals are full and there is no place to put these containers. We deliver 35% less cargo (to truck drivers) than usual," said Ed Dannick, president of SSA Containers.
According to data from the HarborTrucking Association, the average truck stay at the terminal in January improved from 93 minutes in December to 88 minutes, but it was still much higher than the record low of 58 minutes in June. Imports peaked during the recovery period after the first wave of COVID-19 lockdown.
The backlog of ships in Long Beach, Los Angeles, is increasing unabated. According to statistics from the Marine Exchange of Southern California, there are currently 63 container ships in the Port of Long Beach in Los Angeles, of which 32 are at anchor waiting for berths and 31 are at berths.
The latest data released by the Pacific Merchant Shipping Association (PMSA) shows that in December last year, the average container stay time at the 12 terminals of the Port of Long Beach in Los Angeles was 4.99 days. This is twice the average length of stay (approximately 2.5 days) recorded by PMSA in the first half of 2020.
“The longer the container stays at the terminal, the more serious the congestion will be. When the container piles up like a mountain, the congestion creates additional and inefficient handling requirements,” said PMSA’s government affairs manager jessicaalvarenga.
The new crown epidemic hits labor in the port
According to the Pacific Maritime Association (PMA), the West Coast port employers' Association and the International Terminal and Warehouse Union (ILWU), the new crown epidemic has severely affected the labor force along the Los Angeles-Long Beach Port. As of January 17, The International Terminal and Warehouse Union (ILWU) reported that 694 of its members tested positive. By January 25, this number jumped to 803.
PMA stated that there is a particular shortage of skilled equipment operators, who need to remove containers from trucks, and then move them into and out of the container yard, which is critical to the operation of the terminal. As a result, the joint committee of PMA and ILWU, which is responsible for allocating workers to the docks on a daily basis, cut the allocation share.
"It boils down to the labor issue at the terminal," said Scott Weiss, vice president of business development at Port Logistics Group, which has a large number of truck and warehouse operations throughout Southern California. "Containers still have bottlenecks in and out of the terminal."
The latest information released by the Signal platform of the Port of Los Angeles shows that due to the new crown epidemic, the productivity of coastal labor has decreased, which has caused ship delays and the average delay of port facilities is 8.0 days .
These ports are working with trans-Pacific shipping companies to reduce Southern California's load until the volume returns to normal. Gene Seroka, executive director of the Port of Los Angeles, said that he is working with shipping companies and terminal operators to "measure" imports until the port catches up. Hapag-Lloyd (Hapag-Lloyd) has announced the opening of a structured route to Southern California in February, and CMA CGM will remove Los Angeles from the trans-Pacific route and use Oakland as the first port of call from Asia. , Followed by Seattle-Tacoma.
The terminal operator said that when workers throughout the supply chain are vaccinated and imports drop, the congestion in Long Beach, Los Angeles, will disappear.
Spring recovery?
Alan McCorkle, President and Chief Executive Officer of Yusen Terminals in Los Angeles, said that in the past six months, the container throughput of these terminals was close to record levels, but there was no overall congestion. This fact shows that if the peak season does not last for six consecutive months, they will have Ability to handle peak season cargo volume. He expects to return to normal in May or June.
Scott Schoenfeld, general manager of Fenix Marine Services in Los Angeles, said that Fenix is showing signs of improvement, so he is optimistic that congestion may be eased as early as April . The density of containers in the yard is not as high as late last year, and more truck drivers are able to transport containers every day.
However, container traffic is still rising, and as overloaded ships continue to arrive in Southern California, this trend will continue until at least next month. NVOCC consultant Jon Monroe said that the eastbound transpacific shipping company has deployed or will add 10 additional loading vessels in February, all deployed at the Port of Los Angeles-Long Beach. Judging from the latest data from the Los Angeles Signal platform, there was another peak in the surge in volume in the eighth week.
Volume surged in the eighth week
Jon Monroe pointed out that although more Chinese factories will continue to maintain at least part of their business this month to clear the backlog of merchandise orders compared to previous years, the total volume of the East Pacific trans-Pacific region should be greater than the previous six months. Months are less.
Scott Weiss, vice president of business development at Port Logistics Group, said that the 1.8 billion square feet of industrial and distribution space throughout Southern California is not fully loaded, just like last fall before the holiday season merchandise was transferred to stores across the country. However, the availability of space in warehouses and distribution facilities has been mixed. "Some warehouses are in a mess now, others are working well. I think the ratio is about 50-50,"
Scott Weiss said that productivity has generally declined, and warehouses across the region are experiencing labor shortages due to the new crown epidemic, but at the same time, freight volumes are still exceptionally strong. "Everyone I contacted is experiencing record sales and growth, but everyone is working hard to cope."
Weston LaBar, CEO of the Port Transportation Association, said that the current truck capacity is tight, and the availability of workers at both ends of the truck driver's route, the terminal and the distribution warehouse, has been challenged . However, when workers feel safe, they return in large numbers. LaBar said: "The most effective thing we can do right now is to vaccinate."
1. "Consolidate" is the English word for LCL, which is referred to as "consol" in international trade and transportation.
2. LCL cargo generally cannot accept the designation of a specific shipping company. The shipping company only accepts the booking of FCL cargo, and does not directly accept the booking of LCL cargo, only through freight forwarders (individual strong shipping companies through their logistics The company) can book the space with the shipping company after consolidating the LCL cargo. Almost all LCL cargoes are transported through the “centralized handling and centralized distribution” of the freight forwarding company. The LCL distribution ports in East China are basically It is the port of Shanghai. General freight forwarders can only book space from a few shipping companies due to the limitation of cargo sources, and they rarely meet the needs of designated shipping companies. Therefore, when transacting LCL cargo, try not to accept designated shipping companies to avoid consignment Time can not meet the requirements.
3. When negotiating transactions with customers, pay special attention to the relevant transportation terms, so as not to find out that the transportation terms cannot be met after the other party's letter of credit is issued. In our daily operations, we often encounter L/C regulations stipulating that LCL cargo transportation does not accept freight forwarders’ bills of lading. Because shipping companies do not directly accept LCL cargo bookings, shipping companies’ ocean bills of lading are issued to freight forwarders, and freight forwarders re Issuing HOUSEB/L to the shipper, if the L/C regulations do not accept freight forwarding B/L, there will be no choice when the actual transportation is handled, which will cause L/C inconsistency. Another example, when we handled the transportation, we found a consignment note stating: Goods must be shipped in container on LCL basis and Bill of Lading to evidence the same and to show that all LCL. handling charges, THC and delivery order charges at that port of discharges are prepaid. It can be seen from the original text of the above paragraph of L/C that the consignee has passed all the expenses that should have been borne by him to the consignor. This is because the consignor and the customer did not negotiate in detail on the terms of transport during the trade negotiation. To.
4. The billing tons of LCL cargo shall be accurate. Before delivery of LCL cargo, the factory should be required to measure the weight and size of the goods as accurately as possible. When the goods are delivered to the warehouse designated by the forwarder, the warehouse will generally re-measure, and the re-measured size and weight will be charged. standard. If the factory changes the packaging, the factory should be required to notify in time. Don’t wait for the goods to be delivered to the freight forwarder’s warehouse and feed back the information through the forwarder. Often time is already very tight. If you change the customs declaration documents, it is easy to delay customs declaration or incur expedited customs declaration fees. And port charges.
5. In some ports, due to insufficient supply of LCL and high cost, freight forwarders specializing in LCL adopt the lowest charging standard for goods with a small volume. For example, the minimum is 2 freight tons, that is, less than 2 freight tons. All charges are based on 2 freight tons. Therefore, when the volume of cargo is small, some of these factors should be taken into consideration when the cargo is transacted at the port to avoid passiveness in the future.
6. For some routes and ports that are relatively remote, and customers propose to deliver LCL goods to inland points, it is best to consult before signing the transaction and confirm that there are shipping companies and freight forwarding companies that can handle these remote ports and inland points. Sign the contract after delivery and related expenses.
Summary of common problems in LCL customs declaration
The same foreign customer buys goods from different suppliers in China and then they are assembled into a cabinet and shipped to foreign customers. Sometimes two or three companies fight together, sometimes seven or eight companies fight together. In this case, it is usually a case of customs declaration. , To talk about common problems in customs declaration.
1. Customs declaration method-agent declaration and pay declaration
Because customers purchase from 3 or 4 different factories, some foreign customers find factories that do not have import and export rights for cheaper prices. Although the prices are cheap, they do not have customs declaration documents and need to pay for customs declaration. Therefore, at this time, there will be some agent declarations in the supplier, and some need to pay for customs declaration, especially for goods that require commodity inspection. Therefore, at this time, it is recommended that the goods with documents and the goods with documents are put together in a cabinet, and the goods that pay for customs declaration and pay for customs declaration are combined. Try not to have AB orders, some agents declare and some pay, that is, there are goods that need to be declared in a cabinet, and there are goods that need to be inspected but cannot be inspected and must be paid for declaration, because most ports do not support AB orders A few in the Pearl River Delta, such as Huangpu, Yantian, and Shekou, support AB orders.
2. Destination country
Some of the suppliers of the consolidation are required to declare customs for tax refunds, some do not require tax refunds for general trade small write-offs, and some require commodity inspections with customs clearance forms. At this time, we must pay attention to the customs declaration information of different suppliers. The destination country must be consistent.
There are often two situations. 1. The information to be refunded is more detailed, and the actual destination country is written, and the destination country for small verification of non-refundable tax is just typed. The destination country of the customs declaration data is different. 2. When going to Russia and waiting for some inland points, the unloading port is Poland, and the railway transfers to Russia. At this time, some of the customs declaration documents are written in Poland and some are written in Russia. Lead to inconsistent destination countries. At this time, the destination country Russia is always written, and Poland is only the port of discharge, not the final port of destination.
3. Value
When the cabinets are assembled, the value of each is different. For example, there are three stores A USD4W, B USD4W C, USD 3W
The value of the respective goods does not exceed 10W, and each does not need special export invoices, but because the total value of the goods exceeds 10W or 8W (depending on the port), some ports need to provide value-added tax invoices. I don’t understand the value of other factories. Sometimes the value-added tax invoice may not be mailed.
When the cabinets are assembled, the value of each is different. For example, there are three stores A USD14W, B USD4W C, USD 3W
The total value of the goods exceeds 10W US dollars. As A himself exceeds 10W, A also needs to provide special export invoices. Others only provide value-added tax invoices.
Fourth, the number of LCL
Generally speaking, the number of cabinets assembled will not exceed 8 pieces. In some places, it is 4 pieces. If a supplier purchases from more than a dozen factories, just a dozen factories have customs declaration materials, and this time it will be more than a dozen. Customs declaration materials are combined together for customs declaration. Generally, the customs support no more than 8 fights.
Five, the difference between tax refund and non-refund
There are three suppliers, two of which require tax refunds, and one does not require tax refunds. The total value of the goods exceeds 10W. Previously, only two factories that needed tax refunds would provide value-added tax invoices and special export invoices. Now, on the original basis, they also need non-tax refundable factories to provide Special export invoice.
Sixth, the issue of door closure
As there are more goods, to prevent confusion during customs declaration and inspection, it is best to remember what goods are loaded at the door of the cabinet.
Seven, put together a few cabinets
Sometimes the supplier has more goods and may have to install 2 cabinets.
1. At this time, pay attention to loading the goods of the same company in one container, don't pack A in several squares and B in several squares. If you are not satisfied, you must install two containers separately, and make one more copy of the customs declaration information.
2. Commodity inspection needs to correspond, such as ABC three, A has 70 cubic meters, B has 18 cubic meters, and C has 8 cubic meters. The large cabinet has 50 cubic meters for the A family, 18 cubic meters for the B family, 20 cubic meters for the A family and 8 cubic meters for the C family. When doing commodity inspection, A must do two commodity inspections.
3. Even the counter or separate reports. One of the cabinets was checked during customs declaration, but the other was not checked. Because the cabinets were connected, both cabinets could not be boarded. When reporting separately, those who are inspected will continue to check and wait for the next water, and those who are released can board the ship.
In the container transportation business, we call a container, an exporter, a consignee, and a destination port, and the goods that meet these "four ones" conditions are called FCL, and we call a container, exporter, and consignee. As long as one of the three items in the port of destination is two or more export goods, it is defined as LCL cargo.
The transportation cost of LCL and FCL is very different in terms of procedures, time and cost. The two are by no means "1+1=2, 1+2=3". Similar to the simple relationship between addend and sum, it is a series of strange "inequalities" such as "1+1>2, 1+2>3".
The customs clearance procedures for LCL cargo are more complicated than FCL cargo, and it takes longer
First, the whole container of goods exactly meets the minimum unit of customs inspection, sealing, and release of the exporting and importing countries. For a batch of goods, as long as the documents submitted by the exporter and importer are reasonable, legal and intact, the export customs and import customs will handle it. After the relevant procedures and relevant taxes and fees are collected, customs clearance will be released soon. The LCL cargo will not be so simple and fast. As long as the goods in the container have a single shipment document that is faulty, the export customs will not release the goods. This is because the export customs must seal the exported containers before allowing the loaded containers to leave the country. Therefore, in the same container, the failure of any one of the goods to clear customs will inevitably affect the timely export and transportation of other goods.
Second, LCL cargo is far less extensive and flexible than FCL cargo. It requires additional solicitation by the transportation company and a reasonable combination of some conditions such as the port of shipment, port of destination, delivery date, variety, volume, and weight of the cargo. They are all suitable for exporting goods in the same container. These requirements are very difficult to implement and require a long time. If the transport company consigned by the cargo owner is not strong enough, then the time for cargo transportation will be delayed even longer.
Third, under normal circumstances, FCL cargo can be shipped directly at inland ports, while LCL cargo is only suitable for delivery at developed coastal ports due to relatively few inland sources and relatively more coastal sources. This will undoubtedly add a lot of extra trouble to the exporter. According to the relevant regulations of the Chinese government, exported goods must pass the inspection of the Commodity Inspection Bureau in the place of production and the place of export declaration. If the goods are declared for export within the scope of the province (autonomous region, municipality directly under the Central Government) where the goods are produced, only one commodity inspection is required for a batch of goods. Otherwise, if it is a customs declaration in another place, a batch of legally inspected export commodities must pass two inspections before the customs will release it.
LCL cargo is more expensive than FCL
Under normal circumstances, the freight and miscellaneous costs of FCL transportation in sea freight generally include three items: freight, transportation surcharges and port miscellaneous charges. The freight and transportation surcharges for LCL and FCL should be the same. The difference in cost is only in the assembling of the transported goods at the port of shipment and the unpacking at the port of destination.
It stands to reason that these two costs should not be very high. However, due to the huge differences in the level of labor costs between countries and regions in the world, exporters have little or no knowledge of the specific differences. The original LCL cargo ratio The freight cost of the whole container is very reasonable by adding a certain percentage of LCL, unpacking and storage fees on the basis of the overall consistency. However, in order to earn higher profits, carriers often use "fuzzy The method of "learning" does not specify what items will be charged in the quotation, but only generally according to the destination port to which the type of goods are shipped, and the amount of each freight ton is charged, and the port miscellaneous charges are reported temporarily. What's more, the carrier has no obligation to explain, and the shipper has no room for bargaining. The amount of charge depends on the specific circumstances.
In addition, it should be noted that in import and export commodity trade, the larger the quantity and total value of each transaction, the lower the transaction cost. Conversely, the smaller the quantity and total value, the higher the transaction cost.
Compared with FCL cargo, the quantity and total value of LCL cargo are generally smaller. Therefore, from this perspective, the transaction cost of LCL cargo must be higher than FCL cargo. This is because the cost and mailing fee of the finished sample, the communication fee such as fax and telephone, the notification fee of the letter of credit, the customs declaration fee of the import and export goods, the certificate of origin, etc. are all based on the number of copies rather than the business. The size of the amount to be charged. When these business expenses are finally allocated to transaction costs, the unit costs with a large transaction volume will have a small share, and the unit costs with a small transaction volume will have a large share. We should be aware of this.
The volume of containers in the Asian-American trans-Pacific trade has reached its limit. Large-scale port congestion in the ports of Los Angeles and Long Beach is forcing carriers to take extreme measures. Today, ship voyages are cancelled not because of insufficient demand, but because ships are waiting for berths at anchorages; as more and more container ships arrive every day, the backlog of Southern California ports has reached a record level of 67 ships. This is the first time a ship has berthed outside the San Pedro Bay anchorage in 17 years, and the congestion is expected to continue until at least mid-to-late February.
When the ship is delayed due to long waiting in the port, the carrier will usually add "recovery vessels" to replace and maintain the weekly voyage. But now there are no more "recovery vessels" left. Hapag-Lloyd said, "Since our fleet has been fully deployed and has exceeded its capacity, unfortunately this is not an option at this time."
Therefore, Hapag-Lloyd cancelled 19 voyages in February. "It needs to be emphasized that the ships will not be idle at any time, and we have set sail as much as possible," the company emphasized.
Urgent need to resume suspended voyages
"The reliability of the sailing schedule is too poor. At this time, we should not'withdraw the capacity and stop sailing', but'need to resume the voyage as planned.'" said Simon Sundboell, founder of eeSea.
Due to the decrease in export volume during the Lunar New Year holiday, carriers usually suspend their flights at this time of the year. In order to deal with the backlog of export goods at Chinese ports, carriers initially chose to guarantee voyages during the Spring Festival. However, the congestion in the ports of Los Angeles and Long Beach caused the carrier to have no vessels to deploy. This means that the congestion problem in Asia will take longer to resolve.
Real-time blank sailing data display provided by eeSea platform. As of last week, compared with January, the Asian-American route has dropped by 11% from January. Although the demand for goods continues to rise.
Monthly planned voyages on the Asia-American route (Chart: eeSea)
In a webinar hosted by the freight forwarder Flexport last week, Lars Jensen, CEO of Seaintelligence Consulting, explained: “When all the ships are waiting outside the port to berth, they can’t return to the voyage, so they can’t start what they should have set off. Voyage. Suspension is not an option but a necessity."
San Pedro Bay is congested
At any time since the beginning of this year, no less than 30 container ships have been anchored at the San Pedro Bay berth near the ports of Los Angeles and Long Beach.
According to Southern California Maritime Information on January 31, all anchorages in Los Angeles/Long Beach and all emergency anchorages near Huntington are full! There are 67 container ships in the port area, setting a new record. More than 10 containers will arrive from January 1st to January 2nd. The average waiting time for berthing has already exceeded 7 days.
San Pedro Bay container ship location
In addition, due to the storm and bad weather last week, many of these ships had to leave the anchorage and go to sea. Kip Louttit, executive director of the Ocean Exchange, said that in such a long period of time, with so many ships and such harsh sea winds and sea conditions, what could be more complicated than this.
Port congestion is caused by a large number of incoming cargo and dockers infected with COVID. A spokesperson for the ILWU dockworkers union said that the number of members of the union who tested positive has increased to 803, a 16% increase from 694 on January 17.
Nerijus Poskus, head of global shipping at Flexport, said: “They are unable to provide timely services to ships, which leads to 10-14 days or even longer waiting times, depending on the terminal.” He added: “ As of last week, there are Nearly 300,000 20-foot TEUs are waiting to be unloaded."
According to the data from the Los Angeles Port signal platform as of the 29th local time in the United States: 17 ships are at anchor with an average anchoring time of 7.3 days; 13 ships are waiting to be pre-anchored.
Jensen said: "As long as there is such a waiting time, it is equivalent to canceling all the services of the five transpacific shipping companies." "The impact is huge."
Global shipping on-time rate has severely declined
The reliability of the on-time rate of global shipping has dropped to about 50%, while the normal level is 70%-80%. Receiving a box on time is not much better than flipping a coin. To be worse in reality, blank voyages are not considered in the schedule reliability data. It also does not consider "rolled" cargo-pushing to the next voyage.
Ocean Insights aggregates the freight volume data of the world's top liner companies in the world's top ports. According to published data, the share of ships that did not sail as originally planned rose to 37% in December. This is a significant increase from 29% in July and 25% in December 2019.
(Chart data: Ocean Insights)
An importer transporting goods from China via Los Angeles said: “The shipping time that normally took 28 days has now been increased by 60 days. The container shipped in November last year has not yet reached its final destination.” All of this, American consumers should See the increasing shortage of goods on the shelves. In turn, this will further boost import demand in 2021.
The dawn of hope is here
One of the main reasons for the current shortage of capacity is the shortage of containers. But there is also a silver lining. The Container x-Change container availability index tracking shows that the availability of 40-foot high containers (40HCs) is still extremely low. However, the availability of 20-foot dry containers (20DC) and 40-foot standard dry containers (40DC) this month has increased significantly this month.
David Amezquita, head of data tracking and analysis at Container xChange, asserted that the index "finally shows a positive trend." The company added that the upcoming Chinese New Year may "finally become a turning point."
Index levels below 0.5 are considered shortages. In the third week of January, Shanghai’s 20DC index rose to 0.34, while the 40DC index rose to 0.37. The 40HCs index was still very low at 0.11.
When is it expected to return to normal?
Jensen expressed his belief that the challenge of container equipment will be solved soon. Chinese factories have been busy producing new equipment. "What is happening now is exactly the same as what we saw in 2010 after the financial crisis. If you look at 2010, you will be delighted to find that it took about three months from the appearance of the problem to its resolution. According to the situation, this should be resolved before the Chinese New Year.
"This port congestion has a lot to do with the ability to restore empty containers to a balanced state. This may cause delays in resolving congestion."
As more and more containers are manufactured and put into operation, liner companies should also work hard to resume normal voyages. Jensen said: "The carrier seems to be planning to use the time after the Chinese New Year to return the vessel to its original plan." "If this works and solves the port congestion problem, we can restore [service reliability] within a few months To normal levels. But this is just an optimistic view."
Volume continues to climb this week
Although major container ports across the United States have experienced a certain degree of congestion, with the arrival of imported goods from Asia, Southern California ports are experiencing the most serious congestion. According to data from the Los Angeles port signal platform, the number of imported standard containers per week has increased to 150,000 to 160,000 TEU; while the neighboring Port of Long Beach shows that the number of imported standard containers per week is 90,000 to 100,000 TEU, and the total volume of imports and exports and empty containers Nearly 200,000 per week.
Analysts who are concerned about the port situation expect that freight volumes will remain stable until at least mid-February, when there may be a slight stagnation, as China's manufacturing and shipment volumes usually decline during and after the Spring Festival holiday. However, many shipping companies hope to use this intermittent period to reduce the backlog. The National Retail Federation, which tracks retailers’ imports, predicts in its annual port tracking data that this quiet period may not arrive until April, and then it will appear briefly as retailers prepare for the summer. Strong rise.
