Make the textile printing and dyeing factory


After the trans-Pacific market freight rate has remained stable for a period of time, it has recently started a rising and rising mode. According to the Freightos Baltic Daily Index,On December 28, 2020, the freight rate of Asia-America West Coast route reached US$ 4,189 /FEU, a record high, which was 8% higher than that on December 25 and three times that of the same period in 2019.


At the same time, the freight rate of Asia-America east coast route also reached an astonishing $5,397 /FEU.Compared with December 25th, it increased by 9%, which was twice that of the same period in 2019.According to the data of Shanghai Shipping Exchange, on December 25, 2020, the freight rates (shipping and shipping surcharges) of Shanghai exported to the US-West and the US-East base port markets were US$ 4,080 /FEU and US$ 4,876 /FEU respectively, among which the US-West route increased by 4.6% compared with the previous week.


According to analysts of Shanghai Shipping Exchange, the average space utilization rate of ships on the routes from Shanghai Port to West America and East America is maintained at a level close to full load. However, the US epidemic caused the container turnover to be blocked.A large number of containers are stranded in the local docks, and the congestion in the ports is increasing day by day, and the shortage of containers has never been alleviated.


In addition, many shipping companies including CMA CGM, Beurotte, Evergreen Shipping, HMM, ONE, Yangming Shipping and Yixing Shipping have announced that they will charge a comprehensive rate increase surcharge (GRI) ranging from USD 1,000 to USD 1,200 /FEU on trans-Pacific routes from January 1, 2021.


But what is worth pondering is, is this freight rate the real freight rate? Some insiders said that the steady state of spot freight rate is actually an illusion. The price you see is the price paid by non-premium service, but nowadays there are not many deliveries at this freight rate. You actually need to pay a large extra fee on the basis of this price. Some operators (each FEU) charge extra fees of $1,500 or even $2,000, just to guarantee equipment and accommodation. What's the point of a price of $3,800 or $4,000 if you don't even have space and equipment? In fact, you need to pay $5,000 or $6,000 (per FEU) to get the cabin. Or you'll have to wait three or four weeks.


Industry insiders said: "The demand for shipping is still soaring, and the resulting global equipment shortage has pushed up the freight rates of most major Asian routes this week, while the upward pressure on demand seems to have slowed down." Judah Levine speculated: "The most surprising thing is that this freight rate suddenly jumped, which is the first time that the freight rates of these two trans-Pacific routes have risen sharply since mid-September. This may indicate that the tacit understanding reached between shipping companies and relevant regulatory agencies not to improve the freight rates of these routes may be coming to an end."


The strength of spot freight rate has affected the contract freight rate next year


Thanks to the strict capacity control of shipping companies, the container shipping industry has achieved the highest profit for many years. In 2021, the biggest problem facing the container shipping industry is not whether it can maintain a higher spot freight rate, but whether this advantage will affect the contract freight rate.


There are already signs that the contract freight rate is on the rise. According to an evaluation report of Sea-Intelligence, since September, the persistently high spot freight rate is being converted into the contract freight rate. "As far as 2021 is concerned, the overall contract freight rate level may indeed be much higher than that in recent years. Therefore, no matter whether COVID-19 is controlled or not, the epidemic in 2020 will have a strong chain reaction to the contract in 2021. "Sea-Intelligence said in the analysis. American importers who are participating in the trans-Pacific transport service negotiations say that their focus is on ensuring capacity and service reliability, rather than resisting price increases. In November, Eli Glickman, president and CEO of ZIM, said that freight "will be much higher than last year, which is the current trend". "Now, freight rates are not a problem; The space is the problem. In order to obtain the cabin, the customer is willing to pay any price. "


However, there are different viewpoints, and higher spot freight rate does not guarantee higher contract freight rate. According to SCFI data, the freight rate of a single TEU from Asia to Europe reached the highest level in 10 years at the end of November. Rolf Habben Jansen, CEO of He Beurotte, believes that the soaring spot freight rates in Asia and Europe cannot truly reflect the whole market, because more than half of the containers in these transactions are transported at contract freight rates with much lower prices


To the encouragement of shipping companies, the prospect of container traffic growth in 2021 is stronger than the planned capacity expansion. GTA Forecasting predicts that the global container traffic will increase by 5.8% in 2021 compared with 2020. However, container capacity will only increase by 2% to 3%.


High freight rates and lack of boxes will not be restored until the second half of 2021


If shippers and logistics companies hope that the ultra-high shipping container prices will fall in the New Year, they may be disappointed.


Rolf Habben Jansen, CEO of shipping company He Beurotte, revealed at a press conference that global logistics giants and container liner companies expect that the chaotic market, lack of berths and container shortages will continue for some time until 2021.


In addition, Tim Scharwath, CEO of DHL Global Freight Forwarding, also attended the meeting. What these two CEOs have in common is that they agree that 2020 is characterized by great unpredictability, such as promising customers whether their goods can reach their destinations on time.


The two executives agreed that after the outbreak of pneumonia in COVID-19 this spring, the very special environment led to a historic imbalance between supply and demand. They also believe that the container transportation 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 can see the market stabilize again. The first quarter will definitely still be affected, and so will the second quarter. " "We will have to wait and see what happens, because everything is hard to predict. As a large company, we usually make plans for 3 to 5 years. Now, we are working on a three-month plan. "


The lack of shipping capacity and container shortage have serious consequences for the industry's supply chain. In addition to breaking promises to customers 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.


Until recently, shipping companies and container manufacturers predicted that the current container shortage problem would be solved after the Chinese New Year in February, which would 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 expectation. Due to the introduction of economic stimulus measures, people still have money on hand, and most of the money has been used for container goods. There are many indications that the strong market we have seen will appear after the Spring Festival and will continue until the second quarter. " Habben Jansen pointed out that the current market congestion will take some time to solve.




URL of this article:
  • 1611713825208387.png

    Kelun Chinese station


    Kerun International Station

    • Textile Auxiliary BranchPrinting and dyeing auxiliaries Division

      f01.png Jimo,Qingdao,China

      f02.png 0086-532-86538266

    • Water Treatment Branch biological water treatment Division

      f01.png Jimo,Qingdao,China

      f02.png 0086-532-86538255

    • Leather Auxiliary BranchLeather auxiliaries Division

      f01.png Jimo,Qingdao,China

      f02.png 0086-532- 86538288