Starting from the port in China, passing through Singapore, sailing across the Indian Ocean to the Red Sea, and then entering Europe through the Suez Canal, this is the only way for Chinese goods to communicate with the European market.

However, since mid-December 2023, Houthi armed forces have attacked shipping vessels, blocking the important "choke" of the Red Sea. More than a hundred ships laden with containers have been forced to detour around the Cape of Good Hope. The time for trade between Asia and Europe has increased sharply, and transportation The cost doubled in less than a month.

Under the "black swan" incident, some domestic foreign trade companies have been deeply troubled by logistics delays, and industrial resilience is facing challenges again.

Container prices nearly triple

In the past half month, Ma Xiao (pseudonym) has been busy and anxious. "The goods are still floating on the sea and are expected to arrive 15 days later than originally." Ma Xiao is the person in charge of a supply chain management company in Shenzhen, acting as an agent for import and export business for foreign trade companies. The cargo that is still floating at sea was shipped from Yantian Port to Rotterdam in the Netherlands in mid-December 2023. According to the original plan, it should be able to arrive in the near future. However, after the cargo ship was forced to detour around the Cape of Good Hope, the voyage distance and time have increased a lot. . "The time and freight have increased, and this batch of goods has not been delivered yet. It is estimated that the next orders will decrease." Ma Xiao has been busy explaining and discussing better plans with customers recently, while thinking about how to deal with this sudden "blackout". Swan" incident.

The Red Sea crisis has blocked the passage of merchant ships and forced them to take detours, which will inevitably lengthen the transportation time. According to data from energy intelligence agency Vortexa, sailing times on major routes from the Middle East to Europe and from India to Europe would increase by 58% to 129% if merchant ships detoured around Africa's Cape of Good Hope. Among them, the largest increase in the time required for goods to reach their destination was the Middle East Gulf to Mediterranean route, which increased by 129%, from 17 days to 39 days.

At the same time, the overall cost of transportation has also risen. "We have four containers going from China to Morocco. The difference between the current quotation and the price quoted at the beginning of December last year is more than 100,000 yuan, which is equivalent to an extra 2-3 US dollars for each product." Running a small home appliance export business in Foshan, Guangdong Mr. Li told reporters.

Yu Guizi, senior sales manager of Shenzhen Yisu Xinda Supply Chain Co., Ltd., told reporters: "The price of shipping a container used to be US$2,300-2,400, but now it is conservatively estimated to be around US$6,500."

The reporter inquired and learned that the stock prices of the four major shipping companies Maersk, Hapag-Lloyd, Mediterranean Shipping Company and France's CMA CGM have all been affected by logistics congestion and have risen one after another. For example, Maersk's stock price has risen since the "Red Sea Crisis" incident. About 40%; since the beginning of December last year, Hapag-Lloyd’s share price has also risen by more than 40%.

At the same time, market expectations for rising freight rates continue to rise.

According to the latest real-time freight data provided by GeekYum, taking the route from Shanghai Port to Hamburg Port in Germany in January as an example, various shipping companies quoted different prices. Among them, Mediterranean Shipping Company's 352W voyage quoted 5540 US dollars/TEU, and Maersk's 401W voyage quoted 4703 US dollars/TEU. TEU, Evergreen's 0690-047W voyage is quoted at US$5,260/TEU. CMA CGM's price for the 0FLGPW1MA voyage on January 15 was as high as US$7,077/TEU.

In terms of container shipping index, data provided by the Shanghai Shipping Exchange shows that as of January 5, 2024, the Shanghai export container freight index was 1896.65 points, an increase of 7.79% from the previous period.

According to the reporter’s understanding, we are currently in the negotiation season for European line length contracts, and the rising freight rates will increase the carrier’s bargaining chips to a certain extent. "Competition in the freight forwarding industry is fierce, and the transparency of the shipping price market is very high. Even if a freight forwarding company increases, it will only increase slightly, and cargo owners will definitely look for the company with the highest cost performance." Yu Guizi said.

For the freight forwarding/logistics industry, the current consideration may not be whether they can take advantage of the opportunity to increase prices, but how to prevent orders from being lost. "Orders will decrease. Even if a single fee is increased, profits may not be able to fill the gap in the decline in orders." Ma Xiao told reporters that due to the increase in overall freight rates and increased maritime uncertainties, customer demand and cargo owners' delivery plans may be affected. There will be variables.

Enterprise production order may be disrupted

The cross-border industry chain is closely linked. As long as one link is blocked, the upstream and downstream cannot operate smoothly. The outbreak of the Red Sea shipping crisis has caused some small and medium-sized foreign trade companies that export products to Europe to once again feel the difficulties caused by logistics obstruction during the epidemic. labor pains.

On the one hand, the cost of comprehensive logistics such as containers has increased, and either buyer or seller has to "pay" for it. The reporter learned from the interview that if the cargo owner and the customer adopt the FOB cooperation model, risks such as rising sea freight will basically be borne by the customer. "Buyers bear the increased freight costs, which also means that their purchases may be reduced, and our order volume will also be reduced." Zhang Ming (pseudonym), the head of a building materials company exporting to Europe in Foshan, Guangdong, told reporters that the increase in freight costs has superimposed Due to some uncertain safety factors, some customers are already hesitant to reduce order quantities.

Another situation is to settle under the CIF model, that is, the seller bears the logistics costs. Although the rising costs will eventually be passed on to buyers in other ways, for some small and medium-sized enterprises, it seems that they do not have much bargaining leverage. "Domestic factories, especially those that produce low value-added goods, are often relatively weak when doing business with European buyers. Even if they want to increase prices, they will not be able to increase much, and they may eventually lose profits." Yu Guizi A reporter told reporters that for small and medium-sized enterprises that adopt this settlement model, rising freight rates will inevitably increase their pressure. "The value of a box may only be 10,000 US dollars, but now the shipping costs will cost 6,000 to 7,000 US dollars. It is difficult to afford products with low added value." Yu Guizi said.

Industry insiders who communicated with reporters generally believe that if the crisis continues to ferment, the "ceasefire" time remains uncertain, and shipping detours increase shipping costs and extend delivery cycles, buyers may face two extreme situations: one is due to If the goods cannot be put on the shelves for sale as scheduled, some European buyers may abandon the goods, cut orders or reduce demand; on the other hand, because European buyers do not have the habit of stocking up in advance, some buyers may increase their purchase plans in the near future, resulting in short-term Domestic demand increases. No matter which situation occurs, it will disrupt the normal production and shipment rhythm of the company to a certain extent.

"If purchases are increased, the manufacturer will have to increase funds to buy more materials, and the factory's capital operating costs will rise; if orders are suddenly reduced, the manufacturer's materials prepared in advance will accumulate, warehouse rent will increase, and workers will not be able to start work, especially for agents. For industrial enterprises, this batch of goods has not been delivered, and it is still a question whether to continue production in the future." Lin Wensheng, executive vice president of the Shenzhen Chamber of Commerce for Import and Export, told reporters that on the surface it only disrupts the rhythm of logistics, but in fact it disrupts the order of the entire supply chain. All were disrupted.

Some people in the industry believe that at the end of the year and the beginning of the year, many domestic foreign trade companies are trying to rush shipments in order to collect payment as soon as possible, which may lead to a situation where "a box is hard to find". "We have customers who want to ship goods from China to Italy, but there are no good prices and positions now, and the Mediterranean lines are all out of stock." Yu Guizi said that if the armed incidents continue, the positions will definitely become increasingly tight.

However, according to the reporter’s understanding, judging from the transport capacity throughout last year, both the number of ships and containers are currently in excess. Why is there a tight position? Someone in the cross-border logistics industry told reporters that tight positions are more of a kind of "hungry marketing" by shipping companies. "Especially during busy times and when some uncontrollable events occur, shipping companies will suspend sailings or stock up on warehouses. The purpose of creating a situation of tight positions is to increase prices." The person said that in fact, in the past year, major shipping companies have tried to increase prices many times, but the effect was not obvious, but this time it really increased. Woke up.

China-Europe freight trains are fully booked in advance

Although the navies of various countries have stepped up patrols and protection in the Red Sea waters, it is difficult to completely eliminate the risk of attacks on merchant ships. Merchant ships have had to re-evaluate their cargo transport options and choose safer routes.

From the perspective of transportation methods and routes, some people in the logistics industry told reporters that in addition to detouring around the Cape of Good Hope, some companies choose a mixed air-sea transport method, that is, first transport the goods to the Middle East by sea, and then transport the goods by air from there. destination. In addition, some customers with urgent shipments will choose air or China-Europe freight trains.

The reporter learned from public information that currently, all freight railway slots in January are fully booked, and the earliest booking service date for China-Europe trains on the SOFreight website has been scheduled to January 31.

Yu Guizi also admitted that most of the products that choose China-Europe freight trains or air transport are time-sensitive and have high added value. "Things that go by sea are generally low-value-added items such as daily necessities, clothing, shoes and hats. Once they come out, there are dozens of containers. Although the volume is large, the profit is very thin. I am afraid it will be difficult to pay for the China-Europe freight trains and air freight." In addition, , some people in the industry pointed out that the capacity of China-Europe freight trains is limited and is not in the same order of magnitude as the capacity of sea transportation.

In terms of commodity prices, the Red Sea is one of the important shipping channels connecting Asia and Europe. Many commodities, such as oil, natural gas, chemical products, metal ores, grain, etc., are transported through this waterway. The increase in transportation costs may be passed on to Commodity prices, therefore, some people in the industry believe that some commodities may increase in price.

However, commodity prices have been less volatile. For example, the Red Sea region is close to several major wheat-producing countries, and wheat transportation has been greatly disrupted. However, wheat futures have risen 5.2% since the Red Sea crisis, and the fluctuation range is not very large. Brent crude oil futures rose slightly by 3% after the incident and are currently below the level before the incident, at $78.9. Iron ore futures rose 5.9%.

Domestic small and medium-sized enterprises also lack the motivation to significantly increase commodity prices. "If the seller is very strong, they will increase their prices accordingly, but most domestic small and medium-sized enterprises that cooperate with European hypermarkets cannot increase much. In the past three years due to the epidemic, shipping prices have increased tenfold, but the selling prices of goods have only increased slightly." Lin Wensheng said.

[Reporter’s Observation] Red Sea shipping crisis tests my country’s industrial resilience

On the surface, the Red Sea shipping crisis caused by armed incidents is the same as the three-year epidemic and the Suez Canal ship blockage incident. Logistics blockage has led to rising freight rates and conflicts between supply and demand of shipping resources. However, the two occurred in different trade environments. , the impact on the industrial chain and supply chain has different underlying logic.

Specifically, during the three-year epidemic period, due to China's implementation of strong epidemic prevention measures, domestic production was basically able to resume normal operations, and no large-scale industrial transfers occurred during this period. Therefore, even if global logistics was poor and important fortresses were blocked, As a result, freight and prices rose accordingly. Overseas markets, including the European market, still needed China's production capacity. At that time, the demand was obviously greater than the supply.

Now that the epidemic is over, after two years of adjustments, countries have fully resumed work and production, and supply has fully recovered. However, at the same time, the market is facing weak demand and weaker expectations. The global market is in a situation of oversupply. In addition, Due to comprehensive factors such as the Sino-US game, the domestic industrial chain has shifted outward to a certain extent. In other words, with more choices and less demand, and when shipping prices rise due to logistics obstruction, buyers can choose to postpone their purchase plans, adjust their purchase structure and quantity, or choose a more cost-effective and competitive option. Powerful seller.

Therefore, in the final analysis, commodities determine purchasing power. In interviews with reporters, many industry insiders mentioned that many of the domestic goods currently shipped to Europe by sea are daily necessities, clothing, shoes and hats, electronic equipment, plastic products, home building materials, chemical products, etc. Most of these goods The added value is low and the profit is thin. If the route is diverted or replaced by railway and air transportation, the cost will be increased to varying degrees, profits will be further compressed and even losses will be incurred. For this type of product, the Red Sea crisis or every future navigation safety incident will put it into a passive situation.

For this Red Sea crisis, companies need to think about countermeasures in the short term, but the real test in the long term is the resilience of my country's industrial chain. How to calmly deal with every force majeure variable? Perhaps the fundamental solution lies in industrial upgrading, that is, reducing reliance on low value-added products and developing high-end manufacturing that is less sensitive to price and cost.

What products are less price sensitive? Automobiles, new energy products, high-end consumer electronics, semiconductors, high-end industrial equipment, etc. According to the reporter's understanding, in addition to cars, some other products with higher added value will choose railway and air transportation. However, large-ticket products with higher added value such as cars will not be transported even if they take a longer detour on the sea. The energy costs afford the time and shipping costs.

It is worth mentioning that since 2023, under the background of China's overall foreign trade situation being under pressure, the traditional "three old" exports of clothing, furniture, and home appliances have declined, but new energy vehicles, lithium batteries, and photovoltaic products have led to a decline. The representative "three new items" are rising against the trend and outperforming others. Data show that in the first three quarters of 2023, the total export volume of the "three new products" was 798.99 billion yuan, a year-on-year increase of 41.7%. This is the "fruitful result" of China's efforts to optimize its industrial structure in recent years.

As a new driving force for foreign trade exports, the "Three New Things" have pointed out a new market direction for foreign trade merchants. Made in China is accelerating towards "intelligent manufacturing" in China. Relying on China's long-term accumulation of manufacturing capabilities and strong advantages in the industrial chain, the foreign trade industry should seize the wave of digital transformation and the opportunities of green and low-carbon transformation to respond to everyone's needs with more competitive products. Amid uncertainty in global trade, we have gained greater say and initiative in global trade, demonstrating the resilience of our country's industry with a new look.