Since March, the geopolitical conflict not only caused the sharp rise and fall of global commodity prices, which had an impact on the downstream manufacturing industry, but also inevitably increased the risk factors of cross-border trade and freight market.
The reporter of securities times · e company recently interviewed China Europe trains, cross-border trade enterprises and people in the logistics and transportation industry in many places in China. It was learned that at present, the transportation in conflict areas and even surrounding related places is limited, superimposed on the impact of the global epidemic, resulting in rising freight rates, extended transportation period and other uncertain factors. However, most people in the industry believe that with the easing of geographical problems, freight logistics will eventually return to normal, and the market prospect of the transportation industry is still good in the long run.
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China Europe train shipment affected
In March 2011, the first China Europe train was sent from Chongqing to Duisburg, Germany, opening a new chapter in the LAND-TO-LAND freight trade between China and many European countries. Two years later, in 2013, the China Europe train in Dalian port also officially started.
As the operator of Dalian port China Europe train, Liaoning Port Co.Ltd(601880) recently announced that from January to February 2022, Dalian port directly issued China Europe train with 18 trains and nearly 1900 TEUs, an increase of 80% and 69% respectively year-on-year.
"However, since March, the export volume of China Europe train in Dalian port has decreased significantly, and the demand and willingness to ship have gradually decreased, resulting in great fluctuations in freight rates." Liaoning Port Co.Ltd(601880) relevant person in charge said in a recent interview with the reporter of the securities times · e company that the outbreak of the conflict between Russia and Ukraine had a significant impact on the China Europe train. On the one hand, taking the Russian train as an example, after the European and American sanctions on Russia, the Russian settlement was affected, resulting in customers withholding goods without receiving the payment. The rapid depreciation of the ruble also made the trade unable to carry out normally, resulting in serious wait-and-see mood among customers. On the other hand, European trains are also affected by European and American sanctions. Some international freight forwarders are worried about being affected by the sanctions. The goods originally shipped by railway are shipped by sea.
With its superior geographical location, strong cargo collection and distribution capacity, as well as a smooth and convenient domestic and foreign trade route network, especially the rich near ocean routes, which can connect Japan, South Korea, Taiwan and Southeast Asia, Dalian port provides convenient conditions for the transit of goods to Russia and Europe. Especially after RCEP takes effect, the radiation and attraction to the region are further enhanced. The commodities with the largest export volume involve electronic accessories, commercial automobiles and accessories, mechanical equipment, daily necessities, etc. the main export destinations are Russia, Belarus, Germany and Poland.
According to the statistics of Liaoning Port Co.Ltd(601880) aspect, 120 Dalian China Europe trains were operated in 2021, with a total container volume of 12000 TEU, a total cargo value of 280 million US dollars and a total cargo weight of 100000 tons. Among them, 24 Transit commercial vehicles and 4070 commercial vehicles have been transported in Central Asia.
However, according to the person in charge of Liaoning Port Co.Ltd(601880) above, after the outbreak of the global epidemic in early 2020, foreign trade shipping was affected, resulting in problems such as delayed shifts, port hopping, tight shipping space, high prices and so on. At the same time, due to the rapid growth of global demand, China's export goods are growing rapidly, and some traditional marine goods flow to China Europe trains, resulting in the long-term tension of railway shipping plan, the difficulty of obtaining first class trains, soaring prices and channel congestion. As a result, the transportation time is gradually reduced and the waiting time of goods is too long, which has an impact on the target source of goods originally suitable for railway shipment.
"Therefore, although the epidemic has brought temporary prosperity to China Europe trains and increased the apparent volume of goods, it has also pushed up the transportation price. In addition, it is worth noting that the service quality and transportation efficiency of China Europe trains have been seriously affected." He confessed.
According to the website of China Railway Group, at present, China and Europe have formed three major railway transportation channels: West, middle and East. The west channel is connected with Kazakhstan and Russia railways at Xinjiang Alashankou (Horgos) railway port through Longhai and Lanxin lines; The middle channel is connected with Mongolian and Russian Railways at Erlianhot railway port in Inner Mongolia through Beijing Guangzhou railway, Beijing Baotou railway and Ji'er railway; The East passage is connected with Russian Railways through Beijing Shanghai, Beijing Harbin and Binzhou lines, Manzhouli railway port in Inner Mongolia and Suifenhe railway port in Heilongjiang, and reaches other countries in Europe through railways in Belarus, Poland and other countries.
The current geopolitical conflict has brought varying degrees of impact on the operation of China Europe trains in many places across the country.
It is understood that the China Europe Express Shanghai originally had four stable trains per month. Because some enterprises had to collect goods again after removing the cabinets, the first train of this month was postponed to March 17.
Ganzhou international dry port China Europe train said earlier this month that the conflict areas are mainly concentrated in Ukraine, and the trains passing through Ukraine at Ganzhou international dry port have been rerouted under the communication and coordination of various parties. The train originally scheduled to leave Ganzhou for Budapest on March 4 opened as usual after the change of route.
The relevant person in charge of a train operation company told the reporter of securities times · e company that at present, the company's line from Alataw pass to Germany has basically stopped running, but the number of flights to Russia and Central Asia has increased, and the overall operation frequency has not changed.
However, the reporter also learned from Xi'an International Dry Port multimodal transport Co., Ltd. that since the conflict between Russia and Ukraine on February 24, 2022, the China Europe train (Chang'an) has operated normally. At present, there are 9 trains that have arrived in Europe, including 2 trains in duburg, with an average overseas time limit of 11.9 days; 2 trains in Hamburg, with an average overseas time limit of 11.1 days; Malasevic 4 trains, overseas prescription 7.9 days; NIUs train 1, overseas prescription 12.3 days.
In addition, a person from Chengdu China Europe train freight company also said that because there is no line involving Ukraine, the safety of China Europe train is guaranteed, and there is no great impact for the time being. At present, it is in normal operation. However, affected by the epidemic and war, the freight rate decreased slightly compared with last year. Take Chengdu to Duisburg as an example. At present, the container freight of electronic products without batteries is about 12000 US dollars, and the container rent is more likely to drop to about 10900 by April.
Chengdu International Railway Train Co., Ltd. pointed out that it has paid close attention to the impact of geographical events on China Europe trains and closely contacted railway companies along the line and overseas transportation agents. Malasevic port is an important distribution hub for China Europe trains entering Europe and an important operation point for container reloading. Most of China Europe trains are transported through this port. According to the latest information feedback, up to now, all stations in malasevic are in normal operation, and the operation of the train at malasevic port will not be affected temporarily.
Zhao Xiaomin, an express logistics expert, believes that in key regions such as Henan, Chongqing, Chengdu, Xinjiang, Heilongjiang and Zhejiang, where China's central European trains are doing well, most of the transportation routes involve central and Eastern Europe and are still affected to some extent. The war will have a certain impact on trade security, settlement methods and settlement prices.
Bai Ming, deputy director of the International Market Research Institute of the Research Institute of the Ministry of Commerce, told the reporter of the securities times · e company that after the outbreak of the conflict between Russia and Ukraine, the uncertainty of the operation of the China EU train has increased. Although some China Europe trains pass through Russia and Ukraine, the proportion of China Europe trains passing through Ukraine is not particularly high.
Judging from the current public information, there is no news of the suspension of China EU trains. Next, the impact of the Russian Ukrainian conflict on the China EU train will mainly depend on the further progress of the Russian Ukrainian conflict, especially whether there will be substantive progress in the negotiations between the two sides.
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the cross-border trade involving Europe is in a dilemma
In recent years, one of the "one belt, one road" initiative has promoted the comparative advantage of China, Europe and Europe in terms of age, price, transport capacity and safety, and has become another important logistics mode between China and Europe. According to previous information from the General Administration of customs, in 2021, the first "Gangtie No." China Europe sea rail intermodal train departing from Guangzhou Port Company Limited(601228) sailed through Alashankou and reached the destination in 16 days, which was more than 60% shorter than the shipping logistics time.
According to statistics, from 2016 to 2021, the annual number of China EU trains increased from 1702 to 15183, with an average annual growth of 55%; The category of transportation goods has expanded from the original IT products such as mobile phones and laptops to more than 50000 kinds of auto parts and complete vehicles, chemical industry, electromechanical, grain, wine, wood and so on; The annual transportation value increased from US $8 billion to US $74.9 billion, an increase of nine times, and its proportion in China EU total trade increased from 1.5% to 8%.
However, under the influence of geographical conflicts, some "old customers" of China Europe trains have to give up this relatively economical and applicable mode of transportation in the past.
\u3000\u3000 "Many of our products are imported from the EU. Now Russia and many European countries impose sanctions on each other, and the China EU train needs to pass through Russia, so it is inevitable to be affected. For example, we often import milk from Poland, but now we dare not transit through Russia, so many peers do not order containers for the China EU train in order to avoid risks. The flight cost is too high, except for particularly valuable goods, Generally not. For low value products such as food and daily necessities, we mostly choose Qingdao Port International Co.Ltd(601298) , and transport them by sea. " Li Jian (a pseudonym), who operates the import business in Zhengzhou, lamented that he has been engaged in foreign trade business for decades and has faced the most and the most difficult problems in the past two years. In 2020, the covid-19 pneumonia epidemic spread all over the world. Almost all products in our store were stopped for a time, the shelves were empty, and many peers fell down. In the past two years, although the supply of goods has gradually recovered with the normalization of the epidemic, the cross-border transport capacity of sea, land and air has remained tight, and the freight rate has remained high.
"Although at present, the war between Russia and Ukraine has little impact on us after the goods are transferred to sea, many shipping companies have transferred due to the bad market in previous years, and the remaining industry giants have insufficient shipping capacity. The shipping price has soared in recent two years, and the cost has increased. Now in troubled times, traders can't understand the market, so we can only make goods according to their abilities." Li Jian said that under the Russian Ukrainian war, in addition to logistics problems, traders also need to face risks such as exchange rate fluctuations and sudden changes of partners, which have a more obvious impact on the industry. "In addition to Europe, our imported goods mainly come from Australia and other places, and there will be some in Southeast Asia, so the overall impact is not obvious, and the containers that arrived before can still maintain operation. However, if this war situation lasts longer, the impact is hard to say." He said.
"At present, the duration of geographical conflicts is relatively short, and most of the freight forwarding industry will encounter similar situations on a daily basis. For example, there are no people receiving goods at the port of destination and customs clearance is impossible. Under the influence of the war between Russia and Ukraine, such problems will be relatively more prominent and intensive." Fei Lili, a lawyer of Shanghai siweilema law firm who has long paid attention to the freight forwarding industry, told the reporter of the securities times · e company that at present, the freight logistics throughout Ukraine will be affected, and the Russian region is more affected by the sanctions of some countries. In fact, if there is great uncertainty about whether the goods can be delivered to the relevant destination after customs clearance, it is more difficult to get through the relevant destination.
She said that under the current situation, not only some logistics are limited, but also some multinational companies are facing difficulties. For example, for a multinational enterprise headquartered in European countries, its European headquarters should impose embargoes and sanctions on Russia according to the orders of the local government. At the same time, the headquarters also issued instructions requiring Chinese subsidiaries not to export goods to Russia. However, for companies in China, they are the main body of independent operation and should be responsible for Chinese customers. It needs to be carefully weighed whether to comply with the prohibitions of European governments.
"From a legal point of view, Chinese subsidiaries should not be subject to the prohibition of European governments, but from the perspective of internal management, overseas subsidiaries also have the obligation to comply with the instructions issued by the headquarters. If Chinese subsidiaries do not comply with the prohibition of European governments, European headquarters will inevitably be punished. However, if they want to comply with the orders of the headquarters, Chinese companies will face the responsibility for breach of contract to customers." Felix said.
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sea and air transportation is also affected
As Felipe said, under the current war, not only the China Europe train, but also almost all modes of transportation involving the European region will be affected to varying degrees.
"On the one hand, the local transportation and storage of Ukraine, which is the center of the war, have been impacted. On the other hand, due to Russia's ban on flights to many countries in Europe and the United States, the flight area will also be limited. Sea transportation, railway, including some international road transportation, have been relatively more impacted." She said that Ukraine's maritime ports were closed at the beginning of the conflict, ships could not dock, and port goods could not be followed up. It will affect the whole European continent. At present, maritime transport is the most affected by the war.
The listed company Shandong Yuma Sun-Shading Technology Corp.Ltd(300993) which mainly produces functional sunshade materials said in the latest research that among the company's export products, the products exported to Russia and Ukraine account for less than 5%, of which the products exported to Ukraine account for less than 1%. At present, the war has affected maritime logistics, and the shipment of the above and surrounding countries has slowed down, which has a slight impact on the company's export sales. In terms of export, affected by the war between Russia and Ukraine, the company's delivery speed to the above and surrounding countries slowed down in March this year, and will return to normal after the overseas war is reconciled.
However, Bai Ming said that compared with the China EU train, the traditional route of China EU maritime transportation is through the Strait of Malacca, the Red Sea, the Mediterranean and the Suez Canal to Europe, and does not pass through the conflict area, so it is not affected by the Russian Ukrainian conflict.
The China export container freight rate composite index (CCFI) shows that the price of China EU routes has not significantly promoted the shipping price. In the latest issue (March 18), CCFI reached 330110 points, down 1.9% from the previous week. Among them, European routes (- 1.9%), American Western routes (- 3.8%), Southeast Asian routes (- 3.8%) and other popular routes fell.
"There are many factors affecting the freight rate, not a single driving factor. The transport capacity of the European line has increased a lot, but the conflict between Russia and Ukraine has affected some traffic volume, so the price has become loose."
In addition, the current price of the US west route with "sky high" Freight last year has fallen. The reporter learned from a number of cross-border trade shippers that the price of the route from China to the west of the United States has dropped from about 13000 US dollars before the Spring Festival to 8000 or 9000 US dollars. "Last year's rise in shipping prices made our price tolerance relatively fragile. In the case of less urgent shipment, our shipment volume decreased significantly, and the freight rate decreased accordingly," said an American business owner who imported furniture from China.
In terms of air traffic, after the escalation of the conflict between Russia and Ukraine, North America, European countries and Russia "banned flights" from each other, and a large number of airlines flew in detours. In addition, some airlines have significantly reduced routes between Asia and Europe.
According to media reports, including cargo aircraft, about 300 flights between Japan and Europe are cancelled or around other routes every week, and the freight rate of this segment has reached about twice that before the conflict between Russia and Ukraine.
At the same time, the conflict between Russia and Ukraine has promoted the sharp rise of international oil prices, causing airlines to urgently levy fuel surcharges. The Asia Pacific Aviation Association recently said that at the time of the sharp rise in fuel prices, flying around Russia will prolong the flight time of many routes outside Asia, which will increase difficulties for airlines already in financial difficulties.
Bai Ming believes that in terms of air transportation, air routes through Russia and Ukraine may be affected, so choosing these air routes may be bypassed. As for other air routes that do not pass through this area, the impact will be very limited.
Some aviation experts also told reporters that at present, the route of Air China to Europe is not affected, but the price of air cargo has risen sharply due to factors such as China's epidemic and rising oil prices.
Recently, Hainan Airlines Holding Co.Ltd(600221) said on the interactive platform that the conflict between Russia and Ukraine had a great impact on global air traffic. First of all, the conflict between Russia and Ukraine has led to a surge in crude oil prices, a significant increase in the operating costs of China's international flights and an increase in the operating pressure of airlines; Secondly, the flight around China and Europe has led to longer routes and increased costs, and the recovery and operation of the China EU market are also facing challenges; Third, it will affect the overall recovery process of the international market. The conflict between Russia and Ukraine will affect the travel confidence of international passengers, and the recovery progress of China EU air transport market is lower. The company said that at present, the proportion of international passenger transport of enterprises is relatively low, the conflict between Russia and Ukraine has little impact on the company's operation, and the production and operation are carried out normally.
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transportation industry is still optimistic in the long term
Just recently, China international shipping network, international freight forwarding branch of China Federation of logistics and procurement and wiffa international freight forwarding credit cooperation platform jointly launched a questionnaire, with more than 1500 freight forwarders participating. The survey results show that "compared with the same period in 2021, the impact of the conflict between Russia and Ukraine on your company's business volume (including railway, sea, air and highway)", 32.35% of the respondents said that the business decreased by more than 50% year-on-year. 20.59% chose "business decreased by 30% - 50% year-on-year", 26.47% said "business decreased by 10% - 30% year-on-year", and 29.41% said "business decreased by 0-10% year-on-year".
With regard to the increase in freight rates, routes, port hopping, demurrage, finance and other costs (including railways, sea transportation, air transportation and roads) after the Russian Ukrainian conflict, 52.94% of the respondents chose the cost increase of 0 ~ 50% before and after the conflict, 29.41% said the cost increased by about 50%, and 23.53% said the cost increased by more than 100%.
At present, 44.12% of the respondents chose "complete stop" and 41.18% chose "partial stop" in terms of trade progress with Russia, and only 23.53% of the respondents said to continue.
does this mean that geographical disputes will impact the foreign trade market and affect the long-term development of transnational transportation industry
In the interview, many people in the industry believed that under the current geographical conflict, although the China EU train is still in normal operation as a whole, it is more difficult to organize the source of goods. However, this abnormal situation will be a short-term situation, and the long-term market prospect is still optimistic.
"Although the war brings risks to the development of China EU trains, it also brings opportunities." Liaoning Port Co.Ltd(601880) the above person in charge said that it is mainly reflected in the increase of Sino Russian trade and the increasing demand for transit through China after Russia is subject to layoffs. Dalian port will take advantage of the advantages of ocean routes to develop the transit of goods from Japan, South Korea and Southeast Asia to Russia, so as to provide customers with freight RMB settlement services and stabilize market confidence.
Felipe believes that after the conflict eases, different modes of transportation will be affected for different durations. If there is relatively little damage to the aviation and train infrastructure in Central Europe, it can be restored relatively quickly. In addition, if you only pass through the conflict area, the recovery is relatively fast, but if the destination is the conflict area, the infrastructure recovery will take time.
Zhao Xiaomin also believes that with the easing of the war situation, the market will gradually return to normal.
"In the long run, it has no impact. The operation of China Europe train is now very mature and the mode is becoming more and more scientific." He said that in the past, China Europe trains did have some problems of resource allocation and resource overlap, but according to the performance from last year to this year, especially since 2021, many train route design and resource coordination have become more and more mature. For example, the situation of "return empty box" in the past has been greatly reduced, and the medium and long-term carrying capacity and profitability of the route are still optimistic.
He further explained that the current transport capacity pressure is mainly transferred to sea transportation, and the sea transportation price has fluctuated recently. The air transportation is still greatly affected by the epidemic. For the whole trade circulation, the price fluctuation is still very large. It is hoped that import and export trade enterprises will make a variety of emergency plans and sign long-term agreements as far as possible to avoid more price risks and legal risks.
[reporter's observation] trade enterprises should think of Countermeasures in advance
Geopolitical risks continue. How should trade and logistics providers involved in relevant regions deal with them?
"For the goods that have been delivered, we should actively take measures to transship and change the destination to minimize the loss. For the goods that have not been delivered, it is recommended not to deliver them for the time being. When the destination is unknown, the back-end can not handle it. If the goods are delivered, it will cause a series of troubles. It is best to negotiate in advance not to deliver them for the time being, or choose a relatively safe and secure method." Fei Lili, a lawyer from Shanghai siweilema law firm, suggested that because the current armed conflict only occurs in Ukraine, ports in Ukraine are closed, flights are cancelled and inland transportation is suspended. Therefore, for the accepted consigned goods whose final destination is Ukraine, if they cannot be transported to the destination, the shipper shall be notified in writing of the circumstances and reasons leading to the transportation interruption at the first time. It is better to attach the written notice of the shipping company, airline, railway company or transportation company, and make it clear that this is a case of force majeure, and the carrier shall be exempted according to the law. At the same time, the opinions of the shipper on the return or transshipment of the goods shall be solicited.
She said that according to the provisions of China's maritime law, if the ship cannot unload at the port of destination agreed in the contract due to force majeure, unless otherwise agreed in the contract, the master has the right to unload the goods at a safe port or place adjacent to the port of destination, which is deemed to have fulfilled the contract. For such goods in transit, the freight forwarder should pay more attention, pay close attention to the trend of the goods, and timely communicate and inform the actual carrier and the client. It is strongly recommended to pay attention to timeliness. In addition, China's maritime law gives both parties the right to terminate the contract for seaborne goods that have been loaded but not yet shipped. Unless otherwise agreed in the contract, if the freight has been paid, the carrier shall return the freight to the shipper; If the goods have been loaded on board, the shipper shall bear the loading and unloading expenses; If a bill of lading has been issued, the shipper shall return the bill of lading to the carrier.
For the goods destined for Russia or other relevant regions that cannot be transported due to various reasons, Fei Lili suggested that special care should be taken to apply the exemption of force majeure.
She said that for the goods destined for Russia and other affected areas, it is more likely that the goods cannot be transported to Russia due to the sanctions and embargoes of European and American countries.
For Chinese freight forwarders, because the Chinese government has not taken any sanctions against Russia and has not issued any prohibitions, freight forwarders cannot claim Force Majeure for exemption.
For the subsidiaries of foreign freight forwarders headquartered in European and American countries in China and Chinese freight forwarders cooperating with destination agents in European and American countries, the possible situation is that the headquarters or local agents need to comply with the sanctions or embargoes of their own governments and suspend the transportation to Russia. In this case, if the shipper investigates the liability for breach of contract of the Chinese freight forwarder for failing to deliver the goods as agreed, the Chinese freight forwarder cannot claim force majeure to avoid liability. Chinese freight forwarders should actively use Chinese law to safeguard their legitimate rights and interests and properly negotiate with relevant parties. When necessary, they can also protect their own rights and interests in accordance with the relevant provisions of the measures for blocking the improper extraterritorial application of foreign laws and measures promulgated by the Ministry of Commerce of the people's Republic of China.
Bai Ming also reminded that the top priority of Chinese freight enterprises at this stage is to do a good job in risk assessment, consider more risk factors, and keep up with the corresponding insurance when carrying out relevant business as much as possible. At the same time, we must make a plan and prepare more options.
"For example, the China Europe train itself has different routes and shifts. If route a is risky, after comprehensively measuring the cost, convenience, feasibility and other factors, can we consider replacing it with route B or route C." He said.
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