RE: Pressure on air cargo rates from China keeps increasing Some shippers turn to trans-Eurasia rail to9 Aug 2020 15:10
"The San Francisco-based company also reported that Taiwanese carriers, such as EVA Air Cargo, have announced a 20 to 25% rate increase effective Aug. 12. “It is anticipated that this is the first of many rate increases to come over the next few months,” it said
Trans-continental rail
The premium pricing and congestion at major hub airports is leading more shippers to consider rail from China to Europe as a less expensive alternative to air for a range of goods, including clothing, paper, consumer goods, electronics, and industrial components.
Rail transport is up to 50% faster than sea freight and up to 60% cheaper than airfreight, according to European logistics specialists.
Railroads have developed several routes over the past dozen years. Initially, logistics companies needed to book an entire block train, but now can offer less-than-container and container-load options.
The railroad joint venture that operates a line through Belarus, Kazakhstan and and Russia said July container volume of 54,200 TEU was 76% more than a year ago and set a record. China shipments to Europe doubled and loaded containers from Europe grew by 80%. For the first seven months of the year, traffic is up 267%.
Transit times average about 15 days, depending on the origin and destination points.
Earlier this year CEVA Logistics launched an intermodal product that trucks shipments from China to Vietnam and loads them into high-cube containers for rail transport to Europe.
Cargo.partner, an Austrian forwarder, recently introduced two new weekly LCL direct connections between Duisburg, Germany, and Hefei, China, as well as between Linz, Austria, and Xi’an. The company says it expects demand to increase in both directions.
Freight forwarder Davies Turner has responded to increased bookings on its weekly fixed rail service from China to Dartford, U.K. by adding direct service to Birmingham, Bristol and Manchester.
The weekly service departs the rail hub in Hefei and goes to Neuss, Germany. Containers are then trucked under bond to the Port of Rotterdam and transported by ferry to East London.
DSV Panalpina, which offers a rail service, also says its road transport service from eastern China to western Europe has gained popularity during the COVID-19 crisis.
Passenger network uncertainty
The wild card for cargo rates is the extent to which airlines resume passenger service. Although there have been blips of increased travel activity this summer, airline executives are more cautious about adding costly flights when the coronavirus is spiking in parts of the world.
U.S. passenger throughput, as measured by the Transportation Security Administration at airport checkpoints, increased last week for the first time in a month. For the week ending Thursday, the passenger level was 71.9% off of the same period in 2019, but airline ticketing numbers declined 0.4 points from the prior week."
More in article, including charts.
Sign In
Follow the stocks
