Logistics: Shipping rates between China and Southeast Asian countries has increased tenfold
MEKSEA.COM – Although shipping demand increases for the Lunar New Year, shipping rates between China and Asian countries have skyrocketed.
According to the Ningbo Container Freight Index, the spot rate of container ships departing from the Ningbo port recorded a price increase over the past month and hit a new record. The freight rates to Thailand and Vietnam increased by 137% from October to early December 2021. Besides, the shipping rates from Singapore to Malaysia also increased by 49%.
Now shipping rates could be a matter of concern for Southeast Asia exporters. (photo: Internet)
Before the pandemic, shipping rates from Shenzhen to Southeast Asia were about $100-200 for 20 feet. Now the price has increased tenfold, about $1,000 to $2,000. Shipping costs to different destinations have increased fluctuated continuously. Besides, the shipping rates to Korea have also increased sharply in the past two months. Now up to 1,600 USD/20 feet container (up about 200 USD).
Analysts say that the fourth quarter is the traditional peak season for intra-Asian shipping routes, due to high demand for the Lunar New Year. But the pandemic has severely affected the global supply chain. In Southeast Asian countries, factories have returned to operation, boosting demand for raw materials. Meanwhile, many shipping companies have directed more vessels for trans-Pacific routes since the third quarter. Shipping demand for Black Friday and Christmas led to booking seats for shorter routes more and more difficult.
According to the carrier Wan Hai, freight rates for intra-Asia routes will increase sharply in December as factories in Southeast Asia have resumed operations. Demand continues to soar and disruptions in Southeast Asian ports are exacerbated.
The next time, the Regional Comprehensive Economic Partnership (RCEP) that will come into effect on January 1, 2022, will herald a new era of Asian trade. Freight rates for the Sino-American routes exceeded $20,000 per 40-foot container in September. Currently, the freight rate for the US West Coast from China is $14,924 per 40-foot container, 285% higher than the same time last year.
Meanwhile, freight rates for East Coast of Asia – US recorded 17,195 USD this week, up 250% over the same period last year. Rising rates and congestion are the result of the epidemic, especially in the context of the widespread Omicron variant.
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By Hayati (Meksea Team)
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