Causes and consequences of the imbalance of container equipment in the world

For almost a year now, the situation in the sector of sea and railway transportation from the region of Southeast Asia to Russia cannot be called stable. The situation is caused by global trends related to the imbalance of containers in Southeast Asia and the limited infrastructure capacity of the terminals of the Vladivostok Sea Port, the volume of cargo handling in which increased 5 times over the period 2020-2021.

Experts also attribute the current situation to the uneven recovery of the global economy in a pandemic. China ships far more goods to the US and Europe than vice versa. China’s economy recovered faster, as the epidemiological situation on its borders was almost under control in the second quarter of last year. As a result, containers get stuck in the West when they are really needed in Asia. At the same time, it is also difficult to build more containers: the pandemic has hit the steel and lumber industry, which is necessary for their production.

The shortage of containers became known in December last year. The imbalance of China’s trade with the US and Europe has increased even more: China has stopped buying goods from the US, and the US continues to buy from China, as a result, containers go to America and do not return back. This is fraught with a shortage of goods from China, such as electronics, as well as rising prices and longer delivery times. That is, the shortage of containers could happen, in particular, due to pent-up demand caused by the pandemic.

The situation with the Ever Given container ship that ran aground in the Suez Canal at the end of March 2021 exacerbated the imbalance. Due to shifts in the schedule of a huge number of ships, the work of ports in Europe and China was disrupted, and many ships simply missed their calls, thereby increasing the shortage of equipment and carrying capacity. The terminals in the ports of arrival could no longer cope with the timely processing of non-scheduled ships, which, in turn, affected the regularity of the feeder ships’ schedule and, accordingly, the accumulation of containers in the ports of transshipment. And this, in turn, leads to an increased waiting period for the export of containers from ports of departure.

As an alternative to shipping by sea, logistics providers are increasing the volume of cargo transported by rail, which leads to increased demand for this service and leads, again, to a lack of space and higher rates. The lack of free railway platforms at the Manzhuli/Zabaikalsk checkpoint creates additional waiting time for containers. Failures in the schedule create an accumulation of cargo at the stations of arrival, increasing the time for the removal of containers from the stations to the address of the consignees.

The number of road shipments in the direction of China – Russia is also growing, where some shippers have moved in the hope of avoiding problems on sea and railway routes, but also faced a shortage of capacities in this sector. To date, the queue at the automobile checkpoint from China is about 250 trucks. The trend of maintaining high import rates of sea freight on routes from Asia, as well as the cost of railway transportation, will continue.

As practice shows, forecasts in such a situation cannot be accurate, since even a single incident, for example, a traffic jam in the Suez Canal, or a typhoon off the coast of China, or the collapse of a bridge on a section of the Trans-Siberian Railway in the Sretensky District of the Trans-Baikal Territory as a result of bad weather, etc., may affect market conditions and make changes in the development of the situation.

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