what is the situation of the freight market?

- Dec 13, 2020-

A large number of plastic tables and chairs are piled up in the warehouse, not that they can't be sold out. However, after the customers place an order and we prepare to deliver goods, we found that we can't book the shipping containers. As a result, the warehouse is full of stock. some customers are not willing to ship since the sea freight is too expensive, which has increased by 3-4 times. they want to wait and see.


I believe that many of my friends are like me. Seeing that the cost of shipping is rising rapidly, do businesses have to make money for the people of the world during the epidemic? Is there any reason behind the surge?

This year's shipping price has gone crazy! Taking the most popular Sino US route as an example, some insiders have disclosed that the shipping price to the United States continues to soar. At present, the freight cost of a 40 foot container costs US $4000 or even US $5000, which is two or three times that of the same period last year, reaching the highest level in 20 years.

In addition, many routes frequently appear the phenomenon of "one container is difficult to obtain", even if facing the pressure of freight inflation, export enterprises can only offer higher prices to obtain cabin space. Therefore, it is faced with great pressure of logistics cost. Shipping companies have formed interest alliance due to the shortage of transportation capacity and frequent explosion of hold and container?

At this time of the past year, the freight rate of container ships from China to the United States has almost ended, and the price rise has entered a stable situation. But now, the route freight rate not only rises sharply, but also continues. So why does this happen?

In addition to their own ships, shipping companies will choose to rent out. Affected by the epidemic situation, the major shipping companies are not optimistic about the foreign trade situation this year. At the beginning of the year, the transportation capacity was greatly reduced, especially in the trans Pacific routes. However, despite the impact of the global epidemic, foreign trade has recovered and transport capacity has not been restored in time, resulting in insufficient international transport capacity, which in turn leads to an increase in international freight rates.

This leads to frequent cabin explosion and container dumping on popular routes. For shipping companies, the shipping space is pre-sale, which may sell more space than it can carry. If the booking volume exceeds the actual loading capacity, the shipping company will choose to give up some shipping space. The success of shipment is often determined by the shipping price of foreign trade enterprises. The formation of interest alliance among large shipping companies is also an important reason for the increase of shipping line price. Some people in the industry said that over the years, the trend of large-scale ships has become serious, and more and more shipping companies have formed alliances. Among them, there are many alliances in the Pacific routes between China and the United States. They keep a tacit understanding on price and "hang" foreign trade enterprises in special periods. For example, with the survival of the fittest in the market, at present, the whole market has formed three major alliances, namely 2m, ocean alliance and the alliance. They pay close attention to and control transport capacity, and maintain high profits through investment in transport capacity and regulation of freight rates.

However, oimagebjectively, the epidemic also hindered the improvement of transportation capacity. Nowadays, the epidemic situation has not been completely controlled in foreign countries, and many countries lag behind China in resuming work and production. Due to the long time for the other party to unload ships, the cargo ships will stay at the port, causing the whole import and export to be blocked, leading to the shortage of shipping market capacity.

It is not only the soaring freight rates of China's exports to the United States, but also the soaring freight rates and the shortage of first class cargo in Europe, Australia and other places

The sea freight from China to Europe has risen to more than 2000 US dollars, which has more than doubled to less than 1000 US dollars in June this year, while the freight rate for a container from China to Australia is currently US $3000, compared with us $600 in August last year, a four fold increase;

First of all, the overseas epidemic situation is severe, and the global demand for goods transportation is sharply reduced due to the great blockade measures of various countries in the world, and the tide of global shipping industry suspension has not been lifted.

Secondly, October is the peak season for International Shanghai style and air transportation. Thanksgiving in November and Christmas in December are grand festivals in western countries, and countries will import a large number of materials from China before festivals.

During the epidemic period, China's containers could only go out and in, while the foreign terminals had too many boxes to pile up, but Chinese terminals were in a hurry to find them. The imbalance of transportation capacity leads to the rise of freight rates, so the current container shipping companies generally impose various surcharges.

In order to ensure the delivery of the goods in case of serious shortage, the shipper can only make sure that the goods are delivered on time. So, my friends, you are still hesitating whether to ship the goods now or wait for the shipping charges to drop. Then, our suggestion is to ship the goods as soon as possible. It is expected that the shipping charges will not drop within half a year.