Apr 20, 2023 thatsymlog There are no comments

Economists believe that demand from most Asian countries and Europe is beginning to recover. Global economic growth may be better than expected.
The supply chain industry expects growth during the peak season, and freight demand may pick up in the second quarter of this year. as supplies run out over the coming months. In the first quarter of 2023, bilateral trade between China and Europe totaled ￥1,34 trillion, up 2% year-on-year and accounting for 13,5% of China's total foreign trade.

 

Sea freight

In recent weeks, carriers have raised their GRI by $540 to $1250 due to a lack of slots, a result of massive ship reductions and rising costs.
The latest report on the freight market shows that the container shipping industry is rebounding after successive declines since last summer. The overall market trend is currently positive and is expected to continue in the future.
The SCFI posted a 3,6% weekly gain, its biggest weekly gain since May 2022, while the CCFI was down 0,6% but reduced the weekly drop from 1,9% a week ago.
The Alphaliner Chartering Index also showed an increase in charter rates for vessels of all sizes, the first increase since June 2022.
The total value of Chinese imports and exports in March. also increased by 7,4% compared to the previous year and by 32% compared to February this year. Exports totaled $315,59 billion, an increase of 14,8% compared to 2022, well above market estimates of a decline of 7,1%.
Economists believe that demand from most Asian countries and Europe is beginning to recover. Global economic growth may be better than expected.
The supply chain industry expects growth during the peak season, and freight demand may pick up in the second quarter of this year. as supplies run out over the coming months.
Negotiations on long-term contracts may be delayed as shippers wait for a better position and anticipate shortening the one-year contract period.
April 12. The United States tightened sanctions against Russia again. Three shipping companies and 19 ships have been sanctioned for supporting Russia directly or indirectly.

 

Sea freight rates acc. Drews are:

Shanghai-Rotterdam: $1532/FEU, +4% weekly
Shanghai-Genoa: USD/FEU 2236, 0% weekly

 

Rail freight

Trains have been running smoothly lately, but the reloading time on the border between China and Kazakhstan has increased to an average of 3-5 days. From Chongqing, Chengdu and Xi'an in China to Germany (Duisburg, Hamburg) takes an average of 18-20 days. Windy weather in Kazakhstan affects operations and increases total transit time.
Some platforms still have enough slots at the end of April. Slots to Central Asia are almost sold out due to the low number of trains. Rental prices for containers and trailers for transport over the first mile remain stable.
In addition, several cities in China have increased the number of routes to Central Asia and Russia this year.
According to the latest data from China's National Railway Group, in the first quarter of this year, In 4, 186 trains carrying 449 TEU left China, an increase of 000% and 15% respectively. Among them:

Xi'an: over 1 trains, an increase of 100% year on year
Wuhan: 315 trains with 25 TEUs, an increase of 968% and 202,88% respectively year-on-year

In March this year A total of 1488 trains with 162 TEUs left in 000, an increase of 31% and 52% respectively.
It is worth noting that these figures include the number of trains from China to Russia and Europe. China Railway Group does not publish data for Russia and Europe separately. This may be due to a flawed statistical system or because China prefers to publish positive data.
Rates on China-Russia routes are reported to have dropped sharply, mainly due to Russia's reduced purchasing power and increased maritime capacity.
OCT and Shandong Port Group (SPG), China's largest port operator, will work together under the signed agreement to develop multimodal container services and digital products, including the Caspian Sea and Black Sea maritime segments.
In the first quarter of 2023, the volume of transit cargo from Kazakhstan increased by 35% year-on-year to 7,2 million tons. Transit container traffic increased by 19% to 313 TEU in the first quarter.

 

Road transport

Currently, few goods are transported to Europe by land. In the past, these were mainly e-commerce goods, but due to the seizure of Chinese companies that illegally circumvented VAT in Belgium (leading to increased scrutiny of e-commerce goods in many European countries), Chinese sellers are cautious about sending new goods to Europe .
In addition, retail sales are declining in many European countries, and slow stockpiling is also affecting the volume of new e-commerce shipments. At the same time, the industry does not have enough confidence in road transport since Poland closed road crossings with Belarus. However, dangerous goods such as batteries continue to be transported by land.
The tariffs offered by carriers have fallen, but the price of road transport is still much higher than that of rail and sea transport. Currently, the cost of transport from China to Poland is about PLN 17-18 thousand. dollars.
The good news is that the border crossings between China and Kazakhstan have introduced a 7-day working week and extended daily working hours. Thanks to this, the speed of customs clearance has increased significantly. In addition, Kazakhstan is optimizing its administrative system and is trying to increase the volume of truck traffic from less than 100 trucks a day to 1000. Geopolitics and the transit time of railway goods greatly influence road traffic.

 

news 

In the first quarter of 2023, bilateral trade between China and Europe totaled ￥1,34 trillion, up 2% year-on-year and accounting for 13,5% of China's total foreign trade.
– China's exports to Europe: ￥866,67 billion, up 0,3%, 2/3 of which were electromechanical products.
– China imports from Europe: ￥470,87 billion, up 5,2% y/y.
– From January to February 2023, China's total exports to the EU amounted to ￥552,837 billion, down 5,0% y/y.

Recent studies in China show that more than 70% of foreign companies in China do not intend to move their production departments outside of China, mainly for the following reasons:
– Huge market in China: 84%
– Well-developed industrial chain: 40%
– Well-developed infrastructure: 36

For companies that have moved or are considering moving their supply chain outside of China, the most attractive countries are Vietnam, India, Indonesia. Common features of these 3 countries are:
– large population
– a large market
- plentiful labor supply.