Ports around the world are congested and freight costs are rising as soaring consumer demand is met in the run-up to Christmas. Biden’s plan to save the supply of Christmas goods by clearing cargo at the ports of Los Angeles and Long Beach, California’s two major gateways, seems to have failed, and congestion remains. The number of container ships in the two major ports has reached an all-time high. Now the average waiting time for a container ship to enter these two ports to unload is about 21 days, or 3 weeks, while it only took about 7 days in August. Instead of improving efficiency, it has lower and lower.
Previously, the head of the Port of Long Beach, one of the busiest ports in the United States, said he expected port congestion, one of the important factors causing supply chain disruptions in the United States, to ease in about six months.
It is understood that some importers in the United States have abandoned sea transportation and switched to air transportation to ensure that their products can be put on the shelves in time during the holiday shopping season. However, according to relevant statistics, air freight prices to and from major Asian routes have doubled in the past three months.
The British “Financial Times” reported that the air freight price on the route from Shanghai to North America reached a record high of US$14 per kilogram (approximately RMB 89), much higher than the US$8 per kilogram (approximately RMB 51) at the end of August. Currently, The price has even reached a historical high of US$12 (approximately RMB 76) per kilogram at the beginning of the COVID-19 epidemic. But the additional cost of air freight could put pressure on consumers through inflation.
At the same time, air freight prices for similar routes, such as the route from Hong Kong, China to Europe and the United States, and the transatlantic route between Europe and North America have all seen significant increases.
“Everyone knows that if you want products to be on the shelves before Christmas, you must use air freight.” said Yngve Ruud, global air cargo director of Kuehne+Nagel (Kühne + Nagel), one of the world’s largest freight forwarding companies. A freight forwarder said: “The market expects the peak season and air cargo market demand to continue until March next year.”
The Financial Times analyzed that there are many reasons for the surge in air freight prices:
-
First, global shipping congestion has led to a large number of companies switching to air routes to transport products such as fashion, consumer electronics and components.
-
Secondly, the widespread spread of the COVID-19 “Omicron” strain has created a large demand for COVID-19 testing reagents and personal protective equipment around the world.
-
Finally, global supply chains are extremely busy due to holidays such as Black Friday and Western Christmas.
It is understood that some airlines have turned to undertaking air freight services, and logistics companies such as FedEx and DHL are also filling part of the gap to fully cope with the growing demand for such convenient, fast but expensive services.
Marco Blomens, director of cargo consulting at Seabury Consulting, a subsidiary of Accenture, said that the current aviation industry’s capacity is still 13% less than in 2019, but demand has increased by 6% during the same period, resulting in a nearly 20 percentage point gap between supply and demand. difference. According to the latest statistics and analysis reports, the current chaotic supply chain situation may not ease until the second half of 2022.
</p
