Can the freight rate be restored to a reasonable range after the gradual recovery of foreign trade exports

Since the outbreak of the epidemic this year, Chinese and foreign shipping companies have predicted that China's exports will decline sharply, and then they have reduced the number of voyages of export containers and substantially disassembled container ships. With the gradual recovery of export transportation demand in the second half of the year, the greatly reduced shipping capacity can no longer meet the demand. Since June, the sea freight price has started to soar, especially the trans Pacific route. According to the Ningbo shipping exchange, the market freight rates of the western and Eastern routes of the United States have risen to the highest level since 2019.

Since the epidemic, it is difficult for foreign trade enterprises to survive. The sharp increase of shipping company's freight is undoubtedly adding to the difficulties for small and medium-sized foreign trade enterprises. However, some netizens believe that the epidemic is serious, the risk of ocean shipping is high, and the artificial price hike is reasonable. China's foreign trade exports have been gradually restored, calling for freight rates to be reduced to a reasonable range. The boss of a small and medium-sized foreign trade enterprise said: "it's really not easy for foreign traders in 2020. Now the shipping company's freight has increased substantially. It's basically necessary to confirm with customers before making CIF orders. Although a lot of foreign trade is FOB, but also because shipping companies just want to accept high prices, they have been dumped, and even some factories directly say that you are in a hurry to raise the price by US $1500-2000. We will give you the price. "

"Novel coronavirus pneumonia epidemic in the global development and trend is an important variable for the future of the shipping industry," said Ding Meng, an economist at Hongkong Bank Financial Research Institute. The shipping industry should also follow the market-oriented pricing method. Therefore, it is not unreasonable to reduce the transportation capacity from the perspective of the expected future demand decline. If the transportation capacity is increased rashly in the current highly uncertain environment, it is not the market-oriented way to determine the allocation of resources. Under the effect of market supply and demand, if the freight rate is too high, the demand for natural shipping will decline, thus forcing the shipping enterprises to reduce their prices. If the non market-oriented way is adopted to increase transport capacity in the case of loss, it will damage the long-term development of the industry and will not really find a reasonable balance point of transport capacity. " ~Since the outbreak of the epidemic this year, Chinese and foreign shipping companies have predicted that China's exports will decline sharply, and then they have reduced the number of voyages of export containers and substantially disassembled container ships. With the gradual recovery of export transportation demand in the second half of the year, the greatly reduced shipping capacity can no longer meet the demand. Since June, the sea freight price has started to soar, especially the trans Pacific route. According to the Ningbo shipping exchange, the market freight rates of the western and Eastern routes of the United States have risen to the highest level since 2019.

"Novel coronavirus pneumonia epidemic in the world is an important variable in determining the future of the shipping industry," said Ding Meng, an economist at Hongkong Financial Research Institute. The shipping industry should also follow the market-oriented pricing method. Therefore, it is not unreasonable to reduce the transportation capacity from the perspective of the expected future demand decline. If the transportation capacity is increased rashly in the current highly uncertain environment, it is not the market-oriented way to determine the allocation of resources. Under the effect of market supply and demand, if the freight rate is too high, the demand for natural shipping will decline, thus forcing the shipping enterprises to reduce their prices. If the non market-oriented way is adopted to increase transport capacity in the case of loss, it will damage the long-term development of the industry and will not really find a reasonable balance point of transport capacity. "

Source: Port circle