The shipping fee to HAM in Germany used to be US$850 for a small container, but now it is US$1,700-1,800, which has more than doubled. This is not even a big increase. For example, the price of a small cabinet in Vietnam has increased from more than 200 US dollars to more than 700 US dollars, and the price has tripled…
Recently, a friend who is engaged in foreign trade cried to the editor.
Recently, the market has been flooded with news about port congestion and paralysis in many countries, skyrocketing freight rates, and importers abandoning goods. Many foreign trade bosses said: The market is cold, but freight rates are extremely hot. It is a world of ice and fire, and it is too difficult to do business. Got it!
The difficulties faced by foreign trade bosses also attracted the attention of CCTV Finance. CCTV 2’s “Online Finance” column also made relevant reports on international air cargo:
Entering October, air cargo has ushered in the traditional peak season. Not only has cargo volume increased significantly, but warehouses have been liquidated and queues have appeared. Air freight prices on some routes have also increased or even doubled.
Now is the traditional peak season for air freight, and the amount of warehousing is very large. Traffic jams and queues are very serious in the unloading area of a logistics warehousing area near Shanghai Pudong International Airport. There are also many trucks queuing up on the road outside the park, waiting to enter the park.
Not only has cargo volume increased significantly recently, but freight prices on major routes have also increased a lot.
Jiang Zhihao, manager of Shanghai Tenglong International Freight Line:
For example, the Southeast Asia route has risen from about 10 yuan/kg in early September to 18 yuan-20 yuan/kg. European routes have also entered the traditional peak season, with prices rising from 30 yuan/kg to 50 yuan/kg, with some extreme cases reaching 60 yuan/kg.
A salesperson in foreign trade said: “Recently, freight rates have increased a lot. We have already received deposits for some of the orders we received before, and they will be loaded into containers at the end of the month. They were originally received at low prices. With such an increase in freight costs, our profits have almost been reduced.” It’s all going to be wiped out!”
What makes me tired is not only the increase in shipping costs, but also…
The recent increase in freight rates and the shortage of containers are tiring things for textile foreign trade people, but there is also the most tiring thing – lack of orders.
“The market has been very weak recently. After a wave of orders in October, we have not received any new orders recently.” said Mr. Meng, a textile boss who makes knitted fabrics.
Entering November, with the second outbreak of overseas epidemics, news of country closures and Christmas markets being closed again came out in many countries, which had a relatively large impact on the textile market, an industry with a high proportion of exports. After intensive replenishment during the Christmas season in October, foreign trade orders have shrunk significantly.
“Many foreigners now have low expectations for Christmas season consumption, so they have not made much efforts to prepare and replenish goods. Our factory’s orders will end in mid-December, and we are about to enter a more difficult period.” In addition, Said Mr. Qian, who has been engaged in textile foreign trade for more than ten years.
Another textile boss who specializes in nylon spinning and recycled fabrics said: “Recently, only one-third of the looms in the factory have been operated. We supply a foreign fast fashion brand, but their orders have shrunk significantly this year. We haven’t had any orders to go out recently, so we don’t have to worry about rising shipping costs. But the profit from taking orders this year is really thin.”
In addition to the reduction in terminal demand due to the epidemic, the rapid appreciation of the RMB has also affected the placement of orders in the market. It is reported that the person in charge of a company in Guangdong that mainly produces tablecloths and other home textile products said that the RMB exchange rate has a greater impact on the company. The main business is rising prices, reduced orders, and reduced profits for the company. Due to the sudden appreciation of the RMB, small and medium-sized enterprises can only absorb these exchange rate differences on their own.
“The worst thing now is that the dollar has fallen, which has wiped out our profits.” said Mr. Wang, a foreign trade boss.
Now the RMB has entered the era of 6.5. Compared with the RMB exchange rate of more than 7 points against the US dollar at the end of May, the appreciation rate has exceeded 8%. The profit of general foreign trade orders is 10-15%. The increase in shipping costs and the appreciation of the RMB have almost offset it. made most of the profits.
In addition, according to the practice in previous years, many textile bosses will choose to settle the payment in foreign exchange before the Chinese New Year to pay for goods, employee bonuses and other expenses. However, judging from the current trend, the probability of RMB appreciation in the medium and long term is relatively high.
Liu Jie, head of China macro strategy at Standard Chartered Bank (Hong Kong) Co., Ltd., believes that based on strong fundamentals and a reduction in risk premiums, the RMB exchange rate against the US dollar is predicted to appreciate to 6.30 in mid-2021.
If the RMB enters the 6.3 era, it will be another huge loss for textile bosses who have not yet settled foreign exchange. In the words of a textile boss: The exchange rate at the beginning of the year was 7.1, and now it is 6.5. Foreign trade companies have worked hard for a year, but their work has been in vain.�� This is a greater impact than the epidemic has had on us.
Textile foreign trade bosses have experienced too much in 2020: they lost orders due to the epidemic in the first half of the year, and lost profits due to exchange rates and freight in the second half of the year. Fortunately, next year’s foreign trade market will gradually develop for the better, boosted by vaccines and RCEP, and the foreign trade market will finally usher in the “dawn”!
</p
