The ban on transshipment of Ukrainian grain in the port of Odessa will not only lead to significant losses for Ukraine, but will also affect related enterprises around the port. The road transport market is facing challenges. The number of inquiries is high, but the actual fulfillment of orders is low. E-commerce road transport has seen a drastic 90% year-on-year decline, prompting many road operators to return to the pre-2019 model of transport between China, Central Asia and Russia. Around 70% of Chinese citizens' savings are invested in real estate (houses), but the current number of homes is enough for 3-4 billion people. As a result, housing prices are falling. People are cautious about spending due to various uncertainties, and China is showing signs of deflation in June.
Sea freight rates from China to Europe have fallen, but the rate of decline has slowed due to carriers' aggressive strategies to offset further reductions. Maersk revealed on July 17 this year. that it will increase FAK (Freight All Kinds) rates from Far Eastern ports to the Mediterranean, starting July 31, 2023. The new FAK rates from major Asian ports to Casablanca, Morocco will be USD 2750 for a 20-foot container and USD 3600 for a 40-foot container. Earlier, Maersk also announced an increase in FAK rates from major Asian ports to Rotterdam, Felixstowe and Gdansk to USD 1025 per 20-foot container and USD 1900 per 40-foot container, effective July 31. In addition to Maersk, MSC, HMM, Hapag-Lloyd, CMA CGM and other carriers, freight rate increases ranging from $1000 to $1050 per TEU and $1900 to $1950 per FEU are planned, corresponding to 30% and 50% increases respectively.
Latest freight rates estimated by:
Shanghai - Europe: USD 738 per TEU, down USD 2 from the previous week, slightly down 0,27%.
Shanghai-Mediterranean: USD 1412 per TEU, down USD 1 from the previous week, slightly down 0,07%.
– Drewry –
Shanghai-Rotterdam: USD 1 per FEU, USD 292 more than the previous week.
Shanghai to Genoa: USD 1 per FEU, down 902% weekly.
Last July, Russia, Ukraine and Turkey signed an agreement allowing Ukrainian exporters to ship corn, wheat, sunflower oil and other goods from three main ports near Odessa. However, on July 17 this year, Russia withdrew the agreement on the export of agricultural products from these ports. July 18 explosions in Odessa damaged the port infrastructure. The ban on transshipment of Ukrainian grain in the port of Odessa will not only lead to significant losses for Ukraine, but will also affect related enterprises around the port. While the possibility of exporting grain through other countries is being discussed, transport costs are expected to increase by 10-20% even if the new option is implemented.
In recent weeks, rail transport has been running smoothly, and the average transhipment time at the border between China and Kazakhstan last week was 3 days. The average transit time from China to Małaszewicze is 11-13 days, and to Duisburg, Hamburg and Milan 18-23 days. The supply of slots remains stable, and freight rates for August this year. are currently being published. However, there is a shortage of slots from Europe to China, leading to a slight increase in rates on some train platforms.
July 4 this year Two new China-Kyrgyzstan-Uzbekistan (CKU) intermodal trains were launched in XNUMX. One departs from Langfang, near Beijing, and the other departs from Guangzhou. Both routes pass through Kyrgyzstan and eventually reach Tashkent in Uzbekistan.
July 9 the first full timetable train from Duisburg to Xi'an arrived with a total journey time of 11,7 days.
Chengdu plans to expand the transportation of goods in the cold chain between China, Russia and Europe after the successful trial of the first shipments.
In the first half of this year, a total of 8 trains handled 641 TEUs, a year-on-year increase of 936% and 000% respectively. However, this increase was mainly due to increased trade between China and Russia. According to UTLC statistics, trains between China and 16 major European countries (Poland, Germany, Belgium, Hungary and the Netherlands) carried a total of 30 TEUs in the first half of 5, a significant decrease of 114% year-on-year. Of this, 000 TEUs were sent on outbound trains (from China to Europe) and 2023 TEU on return trains (from Europe to China). The freight volume between China and these five countries accounted for just 48,48% of the total rail freight in the first half of this year. Below are the specific volumes of rail transport from China to individual countries in the period from January to June:
– Poland: 60 TEU, a decrease of 554% y/y.
– Germany: 7 TEU, a decrease of 060% y/y.
– Belgium: 3 TEU, a decrease of 514% y/y.
– Hungary: 1 TEU, a decrease of 530% y/y.
– Netherlands: 1 TEU, down by 076% y/y.
From January to June this year, a total of 2 trains carrying 619 tons of goods operated at Xi'an, the main station, showing a significant increase of 2% year-on-year and accounting for 493% of the total number of trains in the first half of the year in China.
Chinese exports to Russia increased by 76% in 2023, while imports from Russia increased by 20,4%. This trade imbalance has led to a large number of empty containers stuck in Russia. In addition, the situation was aggravated by the transport mismatch between raw materials imported by China in tankers and open wagons, and Chinese products transported to Russia mainly in containers.
The road transport market is facing challenges. The number of inquiries is high, but the actual fulfillment of orders is low. E-commerce road transport saw a drastic 90% year-on-year decline, prompting many road operators to return to the pre-2019 model of transport between China, Central Asia and Russia. Some shippers have begun to focus on transporting cars, equipment and bulk cargo. Concerns are growing among shippers that they may not be able to cover costs this year. To accommodate, some shippers set up new offices in cities with more cargo sources, while others hired customer service teams in destination countries. Accessing road transport information between China and Europe has become a challenge, with operators becoming the main source of information.
Efficiency at the China-Kazakh border crossing points has improved, and it takes no more than 1 day to reload and cross the border. Although freight rates are at their lowest since 2019, customers are still reluctant to use road as sea and rail freight is much lower.
The expansion of motor transport has proven difficult and now serves only as a non-essential supplement to a few specific goods. The development of the industry remains uncertain.
(1) As the birth rate in China declines, more and more kindergartens are closing, causing teachers to lose their jobs. The reduced number of pregnancies led to a decrease in turnover in obstetrics and gynecology departments. The demand for baby care products is also falling. China is experiencing rapid aging before it reaches prosperity.
(2) Chinese exports fell by 12,4% in June, but there are indications that the actual fall may be even greater due to misreporting by some local authorities.
(3) About 70% of Chinese citizens' savings are invested in real estate (houses), but the current number of houses is enough for 3-4 billion people. As a result, housing prices are falling. People are cautious about spending due to various uncertainties, and China is showing signs of deflation in June.