According to the Shanghai Container Freight Index (SCFI), the spot freight rate of trans-Pacific containers on the west coast of the United States has exceeded the US$3,000 mark, reaching a record level of US$3,167 per 40-foot container，shipping from China to the US, so many US importer want to cry but have nothing to do and If you are confused and feel fooled by the tricks of these carriers, you are like being raped. The freight forwarders in the United States and China have no way out because they are just agents. Many importers will complain to their Chinese forwarders, but this is of no use.
For example, today last year is August 2019. The average ocean freight from Ningbo or Shanghai port to Los Angeles port fluctuates between 1300USD-1600USD. Now, shipping from China to the United States, especially Ningbo and Shanghai. The ocean freight to Los Angeles has reached an average of 3000USD-3200USD/40HQ, this is really bad when you importing from China.
The sea freight from China to the United States has caused all US importers to bleed. Many Chinese suppliers and American importers do not understand the reason. Many people believe that since the current global COVID-19 outbreak As the US epidemic is so serious, it stands to reason that the number of US containers imported from China should be reduced, or the sea freight from China to the US should be lowered. Why is the container sea freight abnormal? This price is crazy and almost collapses American importers.
It is unique in the history of trade between China and the United States in the past 100 years.
In 2020, driven by the GRI on August 1, the US West Coast index soared by 17%, an increase of 100% over a year ago.
This is the highest level in the history of the SCFI index in the 10 years since its establishment, and the ratio may rise in the next few weeks. This price means that shipments from many basic ports in Asia to the west coast of the United States are subject to high sea freight.
SCFI also recorded a 7% increase in spot freight rates on the East Coast of the United States to $3,495 per 40-foot container. Although there is still a 25% increase compared to 12 months ago, the increase is not as impressive as the short-distance transportation routes to the West Coast ports.
After four successful GRI negotiations, shipping companies are preparing for a new round of gains in mid-August, with a surge of more than US$1,000, which is due to the strong demand outlook this month. Many people may think that because of the trade war between China and the United States, the number of goods imported from China will decline. This is wrong. Because the United States has developed a bad habit of relying on Chinese manufacturing in the past 20 years. The industrious Chinese sacrificed a lot of time and labor to provide the American people with cheap and high-quality products.
In this process, in the past 20 years, the United States has actually helped China from a poor, backward country. It developed slowly and established a complete supply chain system. In fact, China would like to thank the two countries. The first is the United States and the second is Japan.
Although political topics are not discussed in this blog, the strong national power of these two countries has created amazing consumption power, allowing the Chinese people to serve them. A considerable population is engaged in industries related to the supply chain, such as factory workers and technicians. , R&D personnel, warehousing personnel, transportation personnel, foreign trade sales, foreign trade documents, inspections, related consulting industries, service industries, freight industries, truck drivers, simple foreign trade from China to the United States, which has driven China countless Population employment, if China and the United States stop trade, then we believe the real disaster is coming. Therefore, mutual cooperation between China and the United States is the real win-win strategy.
Of course, the United States can no longer break away from China’s cheap products, and many large and medium-sized import companies, purchasing companies, and trading companies have established a complete set of goods imported from China, quality control, supplier selection, factory inspection, and logistics. No one wants to build sales channels in the United States and the complicated interests involved in the mistakes within a short period of time. The supply chain that has been painstakingly built over the past 10 and 20 years has been interrupted in this way.
Of course, the United States has realized some of the negative impacts of its heavy dependence on Chinese manufacturing. The Trump administration has been commissioning the return of manufacturing industries. Recently, many international companies such as Japan, South Korea, and Taiwan have also begun to set up factories in countries around China and move factories from China. , Withdraw from the manufacturing industry, and set up new manufacturing bases in Vietnam, Malaysia, Thailand, and Cambodia. Of course, in this process, Bestforworld also helped these multinational companies to start shipping from these Southeast Asian countries to Japan, South Korea, the United States, and Europe. This is a trend. Although the process is painful, the United States and other countries have realized this.
This trend is Irreversible. After all, China has experienced 20 years of low-end manufacturing. Most of the goods imported from China to the United States are cheap daily necessities, toys, and textiles. Of course, with the transformation of China’s industrial structure, more shipments will be made from China in the future. Products ship to the United States will be replaced by more mid-to-high-end products and high-tech products. Although the US government is also aware of China’s rise in the field of science and technology and has begun large-scale sanctions, this is an inevitable trend and cannot be stopped.
However, the carrier’s eagerness to resume the interrupted voyage may throw cold water on their prospects.
According to eeSea data, only 10 out of the 245 scheduled voyages in Asia and North America in August, and only 5 out of 243 scheduled voyages in Asia and North America in September.
Whether the shipping trade routes can withstand the decline in demand caused by the pandemic is still inconclusive, but there are rumors that the reduction in factory orders may lead to a sharp drop in ship bookings in September. In addition, the soaring freight, the risk of dumping containers, the increase in demand for personal protective equipment, and the introduction of electronic products during peak seasons have brought air freight back to people’s attention.
Investigations conducted by US freight forwarders indicate that orders from Chinese factories may slow down, which will hit the shipping container industry in September. when you shipping from China to US。
According to freight forwarding consultant Jon Monroe, in order to accurately understand the near-term demand, factory orders can be warned early because these orders are made up to 60 days before the goods are shipped.
Monroe said that he has seen a number of investigations conducted by Chinese freight forwarders. “One of them has investigated factory orders and warned that orders will be reduced in September. Therefore, I ask the global logistics team in Shanghai to be responsible for the investigation of our network in China. The factory conducts similar investigations. Although we are still seeing strong momentum, there is no doubt that some industries are slowing down.”
According to data from freight forwarders, August itself was still very strong, but weaker than July, and September’s load volume is still uncertain. For the cargo importing from China to the US.
Monroe added: “When the survey came back, orders from some factories decreased, while orders from other factories increased. But consumer confidence began to weaken in September.”
The method of measuring consumer confidence can be very unstable, and consumers are changing their behavior to protect themselves from the deadly virus. Consumers are very cautious about going out, and they prefer to work remotely for a period of time. According to a survey, only 13% of people believe that the economy will rebound to the level before COVID-19; 35% of respondents said that they do not plan to go shopping in a shopping mall this year; about 53% of respondents said they will Reduce the use of public transportation or not use any public transportation.
Even so, sales in June increased by 7.5% compared to May. E-commerce contributed to this growth, and e-commerce sales are expected to soar by 18% this year.
“So, what does this mean for container imports and demand?” Monroe replied: “It may be that as more and more consumers stay at home, they adapt to online purchases. More and more consumers are online Buy all goods, especially daily necessities.”
Overall, 18 trans-Pacific ships returned to the market this month, but freight forwarders reported a slight decrease in their activity.
The following reasons are the main reasons for the current increase in sea freight when shipping from China to the United States:
1 The United States is heavily dependent on Chinese products, and the number of products imported from China to the United States will hardly decrease in a short time. If the United States does not find a reliable and stable source of the supply chain in a short time.
2 Shipping companies operating routes between China and the United States have reduced their shipping volume by 50%. In order to maintain the same profitability in the past, they have to double their shipping charges to ensure revenue. If you import goods from China, Hope to get stable and cheap ocean freight, contact BW, because BW sends more than 1,000 containers every month from various ports in Asia to ports in the United States, BW and many shipping companies such as ONE, HPL, COSCO, ZIM, MATSON, HMM, MSC, MSK, all have their own negotiated prices.
At the same time, in the peak season when importing from China to US，cargo space can be guaranteed. Will not let your goods wait too long.
3 PPE, medical and anti-epidemic materials, and hand sanitizers are importing from China to the US, because the value of the goods is relatively expensive, and the demand is huge, which greatly increases the confidence of shipping companies to increase ocean freight.
When shipping from China to US.this is why the ocean freight from China to the US during the COVID-19 is so high.
4 Because a large number of importers have begun to stock up and purchase many products for the Christmas season because the number of containers in the recent two months is still very large. A large number of imported goods from China are continuously shipped from China to the United States.
5 Even if the cargo volume starts to decrease in September, compared with the high cost of operating a container ship in a single day, shipping companies would rather reduce capacity, use fewer container ships to operate, and adopt a way of sharing space. Get the lowest risk and maximize profit. Because it is expected that the possibility of a reduction in sea freight from China to the United States in the coming winter is extremely high.
6 A large number of shipping companies hire their container space wholesalers in various ports in China, such as BW, for strategic sales of guaranteed space. What does it mean? That is if the high container sea freight from Ningbo to LA is 3000 USD, but if you are not a regular customer or VIP customer of a large container wholesaler in China, if you want to ensure that the goods depart on next Friday and leave the port on time, you need to pay these The additional 500USD of Chinese freight forwarders is used to ensure the cargo space. Of course, you can not pay this additional fee, because you may face the risk of missing the prime time of sales, out of stock or facing the risk of price increase in the next month, and even the next The operation process of voyage and ocean freight is still the same. If you are not a VIP or you have not found a reliable Chinese freight forwarder and you want to ensure that your container leaves the Chinese port on time, you still need to pay additional fees. This is reality.
Maybe these inside stories will make you feel very unhappy, but this is reality. Now contact BW to start a new logistics choice. BW advocates the logistics plan of shipping to the United States from China and other Asian countries, making it more convenient for you. BW commission has a long and deep relationship with us importers. When you ship goods from China to the US, or in the future, possibly from other Asian countries to the US, you can benefit a lot and become a business partner with BW, In the next supply chain transfer process, you may be from Vietnam or Thailand, or Taiwan, Malaysia, Indonesia, the Philippines, Laos, Myanmar, Cambodia purchase, and then shipped to the United States, BW will be your most reliable logistics partner in Asian, you do not need to look for freight forwarders all over the world, because it is very difficult to find a reliable, professional, honest and compliant freight forwarder, contact BW.
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