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Start from 2021, the ocean freight from china to global is constantly increasing. Some of our clients have also asked me why the ocean freight is so high, so here we will share some of the reasons that we know.
Before the epidemic, the sea freight for a 40ft high cube from China to Long Beach, USA costed only 4,000USD. By the end of 2021, it has risen to nearly 20,000USD. Now, even if the sea freight has decreased, it still approach 12,000USD. It is no secret that the increase in ocean freight and operating fees. Coupled with the price increase in gasoline and fuel, and the occupied time of container transportation each shipment is at least twice as long as pre-epidemic, so the cost of shipping companies will naturally not come down easily.
In addition, under the epidemic, various countries have implemented border controls to varying degrees in the response to the epidemic, and many factories have been forced to shut down, jeopardizing the smoothness of the entire supply chain, resulting in China, especially shipping routes to Europe and the United States, freight rates have been soaring.
So,
what is the contributing factors for the rise in ocean freight?
I think it can be roughly classified into the following points:
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Longshoreman working hours.
Under the epidemic, problems such as reduced working hours and the ports worker strikes in some countries have led to a decline in work efficiency.
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Storage of offloaded and full containers.
They have been sitting on the docks for too long.
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Not enough trailer and truck drivers.
Although some ports can operate normally, inland logistics still faces the challenge of a shortage of trailer drivers or truck drivers, who are trapped in lockdown or frequently need to test negative for nucleic acid to work.
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Empty containers cannot be returned to the dock because the dock is too full.
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Due to the lack of empty containers sitting on the trailer, which led to the lack of trailers, the goods could not be picked up from the dock.
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The ports are congested.
In the past year, when the ships enter the port, different countries have relevant epidemic prevention and isolation duration, which makes the waiting time of ships from a few days before the epidemic to several weeks before unloading. As a result, many ships waited for the quarantine time to pass before entering the port, and the number of ships anchored offshore increased significantly, resulting in port congestion.
GENERALLY SPEAKING, the shortage of containers and the inefficiency of cargo ships are the root causes of the increase in ocean freight.
Facing with the shortage of containers, some ports attract empty containers through preferential policies, and shipping companies also increase the number of voyages to increase the capacity. At the same time, with the opening of borders in various countries and the recovery of the entire supply chain, it is believed that shipping freight will inevitably return to the level before the epidemic.
