Small containers are becoming a key factor affecting the global trade industry chain.
At the moment, in the field of foreign trade, it has become a consensus that “the one who gets the container gets the world”, and the lack of containers has become a hurdle in the international logistics chain. It can be said that I am in a hurry here, and you are looking forward to it.
Since July this year, China’s export volume has risen sharply, and both the shipping market and the China-Europe freight train market have seen shortages of containers, soaring freight rates, and delayed turnover.
Statistics from the China Container Association show that China’s export containers are mainly satisfied in two ways: unloading old containers after unloading at ports, and new containers made by Chinese container manufacturers.
At present, my country can only return one for every 3.5 containers exported. A large number of empty containers are backlogged in the United States, Europe and Australia, and there is a shortage of containers in Asia.
Containers that are usually returned within 60 days are now delayed to 100 days, and the cost of renting containers has also increased by about 150%.
Zhang Jun, deputy general manager of Qingdao Port QQCT, said:
Under normal circumstances, if 1,000 containers are needed in the current period, there will usually be 1,200 to 1,300 containers waiting at the port. However, when containers are now in short supply, there may be only 800 to 900 containers at the terminal.
Nowadays, in addition to the hard to find a box, there is also a "hard to get a cabin."
The lack of shipping company capacity is the beginning of the nightmare of freight forwarders.
After the suspension, in addition to high freight rates, freight forwarders are faced with the realistic challenge of "bursting cabins".
The relationship with the shipping company is the "most familiar stranger", and the freight forwarder who can't pay the high price can't book the space at all, and the long-term customer's cargo cannot enter the port and board the ship on time.
After the "explosive cabin", due to insufficient space, the shipping company will detain many of the space booked by the freight forwarder on the next flight in order to maximize the benefits. You know, "drop the container".
For large freight forwarders, the losses caused by dumping containers may still be within the tolerable range.
For those small and medium freight forwarders who rely on a few large customers themselves, the disadvantage of insufficient competitiveness in this case may directly lead to their fall.
As the "middleman" between the customer and the shipping company, the explosion of warehouses at the end of the year made the freight forwarding "messy in the cold wind" gradually.
The freight forwarding industry is already facing a situation where the strong will remain strong and the weak will remain weak.
However, freight forwarders serving some special categories will be in a better position because they have their own unique competitive advantages.
On the 17th, Hapag-Lloyd's official website issued an announcement that due to continuous unforeseen operational challenges, it is still facing extremely tight equipment.
Hapag-Lloyd supports all confirmed bookings, but it does not rule out the possibility of cancellation.
At the moment it can be said that: I grabbed the space and lacked the box; I grabbed the box and lacked the space; I grabbed the box and the space , but the freight rate has risen again.······
Winter is coming, Europe and the United States continue to fight back against the epidemic! The most advanced blockade in London, England, or full blockade in New York!
The continuation of the new crown epidemic has caused shipping companies to continue to face port backlogs and ship delays. The tail-end logistics delivery also depends on luck. International supply chains are becoming increasingly tense and global trade is facing the risk of disruption.
Epidemics in Europe and America counterattack menacingly
According to data from Johns Hopkins University in the United States, as of 7:27 on the 16th Beijing time, there were 73,365,192 confirmed cases of new crowns worldwide, and 1,632,554 deaths. The United States is still the most severely affected country in the world, with 16,677,333 confirmed cases and 303,046 deaths.
▍London enters the highest level of blockade again, and the port is still heavily congested
It has been less than two weeks before Christmas, and people are shopping and preparing for the holiday enthusiastically. However, the epidemic in Europe has raised concerns again at this time.
The British epidemic is already a real rebound!
According to the latest epidemic report, there were 18,450 newly diagnosed cases in the UK in a single day, and a total of 1,869,666 confirmed cases; 506 new deaths in a single day, and a total of 64,908 deaths.
Infection in London
On the afternoon of the 14th, the British Secretary of Health Hancock officially announced in the House of Commons that London, the west and south of Essex, and the south of Hertfordshire will be upgraded to the strictest level three lockdown from Wednesday (16th). .
After the escalation of the Level 3 lockdown in London, the following measures need to be strictly observed:
• Bars, restaurants, and cafes are closed, and only take-out and delivery services are reserved;
• Shops, gyms, and barber shops can continue to be open;
• People are not allowed to socialize with people from other families indoors, private gardens or most outdoor public places;
• Up to 6 people can socialize outdoors;
• Fans are once again prohibited from entering football fields and other stadiums;
• Cinemas and bowling alleys are closed;
• People are advised not to go to the tertiary lockdown zone.
British Health Secretary Matt Hancock warned on Wednesday that according to current trends, the government will have to take stricter measures in the capital to effectively limit the spread of the new crown virus.
The Mayor of London warned that “if London enters the third level of lockdown, it will be catastrophic for those industries that have been severely affected by the new crown pandemic.”
Although London was initially listed as a “second-tier lockdown” city when the nationwide blockade measures were lifted on December 2, London’s current level of restrictions will be reassessed next week, just as the relaxation of Christmas regulations is coming A few days before it becomes effective.
In addition, severe congestion in most ports in the UK has forced several shipping companies to impose congestion surcharges and cancel some flights.
British importers are currently facing major challenges, and the shipping division of the Ocean Alliance decided to transfer the other five ships that arrived in Felixstowe in December to Zeebrugge, Belgium. Cosco Shipping Azalea, Ever Goods, Ever Globe, CSCL Jupiter and CSCL Uranus will no longer call at Felixstowe, and will unload British imports at Belgian ports.
British ports continued to increase congestion, 2M abandoned Felixstowe and switched to Liverpool, and major shipping companies cancelled berthing at hub ports. Starting from the end of this year, the 2M Alliance has replaced the Port of Felixstowe with the Port of Liverpool on its TA2/NEUATL2 ring route across the Atlantic.
In addition, in front of the cargo entrance of the Eurotunnel in the Port of Dover in the UK, trucks waiting in line to enter were parked, and the congestion continued for several kilometers.
▍New York City in the United States may be completely blocked, 23 container ships are waiting at anchorage in California
On December 14, local time, New York City Mayor Bill de Blasio (Bill de Blasio) said that due to the deterioration of the new crown pneumonia epidemic, there is a possibility of a complete lockdown in New York City.
He said that since May, he has never seen the current level of new coronavirus infections. Action must be taken to stop this growth momentum. The number one job at present is to protect the health and safety of residents.
In an interview with CNN, Bai Sihao said: “We must start to close the most sensitive areas.” When asked about possible lockdown measures, he said, “I think we must be prepared in the next few weeks to deal with the current new crown pneumonia. With the momentum of the epidemic, we must stop it before it causes too much damage and too much pain."
New York Governor Cuomo pointed out that on Monday, a total of 5,712 patients with COVID-19 were treated in hospitals across New York State. At the peak of the spring, more than 18,000 COVID-19 patients were hospitalized.
Both de Blasio and Cuomo agreed to ban indoor dining in New York City from Monday to curb the surge in hospital admissions. However, they are divided on the circumstances under which they will issue the city-wide blockade order.
According to the latest data released by the Port of Los Angeles, the port's container throughput in November increased by 22% year-on-year to more than 889,000 TEUs. Gene Seroka, executive director of the port, said that every part of the logistics supply chain of major ports around the world is still under constant tension.
On Tuesday, 15 container ships berthed at the Port of Los Angeles, but there were 23 more anchored at the anchored San Pedro Bay. Of these, 14 will go to berth in Los Angeles and 9 will go to berth at Long Beach Port.
It also introduced, “The stay time of containers at the terminal remains at about 5 days, which is twice as long as before the surge in imports in the summer. However, the average waiting time for warehouses and storage space is currently only 6.3 days compared to 7.1 days in October. Get better."
"The situation at the anchorage is currently a real concern for all of us. Many ships currently need to anchor and enter a waiting mode before berthing," Seroka continued. In November, 50 of the 88 ships that arrived in Los Angeles had to drop anchor first, with an average berthing time of two and a half days. So far in December, about 80% of arriving ships will drop anchor first. Now the waiting time has increased to 4 days. "
▍Germany issued the strictest blockade order
On the 13th local time, the German Federation and the state governments agreed to further tighten the epidemic prevention and control measures from the 16th until January 10, 2021.
Retail stores except for food and essential daily necessities will be closed;
Schools and kindergartens will stop teaching face-to-face courses, but will provide distance education;
Business employers should provide employees with vacation or home office solutions.
According to the media, the strength of this "hard blockade order" is almost equal to that of the "wide blockade."
In addition, German Chancellor Angela Merkel warned that Germany will face a new peak of new crown infections next month, which makes people suspect that the hard blockade imposed on Wednesday may not end in early January as originally planned. It is reported that German law requires the government to re-evaluate the nationwide blockade every four weeks.
DHL suspends services in 12 European countries
The current logistics situation really puts some cargo owners in trouble. According to freight forwarders, Hong Kong DHL standard channels have added 6 countries with 0-5KG parcels suspended for shipping services.
The six countries are the Czech Republic, Poland, Hungary, Finland, Turkey, and Bulgaria. In addition to the previously suspended countries-Austria, Germany, Portugal, Spain, Romania, and Nigeria, 12 countries have suspended delivery services.
Congestion and delays in UPS, FedEx and FBA are commonplace. Now even USPS has been complained by sellers that USPS delays have ruined Christmas.
Many sellers abroad have begun to complain about the surge in USPS delays, leading to a surge in complaints from buyers. There are even eBay sellers that have started a holiday mode and plan to return to sell after January.
According to foreign media reports, outside the United States Post Office on Broadway, USPS delivery trucks are already in long queues. A truck driver has been waiting for 16 hours to unload the truck’s packages. Finally, after many round trips, they waited for two. After a day and a half, the USPS truck driver was finally able to unload his cargo.
Outbreaks in other countries
Japan : In view of the continuing deterioration of the epidemic, the Japanese government announced on the evening of the 14th that it will temporarily suspend travel subsidies aimed at encouraging consumption across the country. Japanese Prime Minister Yoshihide Suga announced on the evening of the 14th that from December 28 to January 11, 2021, the country will suspend the "go travel" tourism subsidy program, and the government will compensate the operators for some of the losses.
Netherlands : In view of the rapid development of the new crown epidemic, Dutch Prime Minister Rutte made a television speech on the 14th, announcing that it will comprehensively upgrade prevention and control measures, including closing schools, closing "non-essential" stores, avoiding unnecessary travel, and working from home as much as possible.
Singapore : Singapore’s Prime Minister Lee Hsien Loong delivered a national speech on the 14th, announcing that Singapore will enter the third phase of relaxation of epidemic control measures on December 28. Singapore’s anti-epidemic inter-departmental working group further explained that starting from December 28, the government will further relax restrictions on the flow of people in shopping malls and retail stores, and tourist attractions can also apply to increase passenger capacity. In addition, the government has increased the maximum number of attendees for indoor and outdoor live performances to 250 people.
Palestine : Palestinian Prime Minister Ashtiye said on the 14th that whether to receive the new crown vaccine depends on personal wishes, and the Palestinian government will not force people to receive the new crown vaccine. The new crown vaccine is expected to begin to arrive in Palestine at the beginning of next year, when medical staff and the elderly will be given priority.
Rwanda : Rwanda’s Ministry of Health, Daniel N’gamij, said on the 13th that while the country’s current confirmed cases of new crowns have surged, the number of deaths has also increased, and the Rwanda epidemic has entered a “dangerous stage”. He called on all people to comply with the new crown epidemic prevention measures and avoid going to crowded places and participating in social gatherings when unnecessary.
In 2020, global shipping logistics started as a nightmare due to the outbreak of the new crown epidemic, but at the end of the year it ushered in unprecedented popularity. The price of container transportation has been rising for several consecutive months, and the current freight rate can be described as "rising every day"...
The spot freight rate from Asia to Northern Europe is at a record high, and the annual contract price is expected to rise sharply. The impact of the new epidemic lockdown measures on sales, shippers have increased concerns about soaring freight and surcharges, which may lead to next year The wave of order cancellations.
Asia-Europe part of the freight rate exceeds 10,000 US dollars, and shippers face challenges in the Asia-Europe contract season
The freight forwarder stated that since Asia-Europe freight rates have increased by at least 5 times year-on-year, and the total freight rates of some goods have exceeded US$10,000/FEU, shippers are delaying or canceling shipments before the freight rates are adjusted.
The Shanghai Container Freight Index shows that in the week ending December 11, spot freight rates in Asia and Europe increased 24% from the previous week to US$2,948 per TEU. However, freight forwarders stated that the index reflects market conditions incompletely, and shippers’ quotations exceeded $10000/FEU.
A source said: "We are beginning to see customers canceling reservations because the prices are too high."
Shipping from China to the UK in January, the shipping company is now quoting 10,000 US dollars / 40'HC at sight, the source said: "I heard that the price is 13,500 US dollars."
In addition to the additional costs of shipping companies, including the increase in scheduled cancellation fees, freight forwarders worry that customers will refuse or fail to pay all the additional costs caused by the interruption of the supply chain.
European shippers are preparing for the upcoming contract season and have issued warnings to shipping companies that they will take further action if they try to maintain this year’s sharply increased rates.
The freight from Asia to Europe is as high as US$10,000/FEU, including various surcharges currently applicable to the industry. The Global Shippers Forum (GSF) said that due to “overpriced”, many shippers are currently not delivering goods at all. Small and medium-sized companies cannot pay additional fees.
GSF Secretary General James Hookham said: “The shipper cannot afford the various increased rates and therefore loses business.”
Freight rates in Europe and East Asia continue to rise
▍Maersk announced new fees in Europe and East Asia from December to next year
Maersk announced a new peak season surcharge (PSS), which applies to refrigerated goods from the Far East to Northern and Southern European countries. The surcharge will be $1,000 / 20' reefer container, $1,500 / 40' reefer container, effective from December 15th, and Taiwan will be effective from January 1, 2021.
In addition, since December 1, MSC has implemented PSS of US$500/20' and US$750/40' for all dry goods from the UK, Ireland, Northern Spain, Portugal and the Baltic Sea to the Far East.
In addition, MSC has adjusted the following rates starting from December 1, 2020 until further notice, but not exceeding December 31, 2020.
▍Hapag-Lloyd announced to increase the surcharge from Asia to many places in Europe
A few days ago, Hapag-Lloyd announced new prices from Asia to Europe and the Mediterranean, which will take effect on January 1, 2021.
Hapag-Lloyd also issued a new general tax rate increase (GRI) for all dry containers, reefer containers, non-operational reefer containers, storage tanks, flat racks and open-top containers from South Asia and Northeast Asia to Australia , since January 1. Effective.
Southeast Asia to Australia
US $ 150/20'
US $ 300/40'
Northeast Asia to Australia
US $ 300/20'
US $ 600/40'
From December 7th, Hapag-Lloyd will implement another GRI for all goods and all types of containers from East Asia to the East Coast of South America at USD 550 per container.
At the same time, Hapag-Lloyd announced that it will postpone the GRI implemented in eastbound trade from East Asia to all destinations in the United States and Canada on December 1, and the new effective date is January 1, 2021.
This general rate increase is applicable to all dry goods, refrigerated cabinets, non-operational refrigerated cabinets, storage tanks, pallets and open top containers. Details are as follows:
East Asia to North America (United States and Canada)
US$960/20'
US$1200/40'
East Asia includes countries/regions in Japan, South Korea, China, China/Taiwan, China/Hong Kong, China/Macau, Vietnam, Laos, Cambodia, Thailand, Myanmar, Malaysia, Singapore, Brunei, Indonesia, Philippines, and Russia’s Pacific Rim provinces.
The sky-high freight rates, and the hot availability of space and empty containers, are forcing freight forwarding logistics companies to charter ships and open shipping routes.
Last week, it was reported on Souhang.com that freight forwarding giant DSV Panalpina bypassed the shipping company and leased three ships and a batch of empty containers to open a new China-Denmark route. The latest news is that another freight logistics company giant DHL Global Forwarding also Is considering stepping in.
Dominique von Orelli, executive vice president of DHL Global Forwarding, confirmed to the media that the company is evaluating charter plans.
DHL considers chartering for customers
A large freight forwarding company considered direct control of ship assets, but actually entered an industry that is different from its core business in terms of operation and culture. On the other hand, it also shows how popular it is to ship containers from Asia to Europe and North America. And freight forwarders desperately provide customers with adequate services.
"There may be more freight forwarders to follow suit ." Anil Vitarana, former president of United Arab Shipping, said in a post on LinkedIn.
"If there is a continuing shortage of ship capacity and containers, and major logistics providers and 3PL find it feasible to use internal resources to integrate the economic benefits of the entire supply chain, shipping companies may regret the beginning of this trend." Vitarana wrote.
He added that the logistics provider/third-party logistics provider (3PL) team includes former executives of the shipping company and can help his current employer provide the services provided by the shipping company.
Vitarana also stated that shipping companies can also cooperate with 3PL to improve service capabilities. He pointed out that CMA CGM acquired CEVA Logistics in 2019 and Maersk included DAMCO in its integrator strategy, which has further promoted the supply chain solutions of shipping companies. Program.
But not all freight forwarders consider it necessary to provide shipping services to customers.
Two other large freight forwarders, Kuehne + Nagel and DB Schenker, said that although the container market is extremely tight, they do not think such a move is necessary.
Freight forwarding giant Kuehne + Nagel expressed confidence in products based on digital solutions and cooperative relationships with shipping companies, able to provide services to customers, and will continue to provide leasing services for project cargo, rather than container customers.
DB Schenker does not believe that chartering is one of the solutions for capacity. The current shortage of ships and chartering costs have also increased. Alphaliner, a maritime analysis agency, pointed out in mid-November that most ship charters are tight. The daily charter price of 3,000-3,500 TEU ships is US$18,000, an increase of US$2,000 from the end of October.
Thorsten Meincke, DB Schenker's board member responsible for air and ocean freight, said that the resources needed to charter and manage ships are often underestimated, which will distract attention from the reliable and robust services provided by freight forwarders.
"Once you have ship assets, you have to fill them up. This will become your focus, rather than providing customers with the best solutions," Meincke said. "The current challenge facing the maritime market is largely the shortage of containers, not just the space of ships."
Indeed, other sources also believe that despite Maersk’s efforts to redefine its business model by integrating traditional shipping and freight functions, there are still huge differences in operations and culture between freight forwarders and shipping companies.
Ship asset owners must keep their ships full and require functions and costs such as ship planning and container repositioning, and freight forwarders usually rarely consider these daily affairs.
In addition, the source said that the shipping capacity chartered by DSV is small, and its cost is far from competitive with ships of 20,000 TEU or more that travel between Asia and Europe. This is why freight forwarding and shipping are almost always in different organizations, even in larger shipping companies.
Regarding the concealment of import and export goods, let’s look at a case first:
On August 4, a violent explosion occurred in the port area of Beirut, the capital of Lebanon, on the evening of the 4th. Preliminary statistics showed that at least 100 people were killed and more than 4,000 were injured in the explosion. The Prime Minister of Lebanon confirmed that up to 2,750 tons of explosive chemical ammonium nitrate stored in a port warehouse had exploded.
These ammonium nitrates were piled up in Beirut's port area for six years "without the necessary safety measures"!
It is understood that ammonium nitrate may explode when it is shaken or close to the fire source. The conditions of the explosion are not difficult to achieve. Nitric acid will decompose at about 180°C.
Prior to this, ammonium nitrate has caused too many major explosion accidents. Developed countries such as the United States, Britain, and France have all experienced the horror of the ammonium nitrate explosion. Bloody events are disasters for every country encountered, even for humans.
Everyone must have learned about this explosion from the overwhelming reports. However, this major accident called Lebanon’s national disaster is only one of many port and cargo ship accidents. It is not difficult to find that there have been several foreign explosions in the past. It happened in ports or in cargo ships or trains.
This is bound to be reminiscent of the safety of imported and exported goods, and under-reporting is a thing most hated by various cross-border companies.
Customs declaration: This batch of goods are toothbrushes.
Glass: Who is your name?
Customs declaration: This box of goods is paper towels.
Bath towel: You insult people!
...
These are all concealment of ordinary goods, and may only involve smuggling and other issues, but a concealment of dangerous goods is like sending an untimely bomb to freight forwarders, shipping companies, and port workers. Once an accident occurs, the consequences are disastrous.
Consequences of concealment of general cargo:
In order to evade tax, deliberately concealing part of the taxable goods constitutes smuggling. The specific legal consequences should be determined in conjunction with the amount of tax evasion.
Consequences of under-reporting of dangerous goods:
Serious accidents caused by improper storage and stowage locations; damage to the safety of the crew and the vessel; use of water guns to extinguish water damage to other containers and cargo in the cabin; delays to the entire route; huge operating costs, investigation costs, etc. Etc.; fines required by local maritime customs; customs detaining boxes for several years; may be classified as criminal smuggling and other crimes; pollution to the environment...
Measures to prevent false reports
1. Strengthen professional and safety knowledge education
As a cross-border industry practitioner, we must strengthen the training and education of hazardous materials and safety knowledge, and improve our professional service capabilities.
2. Strengthen the credit review of shippers
Strengthen the credit review of the shipper, and find out the actual source of the goods for the goods whose factory address and name are relatively acceptable. In many foreign ports, concealment of goods is a criminal responsibility, so practitioners must take it seriously.
3. Ensure clear declaration of product name
Make sure that the shipper’s declaration of the cargo brand is clear. If the declaration of the cargo name is vague and general, you must ask clearly. Some chemicals are suspected of being dangerous goods, and the shipper must be required to provide chemical safety instructions and corresponding test reports.
4. New customer information is true
In addition, you need to pay attention to whether the information of new customers is true, especially those new customers who do not need to provide customs declaration, warehousing, and towing services.
5. The product name is inconsistent with the bill of lading
If the product name is inconsistent with the bill of lading, the freight forwarder Yaao will take the initiative to check the customs declaration product name to ensure that the three orders of this batch of goods are consistent.
Magic 2020, the shipping industry has breaking news every day, and it always affects the hearts of foreign trade forwarders.
Today, the Moments of Friends screened the video of the driver grabbing the box. Truck drivers flocked to "queue" to pick up the cabinet. You earn and I grab one box, and they are almost "fighting".
This is a real response. Even if the shipping company normally releases the cabin, there is no guarantee that there will be boxes. It is difficult to find a box in China.
Another heavy news is that CMA CGM will directly stop accepting bookings from Asia to Europe in the next three weeks, and temporarily stop bookings on the Asia-Northern Europe route in the 49th, 50th and 51st weeks. The European route has basically ended this year. Booking.
In recent months, due to the uneven recovery of the global economy, the rebound of epidemics in many countries, and the arrival of traditional transportation seasons such as Christmas and New Year, congestion has occurred in many European and American ports, but many domestic ports are extremely short of containers.
Under such circumstances, many large shipping companies impose additional charges such as congestion surcharges, peak season surcharges, and shortage of containers.
Following the further surge in freight rates on the European and Mediterranean routes last week, data shows that this week, China’s export container shipping market performed stably, and transportation demand remained stable. The freight rates on most shipping routes rose, which led to a rise in the composite index.
The largest increase was the year-on-year growth rate in Northern Europe of 196.8%, the year-on-year growth rate in the Mediterranean Sea was 209.2%, and the year-on-year growth rates in the West and East of the United States were 161.6% and 78.2%, respectively. 390.5%.
Shanghai Export Container Freight Index
As Christmas approaches, shippers and their freight forwarders in Europe and North America continue to generally face the problems of container shortages, port congestion, declining capacity and soaring freight rates. Many people in the industry are talking about the current "peak season" in the container industry. "When will it end?
According to the latest analysis conducted by Lar Jensen, CEO of shipping analysis agency SeaIntelligence, on behalf of the Baltic Exchange, the answer is likely to be around the Lunar New Year holiday in February, because the options available to supply chain stakeholders are very limited.
Chinese New Year will mark the end of the "peak season" of the container industry
The root cause of the current problem is the unexpected demand for container cargo due to the global social blockade.
Jensen said that there are three key issues in meeting higher levels of demand: container, ship and port capacity constraints. He wrote: "If demand decreases, the problem will be resolved immediately."
"However, shipping companies may show their determination to reduce capacity again in order to cope with the downward trend in demand. This means that very high spot freight rates will drop, and new equipment available surcharges will disappear, but the interest rate will not It's too likely to crash." He added.
In these strange years, it is difficult for the industry to reach a consensus, but there are few signs that consumer demand will decline in the short term.
Jensen said that for many shippers and freight forwarders, the most pressing problem is the serious shortage of containers, but as China's container manufacturing plants are in full production, this problem may be alleviated before the Chinese New Year on February 12.
"This problem can be solved within a few months." He said: "The solution is that the empty containers are shipped back from Europe and North America faster, coupled with the full work of China's container factories... The current situation can be After the Spring Festival, it ended peacefully."
However, it will take longer to solve the problem of global ship and port capacity. When the capacity is insufficient, the traditional approach of shipping companies is to turn to the leasing market. However, due to the surge in demand, only a few boats are available for hire.
"As a result, the time scale for increasing capacity has changed from weeks to years now, because it will require the construction of new ships. Moreover, since the peak demand may be temporary, this solution will not help solve the problem." He wrote.
Another option for shipping companies is to increase their ship speed. Faster service can free up the structural capabilities of the shipping group, although this does increase costs.
"In general, considering the optimization of fuel, when modifying or building these ships, they cannot sail as fast as ten years ago, but there is still a certain degree of additional capacity that needs to be activated. However, this also comes at a cost. , Including the sharp increase in carbon emissions."
Finally, there is the issue of port inventory, which he admits is almost powerless in the short term.
"The surge in demand and the increase in ship arrivals have not only affected the number of containers that the port can handle, but also the number of ships that can be berthed and served."
"In addition, the surge in demand has caused larger ships to arrive with more cargo than originally planned, which means longer berth stays, a chain reaction, and subsequent ships will be delayed."
"The expansion of the port's capacity can only be measured in a few years at most. In some areas, large expansion projects can take up to 10 years."
Businesses that engage in international transport most likely prefer freight forwarding, but it is also an applicable method of transport even for personal use. The freight forwarding companies facilitate the shipment of goods to the destinations by using various carriers such as road freight, air freight, railway freight, and ocean freight.
If you don’t have any idea about freight shipping, you’ll find freight forwarding intimidating. Thus, if you engage in a business that involves international transport, it makes sense to understand the facts about freight forwarding.
WHAT ARE FREIGHT FORWARDING FIRMS?
Transporting goods from its origin to another destination is one of the services of freight forwarding firms. The freight forwarder works as a middleman between the transportation services and the shipper. They are responsible for arranging the entire process including the storage and the shipment of the goods. Likewise, they also negotiate the cost of the transport and choose the most reliable, fastest, and economical route.
SERVICES OFFERED BY FREIGHT FORWARDERS
Hiring the services of freight forwarding companies is advantageous to your business. They can help you in transporting the goods to your customers. As they are knowledgeable and expert about shipping of goods, they ensure that the merchandise will be delivered on time and in good condition.
Some of the services that freight forwarders offer are the following:
Customs clearance
Insurance
Packing
International import and export documentation
Inventory management and
Storage
Through the services of freight forwarders, the entire process of importing and exporting of goods becomes less stressful. They can also assist you in the packing of goods, thus reducing the pressure from you.
CHOOSE A RELIABLE FREIGHT FORWARDING COMPANIES
If you’re thinking to hire a freight forwarder, make sure to choose well-established and reliable freight forwarding companies. This gives you the assurance that they have strong experience about the business and good network of contacts. Likewise, experienced freight forwarders can deal and solve any issues about the transport of your goods efficiently and quickly.
As you’ll entrust your goods or merchandise to a freight forwarder, it makes sense to work with them harmoniously. It’s not enough to seek the service of a company that you can rely on and trust, but also with outstanding customer service. This way, you’ll have peace of mind that your shipment will arrive on time and safely.
Before entrusting your goods to freight forwarding firms, make sure that all the documents for transporting the goods are completed.
In the past few months, due to the severe shortage of available empty containers, the global supply chain has been hit, causing exporters to have a headache. However, new research shows that there is an obvious problem in the container supply chain-empty containers stay in warehouses for an average of 45 days, while in China, the average time for each idle container is more than two months.
The research project of German company FraunhoferCML and Container xChange shows that although China and the United States urgently need containers, the average residence time of empty containers in warehouses is 61-66 days, which is much higher than the global average of 45 days.
The east coast of the United States is usually the location of surplus container equipment (the 40DC container availability value was 0.7 last year), but the container availability rate dropped to 0.43, indicating that there are actually fewer containers than needed.
The researchers said that compared with the Middle East (21 days on average) and Europe (23 days on average), the high standard deviations of 85 days in North America and 129 days in Asia indicate that in many cases, containers stay in warehouses longer than average. Much more.
Container xChange is a platform that connects users and suppliers. The platform stated that the availability of containers across China is still at a record low, while the surge in shipping containers from Asia has overwhelmed US ports, and retailers are eager to put their products on the shelves.
Not only is there a serious shortage of 40-foot tall containers (hc) in the shipping market, but there is also a shortage of 40-foot standard containers, and even 20-foot containers are sometimes in short supply.
The container availability rate of 40HCs is only 0.05 CAx (container availability rate) points, compared with 0.63 in the same period last year.
Asia's container manufacturing industry is working overtime to produce, which accounts for 45% of the global container manufacturing market. China International Marine Containers, the world's largest container manufacturer, announced an increase in its orders.
The factory is stepping up container building, and container orders have been scheduled to the first quarter of next year. Even so, the demand for millions of containers has made it impossible for container manufacturing to quench its thirst. The world's three largest container leasing giants have issued a warning that the shortage of containers will continue for four months.
Chinese shippers and freight forwarders all over the world "seeking" empty containers, but where did the empty containers go? The answer is simple, it is blocked in other ports.
While the Asian port and shipping industry is desperately desperate for empty containers, although there is a shortage of shipping capacity, price increases can be used to push shipping companies to cancel suspending, refilling, and increase shipping capacity; however, a large number of containers full of cargo are seriously stranded in European and American ports and warehouses. , Unable to move.
In order to alleviate the serious imbalance in equipment, shipping companies have adopted an active strategy for exports to Europe and the United States, suspending orders, and preferring to use as many empty containers as possible to fill return ships.
In fact, in order to prevent all but the most expensive goods, European exporters to Asia are required to pay more than $5,000 per 40-foot container to ensure shipment in December. A British freight forwarder said that many shipping companies now refuse to accept export orders before mid-January. "Our customers are willing to pay such a high freight, but due to port congestion, we are still working hard to get the boxes away. Some boxes have been on the dock for more than four weeks and still don't know when they will be shipped."
At the same time, the urgently needed empty containers in Asia are scattered in warehouses across Europe, especially in the United Kingdom, where troubled ports have to restrict container delivery to already overcrowded terminals.
The current shortage of containers is a once-in-a-century problem in the history of the global supply chain, and it is basically unsolvable in the short term.
The port is not the boss, the ship is not the boss, and the cargo is the boss. This is a "golden sentence" circulating in the port and shipping industry. However, the freight forwarder who has been busy in the front line of cargo booking may tell you that at this moment of chaos in this industry, the port is not the boss, the ship is not the boss, and the cargo is not the boss. You can't get the empty space if you grab the head. The box is the boss .
In recent weeks, due to a severe shortage of empty containers, some container ships sailing from Asia to Europe cannot even be fully utilized. A shipping source said, “Recently, we have to vacate some spaces because China does not have enough containers to meet freight demand.” Almost all transport companies have reported that they have a serious shortage of 40-foot high containers (hc) and 40 There is also a shortage of standard containers, and even 20-foot containers are sometimes in short supply.
The latest container availability index report from Container xChange shows that the availability of containers in various ports in China is at a record low. From the perspective of the container availability index, the index higher than 0.5 indicates a surplus of empty container inventory, and lower than 0.5 indicates a shortage of empty containers. The current availability of 40-foot containers in China is only 0.05 CAx points, compared with 0.63 points in the same period last year .
Chinese shippers and freight forwarders all over the world "seeking" empty containers, but where did the empty containers go? The answer is simple, it is blocked in other ports.
While the Asian port and shipping industry is desperately desperate for empty containers, warehouses across Europe, especially in the UK, are filled with "immobile" boxes in troubled ports and overcrowded docks.
Affected by the epidemic, shipping companies have used methods such as suspension of voyages and port jumps to control capacity and adjust freight rates, but to a certain extent they also broke the balance of empty and heavy containers between routes. With the gradual recovery of the economy, the trade demand of various countries has rebounded, and the exports of Europe and the United States have grown strongly. However, under the continuous epidemic situation, the various quarantine and epidemic prevention measures added by the port customs will inevitably slow down the circulation of containers. Coupled with the gathering of festivals such as "Black Friday" and "Christmas", the port operation capacity will not be able to keep up with the number of boxes. , The result is that a large number of containers are blocked in the port, empty containers can not go out, heavy containers can not enter. In some British ports, the volume of container transportation in recent months has even been 30% higher than normal, resulting in too many empty containers throughout the UK, and even the alarming phenomenon of containers being piled "at your doorstep".
A British freight forwarder said, "Even if customers are prepared to pay close to crazy freight rates to ensure that the goods are shipped, we are still busy trying to transport the empty containers because the port is already full. Some empty containers on the dock are already After being placed for more than four weeks, we still don’t know when they will be loaded."
In order to ensure the smooth operation of global logistics, liner companies have adopted some unconventional container deployment strategies, such as shortening the free container usage period to stimulate and speed up the circulation of containers on key routes; key routes and long-distance base ports give priority to container use and priority Vacant containers are deployed to countries and regions such as China, Southeast Asia, etc.; the monitoring of container return is slow. For example, some areas in Africa cannot receive goods normally, resulting in whether the container is returned or not. The liner company will comprehensively evaluate and reasonably release the container; some shipping companies even suspend it Made export reservations to Europe and the United States in order to fill as many empty containers as possible back to Asia. However, due to the empty container regulation of shipping companies, the freight rates on the Asia-Europe routes have also been increasing, and the market seems to be in a vicious circle of chaos.
At the same time, a survey conducted by xChange and FraunhoferCML, a German maritime research consultant, showed that despite the large-scale progress in global port handling technology, the time that containers remain empty in ports is still surprisingly long. This report unexpectedly shows that the global container vacancy phenomenon is very serious. The vacant time of each container in the port is 45 days on average, while the vacant time of containers in empty container shortage areas such as China and the United States is longer, 61 days and 61 days respectively. 66 days.
Obviously, the circulation of empty containers is a problem that the entire industry needs to face squarely, but it has been ignored by the industry for a long time. In the sudden crisis of the epidemic, the "old problems" have further deteriorated and gradually developed into today's thorny problems.
It is understood that CIMC, which accounts for 45% of the global container manufacturing market, said that the company is currently stepping up container building and container orders have been scheduled to the first quarter of next year. However, waiting for the new containers to leave the factory, after all, "far water can't save the immediate emergency", and the situation of "a box is hard to find" is expected to continue for some time. In addition to working overtime and deploying empty containers, what else can shipping companies and ports do? The structural empty container circulation problem may be difficult to obtain an optimal solution in a short period of time, but "it is not too late to make up for it". It is time to put more resources and efforts on solving the empty container problem.
As shipping companies continue to detain containers in Nordic ports and charge exporters more than US$5,000 per container to ship a container to Asia, there is increasing pressure for regulatory intervention.
British importers are currently facing major challenges. The shipping division of the Ocean Alliance has decided to transfer the other five ships that arrived in Felixstowe in December to Zeebrugge, Belgium.
According to a consultation conducted by the shipping company to its British customers last Friday , the five ships Cosco Shipping Azalea, Ever Goods, Ever Globe, CSCL Jupiter and CSCL Uranus will no longer call Felixstowe, and will unload the British ships at Belgian ports. Imported products.
In addition, the partners of 2M and THE Alliance are also transferring ships from the congested British port, where the former is loading and unloading British cargo in Bremerhaven.
It is understood that due to the lack of open feeder ships and terminal capacity issues, it is almost impossible for British goods to be transferred before January next year. Some shipping companies are discussing not calling Felixstowe throughout January because they worry that the port will be saturated in a few weeks after Christmas.
However, as the terminals in Antwerp and Rotterdam have also become very congested, the choice of liner companies is becoming increasingly limited. However, a source from a shipping company said: "Our first priority is to reduce imports before shipping our container equipment back to Asia."
British export orders have been suspended by a number of shipping companies, and more and more orders can only be booked at other Nordic ports paying additional fees.
MSC said on Friday that it will significantly increase the FAK fee for a 40-foot container from Antwerp to Shanghai in December by 300% to US$5,000. MSC explained that it is facing very serious operational problems that have seriously affected the reliability and regular supply of inventory.
A source at a rival shipping company said the strategy is to block bookings so that MSC can return its empty containers to Asia more quickly.
He added: "If they can indeed get some reservations at this price, it will be a win-win."
At the same time, the European Shippers Council (ESC) and the European freight forwarders association CLECAT have joined forces to lobby the European Commission to intervene in this crisis.
Denis Choumert, president of ESC, said: "Shipping companies have been taking advantage of the tight capacity to increase revenue far beyond cost, which makes customers unhappy."
"The continuous unreliability of service, coupled with the record profits of the shipping company during the crisis, clearly illustrates a severely disturbed market, and shows that the carrier has substantially increased the spot freight and levied higher than the fixed-term contract price The huge surcharge."
A joint communiqué stated that ocean shipping companies serving Europe benefited from “privileges” that were provided to them by the Union’s Prevention of Immunity Regulations (CBER), which was updated in April.
"Such privileges are now too much because they allow shipping companies to use tools to manipulate the market," adding that the European Commission has not responded to the crisis so far, which is "confusing".
