International Shipping Costs Will Be Increased Again From June

Jun 04,2024
Industry News
The surge in demand for containers and the shortage of shipping capacity have made it difficult to find space, and international shipping costs have continued to rise

Recently, international shipping costs have continued to rise, increasing export costs for small and medium-sized foreign trade enterprises. It is difficult to book space, and some routes are "hard to find a cabin", and bookings have been scheduled until mid-June. From container shortages, insufficient capacity to frequent price increases by shipping companies, which have led to the inability to ship goods on time, small and medium-sized foreign trade enterprises face double pressure in terms of cost and timeliness. This article will analyze the reasons for the increase in shipping costs, explore its impact on my country's foreign trade exports, and share some strategies for small and medium-sized foreign trade enterprises to break through.

International Shipping Costs Will Be Increased

Analysis of the reasons for the increase in shipping costs

Improvement in demand in Europe and the United States

Since 2024, marginal improvement in demand in Europe and the United States, and a good foreign trade situation in China, provide basic support for the increase in shipping demand and shipping prices.

Container shortage and insufficient capacity

In the first four months of this year, my country's import and export volume of goods trade increased by 5.7% year-on-year, and increased by 8% in April, exceeding market expectations. Affected by the recovery of global trade, container demand has surged, while capacity supply is insufficient, resulting in difficulty in finding space and backlog of goods. The shortage of available containers, especially for China's exports, has led to a surge in demand for limited transportation capacity. Factors contributing to this shortage include traffic congestion, suspension of voyages, and increased demand in South America.

Shipping companies raise prices

Freight rates have skyrocketed, with freight rates from Asia to certain regions in Latin America rising from more than $2,000 to $9,000 to $10,000. Many shipping companies have issued price increase letters, with rates on major routes rising sharply, and freight rates on some routes almost doubling, bringing huge cost pressure to foreign trade companies.

Global supply chain instability

Tensions in the Red Sea have caused cargo ships to detour around the Cape of Good Hope, significantly increasing route distances and sailing days, driving up shipping prices. Congestion at ports in many countries and rising international fuel oil prices have jointly pushed up shipping costs.

Countermeasures for small and medium-sized foreign trade companies

Diversified transportation methods

Companies can explore alternative transportation methods such as air transport and China-Europe trains, or adopt more economical transportation methods such as high cabinets to cope with the problems of insufficient shipping capacity and rising prices.

Advance planning and inventory management

Book space in advance to cope with container shortages and insufficient capacity. Foreign trade enterprises should plan shipments in advance and send goods to overseas warehouses in advance to cope with the extended transportation time and peak shipments during the peak season. At the same time, strengthen inventory management to avoid backlogs of goods.

Optimize production processes

Shorten front-end production time, reduce inventory costs, and speed up the turnover of goods by adding production lines and improving production efficiency to adapt to the extension of the transportation cycle.

Actively seek policy support

The government should increase support for small and medium-sized foreign trade enterprises, provide tax incentives, financing support and other policy measures to help enterprises tide over the difficulties.

Forward inventory strategy

Send goods to overseas warehouses in advance and then transfer them to destination warehouses to reduce operating costs.

The increase in shipping costs reflects the partial recovery of global foreign trade, but it also brings cost and timeliness challenges to foreign trade enterprises. According to experts' predictions, although shipping prices fluctuate in the short term, as the cycle passes, prices will fall back, and foreign trade enterprises need to respond flexibly and take proactive measures to remain competitive.

During this period, foreign trade enterprises need to remain vigilant and adjust their strategies in a timely manner to cope with the constant changes in the market. Through diversified transportation methods, advance planning and inventory management, and optimized production processes, we can reduce costs, improve efficiency, and ensure the steady development of the company.

Faced with the rising shipping prices and tight shipping capacity, cooperation with professional international logistics and transportation service providers has become a wise choice for foreign trade companies. As a professional international logistics and transportation service provider, shopv has many years of industry experience and a rich resource network, and can provide you with a full range of logistics services.

Shopv can provide you with customized logistics solutions to ensure that the goods arrive at the destination on time and safely. Provide a variety of transportation methods such as sea, air, and land transportation to meet different logistics needs. In the case of rising shipping costs, shopv can recommend more economical and more suitable transportation methods to you and reduce your transportation costs.

With a complete transportation management system, it can monitor the transportation of goods in real time and provide you with timely transportation information. Through professional supply chain management, help companies optimize inventory, reduce backlogs, and speed up capital turnover. In addition, shopv can also provide a series of value-added services such as customs declaration, insurance, and warehousing according to your needs to make your logistics smoother and more convenient.

The increase in shipping costs has brought considerable challenges to foreign trade companies, but as long as we respond proactively and choose the right logistics service provider, we can reduce risks and ensure the timely arrival of goods. Here, we sincerely invite you to contact shopv and let the professional logistics team escort your goods. No matter what logistics problems you face, shopv will serve you wholeheartedly!

Contact ShopV

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