The new crown pneumonia epidemic has stimulated freight demand to a certain extent. In 2020, the import volume of containerized cargo in the United States will set a new historical record, and high import demand will continue until early 2021.
Jonathan Gold, vice president of supply chain and customs policy at the National Retail Federation (NRF), said: "Even in the context of the pandemic, the US retail sales will continue to grow strongly in 2020, thanks in part to the government. Stimulus policies. Retailers expect that the economic recovery will continue in 2021."
According to the latest monthly global port tracking report released by NFR and Hackett Associates, preliminary statistics show that in December 2020, the import volume of container cargo in major US ports was 2.02 million TEU.
NRF stated that if the final figures for December 2020 remain unchanged, the U.S. containerized cargo imports in 2020 will reach 21.9 million TEU, an increase of 1.5% over 2019, and break the 2018 annual record of 21.8 million TEU.
In addition, the agency also predicts that in January 2021, this number will reach 1.96 million TEU, an increase of 7.7% year-on-year, the busiest January in history.
Looking ahead, until May 2021, the import volume of containerized goods in the United States will continue to increase substantially.
Specifically: February is expected to reach 1.6 million TEU, a year-on-year increase of 6.1%; March is 1.64 million TEU, a year-on-year increase of 19%; April is 1.76 million TEU, a year-on-year increase of 9.6%, and May is 1.86 million TEU, a year-on-year increase of up to 21.7%.
However, what worries retailers is that there is still a risk of supply chain disruption in the United States.
On the one hand, the congestion in US ports has not been significantly eased. The data shows that as of January 10, 2021, there are at least 47 ships waiting to enter the port at the anchorages outside the Port of Los Angeles and Long Beach. Among them, 34 are container ships with a total capacity of more than 270,000 TEU. The largest ship is 16022TEU.
On the other hand, as the epidemic continues to spread in the United States, the number of confirmed cases in the United States has been increasing, and a large number of logistics industry practitioners are also unable to continue working due to the diagnosis of new crown pneumonia. Many logistics parks in the United States are facing serious manpower shortages.
The Inland Empire logistics zone, located about 100 kilometers east of the Port of Los Angeles and Long Beach, has become an important extension and logistics hub of the above two ports. However, due to the high proportion of employees in warehouses and distribution centers diagnosed with new coronary pneumonia, the supply chain of the logistics park is extremely fragile.
It is also worth noting that with the US President-elect Biden will be formally sworn in on January 20, 2021, the United States may implement a trillion-dollar economic stimulus plan.
Biden once said: "In order to prevent economic collapse, we should now invest a lot of money to develop the economy, which is very necessary."
US investment bank Evercore ISI analyzed that it is expected that there will be two rounds of stimulus policies in the future. First, in the first quarter of 2021, launch a package of US$1 trillion-1.5 trillion to stimulate consumption; second, in the second quarter of 2021, launch a long-term infrastructure package of approximately US$1 trillion.
These will lay the foundation for the US consumption boom in 2021.
It is foreseeable that the US economic stimulus policy will bring more cargo volume, which is expected to directly benefit the container shipping market
On January 4, the freight rate from North Asia to the United Kingdom hit a record high. The reason was that demand continued to rise and the continued shortage of equipment plagued the market. Carriers had no choice but to increase freight rates to maintain profit margins.
The Platts Class 11 container rate from North Asia to the UK reached USD 10,000/FEU, an increase of 285% from November 30. These strong rates are expected to continue until the end of the quarter.
"This is the result of a combination of surge in demand and endless congestion. It will continue until February of the Chinese New Year." said a British freight forwarder.
Market participants are eager to avoid repeating the mistakes of the 2020 Lunar New Year holiday, because the 2020 coronavirus-related lockdown has caused a very slow recovery in China’s export demand, and for most of the past year, the container market has faced a huge Challenges.
Demand during the Chinese holiday period has recovered, which has inspired people to quickly resume work to deal with the backlog of orders, but although the situation is improving, there are some opinions in the market that worry that these optimism may be short-lived.
Nonetheless, the freight forwarder said that containers booked at lower prices have not yet been loaded onto the ship.
"I just cancelled 60 containers; they are destined to go to Europe." said a freight forwarder.
By the end of 2020, the increase in freight rates in the UK is greater than that in Northern Europe, because companies seek to stock up on goods before the UK leaves the EU Customs Union without reaching an agreement.
Uncertainty in future trade relations and concerns about border delays due to customs inspections have led to increased demand for goods. Coupled with the change in consumer spending habits, shifting from services to consumer goods, seasonal demand before Christmas, and replenishment of enterprises after the closure of the country due to national blockades, it is difficult for ports to cope with the increase in quantity. This sentiment has continued into a new year full of congestion, and these situations are still the concerns of many operators.
Felixstowe is the largest container port in the UK. The first problem facing the port is the increase in traffic and subsequent delays. With the increase in demand, the storage capacity of the port has been reduced in recent months because the government has stored PPE (Personal Protective Equipment) in the port. However, according to a statement issued by the Port of Felixstowe on December 13, the volume of PPE containers "has been greatly reduced since reaching the peak."
Flight delays in Felixstowe caused some carriers to modify their schedules outside the port. Maersk and MSC now come to Liverpool through their transatlantic services TA2 and NEUATL2 respectively. Those carriers still calling at Felixstowe have been charged a congestion charge; Hapag-Lloyd currently charges $175/TEU for all cargo passing through the port from Asia.
A freight forwarder said that this may just be the beginning of the British disaster. They said: "Large carriers may no longer provide services to the UK, but only feeder vessels can provide services to British ports."
Carriers need to relocate empty containers, which also results in some containers no longer accepting export bookings for containers loaded from Europe in the foreseeable future, which puts pressure on exporters in the UK and Europe.
On January 4, PCR2—from the North Continent to North Asia—increased from US$1,250/FEU a month ago to US$2,450/FEU.
An airline source said: "These are theoretical figures, no one is taking reservations."
Poorly packaged containers, coupled with the shipper’s misunderstanding of the dangers of certain non-dangerous goods, may cause more than $6 billion in losses to the supply chain each year.
The well-known freight and transportation insurance company TT Club stated that “analysis consistently shows that two-thirds of accidents related to cargo damage are caused or exacerbated by bad practices when packing cargo into containers.”
And explained: "This misconduct in the supply chain has caused millions of dollars in losses, including the death of seafarers and major delays caused by container ship fires. Based on known data, all such incidents are estimated to cause economic losses of more than 6 billion US dollars each year. ."
TT Club Loss Prevention Manager Michael Yarwood added: “The danger is not limited to chemical cargoes such as paints, cosmetics, cleaning products, fertilizers, herbicides and aerosols.
"A wide variety of consumer products and parts used in the manufacture of industrial products, household white goods and automobiles, if handled improperly during transportation, could cause major disasters."
"The list is long, and often surprising-barbecue charcoal, battery-powered electronics, fireworks, hand sanitizer, wool, cotton, plant fibers, marble, granite and other building materials, fish meal, seed cakes, etc."
He said: "Enterprises involved in purchasing, importing, storing, supplying or selling such goods should ensure that their procurement and logistics standards reach the highest level."
He urged shippers to refer to the "Code of Practice for Cargo Transport Unit Packaging" ("CTU Code") jointly published by the International Maritime Organization, the International Labour Organization and the United Nations Economic Commission, which is the industry's closest regulation on container packaging.
Mr. Yarwood said: “It provides comprehensive information on all aspects of packaging and securing goods in freight containers and other modes of transportation under sea and land transportation. It can not only guide the personnel responsible for packaging and securing the goods, but also guide the collection Cargo and unpacking personnel."
He added: "This also solves the crucial issue of correctly describing and declaring goods, including any specific information about the handling of dangerous goods."
He said: "In addition to the serious health and safety risks already described above, poorly packaged containers may also cause damage to adjacent cargo in the event of an accident and cause significant consequences to the shipper."
Last week we looked at the question, “Can anyone be a freight forwarder?”
how to choose a freight forwarder Hariesh commented on our blog, as well as mentioning in his own, that “any Tom, Dick, or Harry can call themselves a Freight Forwarder.”
Of course, you don’t want any Tom, Dick, or Harry handling your imports and exports. It’s important your freight forwarder knows how to handle your international shipping.
With all the freight forwarders that are out there, and the surprising ease to call yourself a freight forwarder, how do you go about choosing a freight forwarder whom you can be confident in?
Well, today’s blog covers just that. Here are 5 tips on how to choose a freight forwarder.
1. MAKE SURE THE FREIGHT FORWARDER HAS EXPERIENCE.
This could almost be the whole list. Experience, experience, experience.
It might be fairly easy to start a freight forwarding company, but the international shipping industry is not the easiest business sector in the world and if you don’t know what you’re doing, you won’t last long.
During TJ China Freight’s 27+ years as a freight forwarder, we’ve seen many, many company’s come and go.
Years of experience means your freight forwarder has dealt with different situations like dockworker strikes and port shutdowns, needs for rerouting cargo, smoothing out customs or warehousing issues, and so on.
Experience usually means your freight forwarder will help you avoid customs, warehousing, and routing problems before they even start so your international shipping will go smoothly.
Experience also gives time for a company to form and cultivate business relations around the world from which you will benefit. Which brings us to…
2. ASK ABOUT THE FREIGHT FORWARDER’S NETWORK OF AGENTS AND BUSINESS PARTNERS IN THE COUNTRY YOU’RE EXPORTING TO OR IMPORTING FROM.
This is obviously important for the local handling of your international shipments.
Your freight forwarder should have a strong network around the world, but you need to know that they have the connections in the countries/cities of origin and destination for your imports and exports.
If you’re exporting and importing to and from Germany, it doesn’t matter how good the freight forwarder’s connections are in China.
TJ China Freight has a very large network and ships to and from almost anywhere in the world; however, you may have noticed a key word in there: almost. There are a few places in the world TJ China Freight does not ship to or from.
You may have found a freight forwarder who is great for shipping to the Philippines, but don’t have the connections or experience to do a great job handling your imports from China. So make sure you ask about your freight forwarder’s connections and experience in the specific locations you need.
Business partnerships around the world also allow your freight forwarder to offer additional services, which brings us to…
3. MAKE SURE THE FREIGHT FORWARDER OFFERS THE SERVICES YOU NEED FOR YOUR SHIPMENT.
Look at the services the freight forwarder offers.
A freight forwarder should be able to handle more than just the air shipping or ocean shipping part of your import or export. They should also be able to handle the rail and/or trucking portion of your international shipping.
I guess if you only need port to port services instead of door to door shipping, you wouldn’t find it a big deal whether or not the freight forwarder offers this service; however, if they do not have a trucking option, that says something about the freight forwarder’s network.
However, there are more services you may want from your freight forwarder. For example, TJ China Freight partnered with TOLL to offer Supply Chain Value Added Services. This means we can help you with things like warehousing, distribution, etc.
Of course, cargo insurance better be among their services and shipment tracking is nice to have if only for your peace of mind.
4. MAKE SURE THE FREIGHT FORWARDER HAS GOOD REFERENCES.
This is good advice when you’re looking for any kind of service, not just freight forwarding.
If there’s no one willing to say a freight forwarder did a great job taking care of their imports and exports, that’s a big red flag.
5. MAKE SURE THE FREIGHT FORWARDER HAS GOOD CUSTOMER SERVICE.
This is hugely important.
How fast does the freight forwarder get back to you on your freight rate request or on answering your questions?
If you’re new to international shipping, are they able and willing to walk you through what you need to know and do to make sure all goes well with your imports and exports?
Your sales person at a freight forwarding company may not have all the answers to your questions as they might be new to the company or even the industry, but they should be able to get the answers for you from the experienced team they’re working with.
How good your freight forwarder is at taking care of your individual needs speaks a great deal about their ability to give the needed attention to your shipments.
Notice, I didn’t even put freight rates in this list as much more important is your freight forwarder’s ability to take care of your shipping needs professionally and precisely.
One freight forwarder may offer shipping rates well below the rest of the competition, but you’ll usually find yourself paying for choosing them in additional costs, delays, and very poor customer service.
But if you follow the five tips above, you should find a freight forwarder who has the contracts and network which allow them to offer competitive rates.
As we all know, the tariffs of South American countries are very high, and customs clearance is difficult. Brazil is a country of South America, and one of the hardest to do so. Today, I'll follow the search network for the Brazil customs clearance.
Brazil is a developing country. In order to protect its industrial production, it has adopted a tax protection policy on foreign imports in terms of imports. Brazil customs is a few countries to check the strict international parcel inspection, for they rate as high as one hundred percent, does not meet the requirements for shipment of goods or the customs will return the goods will be shipped, and shipped back to have a cost.
The main reason for the goods being imported by the Brazil customs is that the correct document information can not be provided during the customs clearance, and the timely homework can greatly reduce the possibility that the goods will be detained by the Brazil customs office so as to smooth customs clearance.
What are the requirements for customs clearance in Brazil?
The common customs clearance documents used in Brazil are bills of lading, invoices, boxes, fumigation certificates, power of attorney (both in Portuguese and English versions). NCM encoding and imported party bill of lading must be marked on the goods CNPJ number, NCM encoding HS encoding similar to the international general, to classify and tax on the product, CNPJ, is similar to the registration number, to determine the importer's identity and qualification. In addition to the invoice indicating the consignor, name, weight, volume, value, contract number, departure, destination and other basic information, but also need to indicate the product price, and address of the manufacturer. The International Plant Protection Convention as "" (International Plant Protection Convention, referred to as IPPC) signatory, Brazil in June 1, 2005 since the implementation of "international trade in wood packing material management standards" (ISPM15), for wood packing material requirements after fumigation / disinfection treatment and affix the IPPC logo.
Brazil customs special bill of lading requirements:
At the customs of the Brazil, all non - individual goods (missing or incorrect documents) will be deemed to be smuggled immediately after unloading and will be seized by the customs and fined. At the same time, the customs of the Brazil has the following special requirements for the original bill of lading:
1) the consignee shall not be "TO ORDER"".
If the bill of lading the consignee (Consignee) as "TO ORDER", the goods will be detained by customs, submit to the Brazil customs system until the consignee details (including complete address, telephone, fax number CPNJ enterprises, etc. and contact etc.), the customs will allow the delivery.
2) the Brazil customs does not accept the description of the general cargo. Such as: Department, good, merchandise, Chemical, Dry, cargo and so on.
3) must be labeled with the consignee (Consignee) enterprise tariff CPNJ goods, Brazil commercial customs NCM code encoding. If Notify and Consignee are different, also must identify its corporate tax CNPJ. In addition, the bill of lading must indicate the volume of the goods (per cubic meter).
4) the freight must be marked in figures and words at the same time on the bill of lading.
Brazil customs - Documentation / equipment inspection
For different channels of goods, the customs will take different means of inspection, in accordance with past experience, most Chinese products will be classified as yellow or red channel, rarely included in the green channel. For the goods of the Yellow channel, the customs will focus on the inspection of customs documents, evaluate the information of the value of the goods, the quantity of goods and the classification of the goods, and release them in the case of the audit. For the red channel of the goods, the situation is more complicated, first by the customs officer of customs documents for review, and then assigned to the port customs inspection personnel on-site inspection, if still unable to obtain the accurate judgment, should be combined with the third party inspection engineer jointly issued by the official inspection and report. From the beginning of the inspection to the issue of a report often takes weeks, this link is the entire customs clearance process in a longer period of time, but also the most difficult to grasp the link.
Brazil customs clearance procedures cumbersome
According to the world economic forum released the "2014-2015" in the global competitiveness report, ranked 144 countries (or regions), in the Brazil customs efficiency ranked 138, so the export of goods to Brazil for a long time, need to have patience.
There are three main tariff rates for imported goods in Brazil:
1 federal taxes
A. import duties. According to different commodities, the import tax rate is different. The average tax rate is now 17%. General raw material tax rate is very low or zero; consumer goods in general is about 20-30%.
B. industrial product tax. The average tax rate is 10%, which is a progressive tax, and is calculated at the price of CIF plus the total value of the import duty.
2. State taxes
C. commodity circulation service tax, which is equivalent to VAT, is a progressive tax, and is calculated at the CIF price plus the import duty, the processing industry, and the total value of the product tax. There are two tax rates, 17% and 18%, 18% in St Paul and 17% in all other states (both of which refer to transactions within the state) Depends on the state of the importer.
Brazil customs is not generally high, in addition to import tariffs and other mixed taxes, customs clearance to pay tips. Moreover, many products in Brazil have anti-dumping duties, and if Chinese goods are exported to Brazil at a high tariff, entrepot trade may be considered.
What products does China levy against the tax on Brazil?
Brazil Chinese of automotive glass, safety glass refrigeration appliances, agricultural tires, truck tires, bicycle tires, motorcycle tires frameless glass mirror, ball pen, coil, ring magnet, plastic vacuum tubes, seamless steel pipe, PVC resin, ceramic filter, two oxygen
Mozambique is a country in southern Africa. At present, there is no direct flight between China and Mozambique, and Chinese citizens can transfer to Mozambique via South Africa, Ethiopia, Kenya and qatar. The Bole International Airport air traffic hub in Africa, many African countries went to other passengers in transit.
Ten city of Mozambique, Nampula, Maputo, Bella, Peng Ba Whelan, Kulusi Tete, Inhambane, Chris Mane, etc., Chimoio Lichinga airport. Which Maputo is the capital of Mozambique, located at the southern tip of Mozambique, near the India Yanmar Maputo Bay, is not political, economic and cultural center, the country's largest city. Maputo port is one of the major ports in East africa.
Maputo International Airport (IATA Code: MPM; ICAO Code: FQMA) is a civil airport 3 kilometers northwest of Mozambique, capital of the Republic of Maputo. Main international, regional and international demand of passenger and freight transport business, many waypoints to the main city of African countries and region, and the Portuguese airline to fly to Lisbon flights, Qatar Airlines operating flights to Doha.
Chinese cargo flights to Mozambique Maputo many, Qatar Airways, Ethiopia airlines, Turkey airlines, South African Airways have flights to Guangzhou, Hongkong, Shanghai, from the start, Beijing, aged 5-7 days. Hongkong to Maputo air freight about RMB40/1000KG+, the volume of goods is not recommended to go, suitable for the value of high, aging requirements of high goods.
Cargo price usually by air freight, fuel surcharge, war of three parts, logistics Baba cargo price is mainly composed of air freight charges, documentation fees, operating fees, manifest pre recorded fees, fuel surcharges. Customers can also add custom declaration, insurance and other value-added activities according to their requirements.
Air freight forwarding is the general freight forwarding to the airport, the customer needs to go to the airport, their own customs clearance and delivery, if the need for customs clearance, the cost is relatively high.
Exports to Mozambique ordinary no special requirements, but the foreign customs tax is serious. The raw material tariff is 2.5%, the fixed assets (class K), the tariff 5%, the tariff for the assembled goods is 7.5%, and the consumer goods is 20%. Customs clearance requirements, packing list, invoice, bill of lading, PSI inspection, certificate of origin, etc.. The government has stopped exporting pornographic and pornographic books and periodicals, film and television, posing as commodities, pirated goods and goods of false origin.
Search air network Maputo air transport, low-cost transit, can receive general cargo, bulk cargo, wooden boxes need to be hit. Airline one to one follow-up, cargo tracking, higher security. From China's air transport export to Mozambique, according to customer requirements, layout, door-to-door, and delivery of the destination.
If shippers and logistics companies hope that the ultra-high shipping container prices will fall in the New Year, then they may be disappointed.
Rolf Habben Jansen, CEO of shipping company Hapag-Lloyd, revealed at a press conference that global logistics giants and container liner companies expect that the chaotic market, lack of berths, and container shortages, etc., will still be available by 2021. Will last for a while.
In addition, Tim Scharwath, CEO of freight forwarding giant DHL Global Freight Forwarding, also attended the meeting. What the two CEOs have in common is that they agree that 2020 is characterized by great unpredictability, such as promising customers whether their goods will reach their destinations on time, which is very unpredictable.
As time goes by and the year is coming to an end, shippers have to pay more and more freight to ship the goods. This development is largely due to the sharp increase in demand month by month since July. For example, it is not uncommon to have to pay US$5,000 for shipping containers from Hong Kong to New York.
▍It will not stabilize until the second half of 2021
The two executives agreed that after the outbreak of the new crown pneumonia this spring, the very special environment has caused a historic imbalance between supply and demand. They also believe that the shipping market will not stabilize for the time being.
Scharwath said: "As for shipping, I think we must enter the second half of 2021 before we see the market stabilize again. The first quarter will definitely be affected, and so will the second quarter."
"We will have to wait and see what happens, because everything is difficult to predict. As a large company, we usually make plans for 3 to 5 years. Now, we are making plans for 3 months."
Inadequate ship capacity and insufficient containers have serious consequences for the industry’s supply chain. In addition to customer dishonesty and record high freight rates, a recent survey conducted by Sea-Intelligence shows that only half of the ships can reach their destinations on time .
▍Shipping companies strengthen management and control
Mainly affected by the new crown epidemic, container shipping companies’ performance in the second quarter was weak, but their profits have soared to record levels since the summer. However, the quality of service is lacking, and container shipping companies have been stating for months that these conditions are beyond the scope that they can change.
On the one hand, they do not have more ships to deploy, on the other hand, they cannot redistribute the containers to the required ports. In addition to other reasons, customers do not return the goods.
Currently, Asia in particular is suffering from a shortage of containers because many containers are in the United States. According to a Bloomberg report, it may also be because of port congestion that these containers cannot be unloaded at US ports. This is the case with 20 container ships currently near the Port of Long Beach.
Therefore, at the beginning of December, CMA CGM, Maersk and ONE had to refuse to leave the booking outside of Asia, the reason is very simple, because there is no extra space on board.
Hapag-Lloyd, led by Habben Jansen, also benefited from the increase in freight rates in recent months. Therefore, the shipping company has twice raised its full-year 2020 profit forecast, and the company currently expects its operating results to exceed US$2.7 billion.
However, the CEO said that it is usually because of an oversupply of ships, and 10 years after the industry has lost billions of dollars, it is time for container shipping companies to start making money.
▍Strong performance in the second quarter of next year
Until recently, shipping companies and container manufacturers also predicted that the current shortage of containers will be resolved after the Chinese New Year in February, which will restore the market to a more normal state. But Habben Jansen no longer believes this prediction is correct.
"This year’s development is beyond everyone’s expectations. Because of the introduction of economic stimulus measures, people still have money on hand, and most of the money has been spent on container cargo. Many signs indicate that the strong market we see after the Spring Festival has passed. It will appear and will continue into the second quarter."
Habben Jansen pointed out that the current market congestion will take some time to resolve.
Price is only an indicator in the process of purchasing a product or service . If you simply compare prices, it is not so thoughtful. Price, quality, service, word of mouth, suitability for your own situation, etc. all need to be considered together.
General cargo aircraft air valence is usually divided into M, N, Q stage, wherein the stage is divided into Q + 45, + 100, + 300, + 500, + 1000, such as different levels - greater the weight, the rate cheaper . M stands for MinimumCharge. The lowest freight is also called the minimum freight. It is the lowest freight that airlines can accept for handling a batch of goods. N means NormalRate, which generally refers to a price less than 45KGS. To apply this freight rate, two conditions must be met at the same time: 1) It must be under 45 kg; 2) It must be ordinary goods-if the specified commodity freight rate is applicable, or the applicable grade The freight rate is not applicable to this freight rate, so N will also be marked as -45KGS. Q means QuantityRate. Q freight rate is the most common in actual shipments. Generally, air freight is mostly higher than 45 kg. If it is lower than 45 kg, general express is fine. Customs clearance is quick to return to the door and the speed is also Not bad.
Freight ForwardingHow does the company count as international Air freight? What constitutes air freight
Air freight rate composition:
1. Airfreight freight (charged by airlines)
2. Fuel surcharge (according to the airport, the price of the destination point is different, Hong Kong now generally the first 4 yuan, before 3.6, last year the highest 4.8, the price is adjusted by the airport, generally 2 yuan to Asia)
4. Airport operation fee (HKD283/ticket for Hong Kong, the airport is responsible for transporting goods on the plane, etc.)
5. Terminal fee: 1.72/kg When the goods are handed over to the dealer, the dealer is responsible for the boarding and other things, which will eventually be collected by the airport)
6. Air master bill fee: HKD15/bl is the bill of lading fee-proof of title.
The above is the " How does a freight forwarding company calculate international air freight? " compiled by the editor of Taijie International Logistics . What is the air freight rate? The detailed content, I hope it can be helpful to everyone. Now it is during the peak season of National Day. If you want to ship by air, you need to make an appointment in advance, and your goods can be shipped by air if they are more than 45 kg. Delivery from different places will also affect the calculation of air freight costs, but generally there will not be too much difference. You can consult several freight forwarding companies in Shenzhen to find out.
Ocean freight has been very developed in the 21st century. How to choose the container used in freight transportation ? The following editor will analyze it.
The emergence of containers is for the safety of the container and the ship, but before packing, it is necessary to know the volume, nature, type, and shape of the goods to choose a suitable container. Of course, some goods cannot be transported, and also The cargo will be damaged due to the wrong container.
As for how to choose the right container for the goods, let's talk about them one by one below.
How to choose the container used in sea freight ?
You can choose sundries containers for valuables and cleaning items; ventilated containers for perishables and dirty goods; refrigerated containers for refrigerated and dangerous goods; livestock (animal) containers for animals and plants; platform containers for bulky items, and bulk The cargo can choose bulk containers.
When we are shipping, it is very important to know how to choose the shipping container, and it is also to ensure the safe arrival of the goods to the destination.
When the overseas epidemic has not been effectively controlled, telecommuting and home isolation have become the norm. The suspension of offline transactions in the past has accelerated the shift of international trade to online. In this context, China's foreign trade exports have accelerated recovery, especially the rapid increase in cross-border e-commerce orders.
Recently, the "home economy" related products represented by furniture, home appliances, toys, and daily necessities have continued to explode. China’s small commodity export orders have surged, and many manufacturers’ orders have already been scheduled to 2021.
Correspondingly, due to the imbalance of China's import and export trade, container shipping export freight rates remain high, and containers are "difficult to find". These problems have become more prominent under the stimulation of huge transportation demand.
The explosive growth of export orders and thorny transportation problems have put Chinese exporters facing tremendous pressure and challenges.
Export orders soared, shipping costs soared
"This time of the year is the peak season. In previous years, the factory was very busy and the number of offline purchases was countless. This year, affected by the epidemic, almost all of them have adopted online ordering." Wan Rufang, general manager of Zhejiang Fengfan Stainless Steel Products Co., Ltd., told China A reporter from Aviation Weekly said.
Ju Jianshuang, general manager of Shanghai Jiesheng Furniture Co., Ltd. also introduced: "Compared with last year, this year our company's export orders have increased by about 10%."
But the headache for these exporters is that although the volume of export orders has exploded, their profits have not risen but fallen. The main reason is that the increase in shipping costs is even more alarming.
At the beginning of this year, the outbreak of the new crown pneumonia epidemic caused most Chinese companies to stop work and production, leading to the cancellation of many orders and a decline in freight volume. Shipping companies have also adopted measures such as reducing capacity and reducing voyage density in response to market changes. However, shortly afterwards, the epidemic in China was effectively controlled, and companies gradually resumed work and production, exports basically recovered, and freight volumes rebounded rapidly.
However, judging from the market reaction, the shipping company's capacity increase did not match the cargo volume, which caused the freight rate to rise all the way. The direct reason for the recent sharp increase in freight rates is that the overseas epidemic has affected the efficiency of port loading and unloading. At the same time, the logistics turnover is not smooth, the shortage of containers is very prominent, and the supply and demand are seriously mismatched. For this reason, shipping companies have begun to levy congestion surcharges, peak season surcharges, and lack of containers surcharges.
Latest SCFI data
According to the Shanghai Export Container Freight Index (SCFI) released by the Shanghai Shipping Exchange, on December 18, the market price of Shanghai’s exports to European basic ports (including maritime surcharges) was US$3,124/TEU, an increase of 6.0% from a week ago. Compared with the US$1,508/TEU a month ago, it has doubled.
The price of US$3,124/TEU on the Asia-Europe route is the highest ever since SCFI was released in 2009.
During the same period, the market prices (including shipping surcharges) for exports from Shanghai to basic ports in the West and East of the United States were 3,900 US dollars/FEU and 4874 US dollars/FEU, which were also at historical highs.
Cai Jiaxiang, vice chairman of the China Association of Foreign Trade and Economic Cooperation Enterprises, said bluntly: "Sometimes, the sum of various surcharges even exceeds the freight."
Exporters' profit shrinking affects foreign trade stability in the long term
It is understood that about 80% to 90% of foreign trade export enterprises in China sign the FOB clause in the export contract, that is, the buyer pays for the freight.
Cai Jiaxiang analyzed: "In a short period of time, because Chinese exporters who sign FOB clauses will pay the freight by the buyer, it will not be greatly affected in the early stage of the price increase. But from a long-term perspective, if the freight continues to rise, the export The business is bound to be affected to a certain extent."
He took the US importer as an example. If the buyer needs to pay up to 5,000 US dollars in freight per box for a long time, the buyer's import cost will be greatly increased, and the Chinese exporters may be required to share the high freight.
Even if the Chinese exporters who sign the FOB clause do not need to bear the ocean freight, they still have to pay for the transportation costs of the goods from the factory to the dock. At present, affected by the lack of containers, exporters can only obtain empty containers by waiting for empty containers or raising the price. In order to ensure shipments, most exporters will choose to increase the price to pick up the box, which also increases the export cost of Chinese exporters.
More importantly, the continued high freight rates will also affect the purchasing power of overseas consumers. Due to the increase in costs and the substitutability of some commodities, importers may consider whether to use substitutes when choosing commodities.
Wan Rufang said: “Our company’s order volume from August to October was relatively large. Compared with March to June, it has doubled. But starting from November, some countries have adopted closed measures and freight Excessively high, to a large extent affect the customer's purchase volume."
On the other hand, the Chinese exporters who signed the CIF clauses, as they directly bear the export freight, have a deeper understanding of the pain points of high freight, and it has effectively affected their own profits.
Ju Jianshuang's company faced this situation. He reluctantly said: "Our company is mainly based on signing CIF contract terms. In most cases, the ocean freight of exported goods is borne by us. The recent rapid increase in freight has caused the company's costs to rise sharply, and the monthly profit is about reduced. 600,000 yuan."
Ju Jianshuang said that the high freight rates are too burdensome for companies that "small profits but quicker sales" and mainly out-of-stock volume. "We will consider negotiating with customers to postpone shipments or raise prices appropriately. But the main solution is to give up some profits by the company itself to maintain normal operations."
He believes that a balance should be maintained between production companies and transportation companies to ensure the living space of both parties.
However, even in the current era of "hard to find a box" and frequent freight charges, seaborne export is still the first choice for Chinese exporters.
There are two main reasons for this. One is the export destinations of some exporters, such as the United States, Canada, Malaysia, Singapore and other countries. These destinations cannot deliver goods by means of transportation other than sea or air, and air transportation has certain transportation restrictions and the freight rate is too high. , Most exporters will not consider; second, although shipping costs have risen sharply, they are still lower than road, rail, air and other transportation methods. At the same time, shipping has greater advantages in capacity and can better meet the needs of Chinese exporters.
Cai Jiaxiang further explained: "In the early days, shipping goods to Europe via the China-Europe Express train cost about US$10,000 per TEU. At present, although the freight rate of the China-Europe Express train has been lowered to US$7,000-8,000 per TEU, the price is still higher than that of ocean freight. From the perspective of many Chinese exporters, price is more important than speed."
Chinese and U.S. regulators frequently call for exporters to restore capacity
In response to the current difficulties faced by Chinese exporters, the Ministry of Commerce of China has paid close attention and responded publicly.
Gao Feng, spokesperson of the Ministry of Commerce, said at a recent press conference that many countries around the world are facing similar problems in foreign trade logistics due to the impact of the new crown pneumonia epidemic. The mismatch between supply and demand of capacity is the direct cause of the increase in freight rates. Factors such as poor container turnover have indirectly pushed up shipping costs and reduced logistics efficiency.
Gao Feng, spokesperson of the Ministry of Commerce
He further emphasized: "The Ministry of Commerce will work with relevant departments to increase capacity allocation, support accelerated container return transportation, improve operational efficiency, and support container manufacturing enterprises to expand production capacity. At the same time, it will increase market supervision and strive to stabilize market prices. Provide strong logistics support for the stable development of foreign trade."
Prior to this, the regulatory authorities of China, the United States and other countries have also stated that they will pay close attention to issues such as rising freight rates in the shipping market.
In September of this year, the Ministry of Transport of the People’s Republic of China interviewed all shipping companies operating China-US liner routes, emphasizing that it will strengthen the supervision of China-US routes, requiring that the capacity, routes and schedules must be filed, and freight and all surcharges must be regulated. reasonable.
Also in September, the US Federal Maritime Commission (FMC) also issued a warning to shipping companies that it would crack down on potential violations of competition laws. Soon after, FMC also announced the toughest measures to increase the supervision of the three major shipping alliances in response to issues such as freight and demurrage. It is required that shipping alliances must submit specific trade data to FMC every month, whereas previously it was only required to submit every quarter.
In this regard, Cai Jiaxiang said that the European and American regulatory policies are relatively timely. The EU has the most stringent anti-monopoly issues, and the United States is not inferior. These areas have achieved certain results in freight control, and prices are relatively stable.
Regarding the domestic export trade market, Cai Jiaxiang believes that “restoring the original normal capacity and flight density is the top priority to solve the problem.”
He further stated that the voice of the Ministry of Commerce can improve the current market conditions to a certain extent, but it still needs to increase efforts. "Call on the Ministry of Transport to interview shipping companies to restore normal capacity and flight density, and the State Administration for Market Supervision and Administration will use anti-monopoly laws reasonably and adopt legal weapons to cut the root cause of shipping problems." Cai Jiaxiang said.
