Industry new
China's export boom drives up container prices
The German newspaper "Handelsblatt" published an article on May 31st, with the original title: China's export boom has driven up container prices, and containers are everywhere, with several kilometers long docks available for supply ships to dock. Shanghai Port is currently the port with the largest container throughput in the world. In 2023, nearly 50 million standard containers were processed here. The container and freight business of Chinese ports continues to show an upward trend. All mid-term data shows that this year is even stronger than last year. China's export boom is driving up the rental prices of container business, thereby changing the shipping industry of the world's oceans.
The rapid growth in global consumer demand is surprising, "said a manager at the freight forwarding company, Dexin Group. Even worse, just like during the pandemic, there is a shortage of containers.
The utilization rates of ports in the southern metropolises of Shenzhen, Guangzhou, and the northern city of Qingdao in China are also relatively high. Mr. Wei from Shenzhen Zhongji Logistics Group said, "The peak transportation season is still behind, but the volume of goods is already large." The logistics company transports products such as aluminum plates and fans to Europe.
The export boom and growing geopolitical risks are driving up rental prices for China's container business. Mr. Wei introduced that the current shipping cost for each standard box is about 6000 to 7000 US dollars, while the price in April was 3000 to 4000 US dollars. According to a survey report by the German company Escher on approximately 800 freight forwarders, logistics, and container traders in China, customers reported an average increase of 88% in container prices between April and May.
There are many reasons for the rapid rise in prices: after the average price of Chinese export goods dropped by nearly 10% from 2022 to 2023, China's foreign trade has rebounded again. Mexico and Brazil are currently the driving forces behind China's foreign trade: in April, the shipping capacity between China and South America reached 3.9 million TEUs, an increase of one-third compared to 2019.
Meanwhile, Chinese electric vehicle manufacturers are entering the European market. According to the analysis of the Atlantic Council, China's electric vehicle exports will increase by 70% year-on-year in 2023, of which 40% will be sold to Europe.
Cars can be transported by roll on/roll off ships or container ships. However, the current roll on/roll off fleet is too small to meet China's export ambitions. According to Chinese media reports, the number of orders for roll on/roll off ships has sharply increased in the past two years, with dozens of them coming from China. The shortage of roll on/roll off ships has led many cars to use container ships for transportation, and containers are not only becoming increasingly expensive, but also becoming fewer and fewer.
In addition, the attacks launched by Houthi militants in the Red Sea are pushing up transportation prices, so shipping companies including COSCO Group must readjust their routes. The alternative route is to bypass the Cape of Good Hope in South Africa. Mr. Wei from Shenzhen said, "This has extended the route from China to Europe from a minimum of 20 days to nearly 30 days
All experts are aware that, given all these challenges, the price trends in the container and logistics markets are more uncertain than ever before.
∷
