In 2020 and 2021, we experienced jaw-dropping freight rates. Many importers decided not to place orders since the shipping costs were too high. At the end of 2021, the situation stabilized, and we can see that freight rates drop. So, what is up with the freight rates?
Shipping from China – in the past and now
International shipping cost from China (or any country for that matter), regardless of the mode of transportation, has been high for many months. That is why shipping lines gained astronomical profits in 2020 and 2021. Since freight rates were high, importers were holding off placing orders, waiting for the situation to normalize. The moment has come; we can see freight rates decline at the end of 2021.
Here we have some freight rates comparison as of 2021:
- Ocean freight LCL, Shenzhen – Warszawa, 20 CBM
- July: transit time 41 days; 4120 USD
- October: transit time 40-45 days; 3800 USD
- Ocean freight LCL, Ho Chi Minh – Seattle, 2 CBM
- transit time 30 days; 800-900 USD
- Ocean freight FCL, Tianjin – Gdansk, 40’HC
- July: transit time 44 days; 18510 USD
- October: transit time 43 days; 16110 USD
- Ocean freight FCL, Izmir – Amsterdam, 40’HC
- transit time 28 days; 13100 USD
- Ocean freight FCL, Busan – Hamburg, 40’HC
- transit time 31 days; 14090 USD
- Rail freight LCL, Shanghai – Zielona Góra, 13,14 CBM/780 kg
- July: transit time 23 days; 4600 USD
- October: transit time 24-25 days; 3500 USD
- Rail freight FCL, Jing’ an – Gdansk, 40’HC
- July: transit time 20 days; 17000 USD
- October: transit time 19-20 days; 15900 USD
- Airfreight, Yiwu – Cracow, 200 kg
- July: transit time 10 days; 7090 USD
- October: transit time 10-12 days; 6900-7090 USD
These examples prove that shipping costs fell and fluctuate between a thousand to a dozen or so thousand USD. It should be noted that they will not plunge to the 2019 level anytime soon. There are still some disruptions in the chain supply, like short-staffed ports and distributions centers. Freight rates are even 20 times higher than before; fortunately, the situation is getting better.
Freight rates drop; is it a good time to import?
The drop in freight rates is due to China’s coming off-season and a reduction in manufacturing because of the power crunch. Since manufacturers in many provinces halt production, speculators sell their shipping spots, and prices drop. There are more boxes available, but the ports are still congested. Even if the situation gets on track, we can expect the prices to drop even more.
Importers were waiting for the shipping costs to drop. Now is the time to import from China, especially before the prices increase due to the fast-approaching Chinese New Year. On ShipHub.co, you can see updates on transportation. Make sure to read our forecast of transportation and logistics for 2022!