The price of exwork has also been affected by the drop in some shipping rates
Previously high sea freight rates have begun to fall, with some popular routes seeing their rates drop by more than 50 percent year-on-year, as the global logistics supply chain recovers. Industry insiders said the supercycle of shipping has ended and freight rates are expected to accelerate from the second half of the year.
Lower sea freight rates
According to the FBX index published by the Baltic Maritime Exchange, the average price of FBX container seaborn was $6,583 on June 29, down 40.9 percent from its all-time high in September last year. Among them, the China/Far East - North America west coast route freight rate dropped 63.1% from last year's highest freight rate; China/Far East - East Coast of North America freight fell 54.6% from last year's peak; The China/Far East-Nordic route is down 29.4 percent from its all-time high in January and 26.6 percent from last year's peak.
Spot shipping prices fell sharply, even lower than the long-term agreement prices. According to Xeneta, the current spot freight rate for trans-Pacific routes to the U.S. and West is $7,768 per FEU, 2.7 percent lower than the long-term freight rate of $7,981 per FEU.
"It is true that there are some cases where shippers negotiate with shipping companies to revise the long agreement price, but very few shipping companies reduce the price." An official of a domestic shipping company told the China Securities Journal, "Unless the loading rate drops significantly, we will consider cutting prices and taking more orders. But the current loading rate is still at normal levels, reducing prices is illogical. The Christmas stocking period will begin in the third quarter, and capacity will be tight again."
Freight rates fell, and some shipping companies began to cancel sailings to reduce losses. According to new data released on July 1st by Drury, a shipping consultancy, the world's three largest shipping alliances canceled a combined 61 sailings in the next five weeks (27-31). Among them, 2M Alliance and THE Alliance canceled THE most flights, with 23 flights respectively. Ocean Alliance cancels 15 sailings.
Of these, 86 out of a total of 760 scheduled sailings on major routes such as trans-Pacific, trans-Atlantic, Asia-Northern Europe and Asia-Mediterranean were canceled between weeks 27 and 31, representing a cancellation rate of 11%.
Drury doesn't expect spot rates to collapse because airlines will tighten and adjust their availability to reduce volatility in spot rates. Over the next year, shipping lines will have to deal with weak spot rates falling below contract rates.
Factors affecting freight forwarder exwork Freight transportation
In international freight transport, one of the most concerning issues is the price of freight transport. The cost is directly related to the cost of transportation. Because many exporters do not understand the price of transportation very much, and often have a lot of extra spending, then today to understand the factors of the price of international freight transportation?
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The transportation prices are different for different exwork
In the general international trade process, the price of transport according to different modes of transport, price is also different. International freight rates are divided into sea freight, air freight and rail freight.
The specific exwork freight rate can also be subdivided. For example, rail freight can be divided into passenger freight and freight. Shipping rates are also divided into tramp rates and liner rates. Tramp rates are also affected by market supply and demand relations at that time, while liner transport costs are relatively fixed. Airfreight can be divided into general goods, designated goods and special goods, and the specific transportation price is also determined according to the weight of transportation, at the same time, even if the volume is small, the weight is also counted by weight, but if the opposite is large, small weight, also according to the specific volume to calculate.
The choice of international logistics, the quality of logistics will affect the seller's store score, but also affect customer satisfaction rate.
Factors affecting the shipping price of exwork
In the process of international transportation, there are many factors affecting the price of transportation, in addition to some fuel and labor costs, there are many important factors. For example, the nature of the exwork, its own value and packaging form, as well as stowage factor and transporter's requirements for transportation, etc. There will be some fixed costs during the use of the ship, such as the ship's maintenance insurance and fuel consumption. There is also the change of supply and demand in the exwork market. In the transport off-season, transport prices are relatively low, in the transport of the peak season, transport prices will be relatively high.
Logistics advantages of the exwork in the destination country and region
In Eastern Europe, DHL has advantages in Romania, Bulgaria, Moldova, Hungary and other places while EMS has advantages in Greece, Russia, Turkey and other places. Western Europe, Northern Europe, southern Europe can use DHL international express, TNT international express, these two kinds of customs clearance capacity. TNT has a clear advantage in the Netherlands and Belgium.
For Canada, the United States and other American countries, FedEx, UPS and DHL are all suitable for their strong customs clearance capacity and fast time.
Applicable to Asia, South Korea, Japan, Thailand and other Southeast Asian countries DHL, FedEx. DHL and FedEx are time-saving, but THE price of DHL is higher. Indonesia also suggests USING DHL because it has a stronger customs clearance capacity.
In Oceania, DHL and UPS aging fast, with high prices; TNT and FedEx have lower prices but relatively few outlets. Particular attention should be paid to the "Made in China" label on the packaging of Australian products.
Middle East express ARAMEX, EMS for Middle East region. Commercial express in Africa is very expensive. In remote areas, IT is suggested to send EMS international express. EMS countries have the strongest customs clearance capacity. The air express exwork can reach many countries and regions that commercial express and postal express cannot reach, so the wide range of exwork transportation is its advantage.
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