The shipping supply chain is like a complex network, and any link interruption may have a chain reaction. In the past few days, the Yantian Port epidemic has caused a large number of ships to jump to the surrounding ports, which once caused congestion in South China ports and further tensions in transportation capacity.

Skyrocketing shipping prices

The congestion in Yantian Port and its surroundings is also affecting shipping prices. On the one hand, shipping companies increase surcharges, while on the other hand, shipping fees continue to rise.

"The hopping tide brought about by the Yantian Port epidemic has led to further tensions in the shipping situation. Now it is particularly difficult to determine the space and the price is too high." Many people have not had such a phenomenon in 20 years of working in the industry.

The container that was supposed to be transported to Yantian Port before has been transferred to other surrounding ports due to the liner skipping the port, causing a surge in local cargo and further aggravating the shortage of containers.

Under the current congestion situation, shipping companies are also charging additional charges for containers shipped to Yantian Port. On June 10th, shipping giant Ocean Network Express (ONE) announced that due to the recent detection of new coronary pneumonia cases in Yantian, it has been maintaining low operating productivity. ONE may need to adjust the original transportation plan for refrigerated transportation to Yantian Port, which may lead to imported refrigeration. The storage time of the box is extended.

Under these circumstances, ONE will encourage customers to consider changing destinations to alternative ports, especially time-sensitive goods, such as fresh and refrigerated goods. At the same time, ONE decided to impose a congestion surcharge (CGD) of US$1,000 per person. “This measure will immediately take effect for all refrigerated goods arriving in Yantian from June 10, 2021. For regulated transactions, the effective date will be It is July 2021 until further notice."

The shipping index of the Shanghai Shipping Exchange shows that the index of China’s export containers for the current period (June 11) is 2442.57, which is an increase of 68.80 compared to the index of the previous period (June 4) of 2373.77; Shanghai export containers for the current period (June The index on the 11th was 3,703.93, an increase of 90.86 from the 3613.07 of the previous period (June 4).

Interior screenshots of shipping prices in Nansha Port and Yantian Port show that the price of 40HQ (40-foot tall container or high-container container) from Nansha to Chicago is $12,500, and from Nansha Port to Cleveland/Columbus and other places, the price of 40HQ is $13,500, and from Yantian to The price of 40HQ in Toronto is $14,500. Before the outbreak of the epidemic in Yantian Port on May 21, the prices of these two routes were not so high at that time, at about 10,000 yuan. Compared with last year’s epidemic, the price at that time was only a quarter of the current freight rate, and the price in the second half of last year was only half of the current price.

Even with such a high price, due to the surge in demand in the entire market, there is still a shortage of containers, and shipping companies are also picking customers and providing space in accordance with the VIP level.

On the production side, CIMC (000039.SZ), the world’s largest container manufacturer, stated on the investor interaction platform on June 11 that the current epidemic in Yantian Port and other places may aggravate the tension in the container shipping market, and the company will pay close attention The impact of the latest developments in the epidemic on the company.

Foreign trade companies under pressure

This round of rising freight rates also put pressure on exporters.

A person in charge of a foreign trade export company said, "The increased cost of our company’s freight is now borne by the agent. As far as I know, it has basically increased by more than 150%-200%, so they will suffer losses and worry about transferring in the future. To us."

There are many enterprise orders with low value-added and no price dominance. Most of them use the FOB model. Under the current tight shipping situation, rising freight rates will cause customers to reduce orders, postpone shipments, and cancel orders. It is our manufacturing companies that are hurting."

"The improvement of China's epidemic situation so far has caused many overseas processing orders to be transferred to the mainland. This is our advantage, but if shipping prices continue to rise, the advantage will be greatly reduced." A shipping source said.