On September 27, the China-Europe Express “Global Yida” full of 100 TEUs of export goods made its debut in Yiwu, Zhejiang, and rushed to Madrid, the capital of Spain, 13,052 kilometers away. One day later, the China-Europe Express was fully loaded with 50 containers of cargo. The “Shanghai” sailed from Minhang to Hamburg, Germany, which is thousands of miles away, marking the successful launch of the Shanghai-German China-Europe Express.
The intensive starter made the China-Europe Express train never stop during the National Day holiday. The train inspectors ushered in a doubling of the workload of “In the past, each person inspected more than 300 vehicles per night, but now inspects more than 700 vehicles per night.” At the same time, the number of trains opened in the context of the global epidemic hit a record high in the same period.
Official data show that from January to August this year, China-Europe freight trains opened a total of 10,052 trains, which exceeded 10,000 trains two months earlier than last year, transporting 967,000 TEUs, up 32% and 40% year-on-year, respectively, and the overall heavy container rate was 97.9%.
In the context of the current “hard to find one box” in international shipping and the sharp increase in freight rates, China-Europe Express has provided foreign trade companies with more choices. But at the same time, the rapidly expanding China-Europe Express is also facing many bottlenecks.
China-Europe Express Express ran out of “acceleration” under the epidemic
Chengyu area is the first city in the country to open a China-Europe train. According to data from the Chengdu International Railway Port Investment Development Group, from January to August this year, nearly 3,600 trains of China-Europe Express (Chengyu) were launched. Among them, Chengdu is steadily strengthening the three main lines of Lodz, Nuremberg and Tilburg, innovating the “European” operation model, and basically achieving full coverage of Europe.
In 2011, Chongqing opened the Hewlett-Packard train, and then many cities across the country have successively opened freight trains to Europe. As of August 2018, the cumulative number of China-Europe Express Trains nationwide has achieved the annual target of 5,000 trains set out in the China-Europe Express Train Construction and Development Plan (2016-2020) (hereinafter referred to as the “Plan”).
The rapid development of the China-Europe Express during this period benefited from the “Belt and Road” initiative and the inland areas actively seeking to establish a major international logistics channel connecting the outside world. In the eight years from 2011 to 2018, the annual growth rate of China-Europe Express trains exceeded 100%. The most jumped one was in 2014, with a growth rate of 285%.
The outbreak of the new crown pneumonia epidemic in 2020 will have a relatively large impact on air and maritime transport, and due to the interruption of airports and port closures, China-Europe Express has become an important support for the international supply chain, and the number of opening cities and openings has increased significantly.
According to data from China Railway Group, in 2020, a total of 12,400 China-Europe freight trains will be opened, and the annual number of trains will exceed 10,000 for the first time, a year-on-year increase of 50%; a total of 1.135 million TEUs of goods have been transported, a year-on-year increase of 56%, and the comprehensive heavy container rate will reach 98.4 %.
With the gradual resumption of work and production around the world, especially since the beginning of this year, the demand for international transportation has greatly increased, the port is congested, and one box is hard to find, and the shipping price has also risen sharply.
As a long-term observer in the field of international shipping, Chen Yang, editor-in-chief of Xinde Maritime Network, a professional shipping information consulting platform, told CBN that since the second half of 2020, the tension in the container supply chain has not improved significantly, and the freight rate this year is even more frequent. Set a record high. Even if it fluctuates, the freight rate from Asia to the US West is still more than ten times higher than before the epidemic. It is conservatively estimated that this situation will continue until 2022, and some analysts even believe that it will continue until 2023. “The industry consensus is that the bottleneck of container supply is definitely hopeless this year.”
China Securities Investment also believes that the super peak season for consolidation may be extended to a record. Under the influence of various incidents of the epidemic, the chaos in the global supply chain has intensified, and there is still no sign of improvement in the relationship between supply and demand. Although new small carriers continue to join the Pacific market, the overall effective capacity of the market remains at around 550,000 TEUs per week, which has no obvious effect on improving the relationship between supply and demand. During the epidemic, the port’s management and control of calling ships has been upgraded, which has exacerbated schedule delays and the contradiction between supply and demand. The unilateral market pattern caused by the severe imbalance between supply and demand may continue for a long time.
Corresponding to the continued strong market demand is the “acceleration” of China-Europe Express trains running out of the epidemic. Official data show that since this year, the China-Europe Express trains entering and leaving the country through the Manzhouli Railway Port have exceeded the 3,000 mark. Compared with last year, the 3,000 trains have been completed nearly two months earlier, showing a sustained and rapid growth trend.
According to the China-Europe Railway Express Data Report issued by the State Railway Administration, in the first half of this year, the capacity of the three major corridors was further improved. Among them, the Western Corridor opened 3,810 rows, an increase of 51% year-on-year; the Eastern Corridor opened 2,282 rows, an increase of 41% year-on-year; The channel opened 1285 columns, a year-on-year increase of 27%.
Under the tension of international shipping and the rapid increase in freight rates, China-Europe Express has provided supplementary programs for foreign trade companies.
Chen Zheng, general manager of Shanghai Xinlianfang Import and Export Co., Ltd., told China Business News that the transportation time of the China-Europe Express has now been compressed to about 2 weeks. The specific freight amount varies depending on the agent, and the 40-foot container freight quote is currently About 11,000 U.S. dollars, the current shipping container freight has risen to nearly 20,000 U.S. dollars, so if companies use the China-Europe Express, they can save costs to a certain extent, and at the same time, the transportation timeliness is not bad.
From August to September this year, a large number of Christmas items could not be shipped out in time due to “a box of hard to find”. Qiu Xuemei, general manager of sales of Dongyang Weijule Arts & Crafts Co., Ltd., once told China Business News that they are considering shipping some goods to Russia or Middle Eastern countries from sea to land transportation for export.
However, the rapid growth of China-Europe Express is still not enough to form an alternative to ocean freight.
Chen Zheng said that the international cargo transportation is still mainly based on sea transportation, accounting for about 80%, and air transportation accounting for 10% to 20%. The proportion and volume of China-Europe express trains are relatively limited, and supplementary solutions can be provided, but It is not a substitute for sea or air transportation. Therefore, the symbolic significance of the opening of the China-Europe Express Train is greater.
According to data from the Ministry of Transport, in 2020, the container throughput of coastal ports will be 230 million TEUs, while the China-Europe Express trains will carry 1.135 million TEUs. From January to August this year, the container throughput of coastal ports across the country was 160 million TEUs, while the total number of containers sent by China-Europe trains in the same period was only 964,000 TEUs.
Yang Jie, commissioner of the International Express Service Center of the China Communications and Transportation Association, also believes that although China-Europe Express can replace only a handful of goods, the role of China-Europe Express will undoubtedly be further strengthened.
China-Europe trade warming boosts the popularity of China-Europe Express
In fact, the current popularity of China-Europe Express is not a temporary situation, and the reason behind it is not only because of the skyrocketing ocean freight.
“The advantages of China’s dual-cycle structure are first reflected in its economic and trade relations with the European Union.” Wei Jianguo, former vice minister of the Ministry of Commerce and vice chairman of the China Center for International Economic Exchange, said that from the perspective of economic relations, this year 1~ In August, China-EU trade was 528.9 billion U.S. dollars, an increase of 32.4%, of which my country’s exports were 322.55 billion U.S. dollars, an increase of 32.4%, and my country’s imports were 206.35 billion U.S. dollars, an increase of 32.3%.
Wei Jianguo believes that this year the EU will very likely surpass ASEAN again and return to China’s largest trading partner status. This also means that China and the EU will become each other’s largest trading partners, and “China-EU economic and trade relations will usher in a bright future.”
Although the China-Europe freight train currently carries a relatively limited proportion of China-Europe economic and trade, he predicts that China-EU trade will exceed 700 billion U.S. dollars, and with the rapid increase of China-Europe freight trains, it will be possible to carry 40-50 billion U.S. dollars in international transportation of goods. The potential is huge.
It is worth mentioning that many countries are paying more attention to the China-Europe Express to improve the efficiency of customs clearance. “The ports of China-Europe Express are better than those of the United States and ASEAN in terms of decongestion and container handling. This allows China-Europe Express to play a role as a commando in Sino-European trade.” Wei Jianguo said, “Although it is still not enough. The main force, but played a very good role as an outpost.”
also have a great feeling about this company. Alice, the shipping manager of Youhe (Yiwu) Trading Co., Ltd., told CBN that a company that originally exported to the United States has also increased its export volume to the European market this year, with an increase of about 50% to Europe. This has further increased their attention to the China-Europe Railway Express.
From the perspective of the types of transported goods, China-Europe Express has expanded from the initial laptop and other electronic products to more than 50,000 product types such as auto parts and vehicles, chemicals, machinery and equipment, e-commerce parcels, and medical equipment. The annual freight value of freight trains increased from 8 billion U.S. dollars in 2016 to nearly 56 billion U.S. dollars in 2020, an increase of nearly 7 times.
The “empty container” situation of China-Europe Express trains is also improving: in the first half of 2021, the return trip ratio reached 85%, the best level in history.
The China-Europe Express “Shanghai”, which was launched on September 28, will give full play to the role of return trains in stimulating imports. In mid-October, the China-Europe Express “Shanghai” will return to Shanghai from Europe. Exhibits such as audio, large-scale sanitation vehicle locator, and nuclear magnetic resonance equipment will enter the country by train to participate in the 4th CIIE. Next, it will also take advantage of transportation efficiency to introduce more high-value commodities such as wine, luxury goods, and high-end instruments to the Chinese market by means of cross-border railways.
As one of the platform companies with the most complete lines, the most ports, and the most accurate plans to fulfill the domestic China-Europe freight train operation platform, Yixinou is the only privately-owned holding company in the industry with a market share of 12% of the total shipments in the country. It is also this year Gained a surge in return trains and cargo values.
From January 1 to October 1, 2021, the China-Europe (Yixin Europe) Express Yiwu platform has launched a total of 1,004 trains, and a total of 82,800 TEUs were shipped, a year-on-year increase of 57.7%. Among them, a total of 770 outbound trains were shipped, a year-on-year increase of 23.8%, and a total of 234 trains were shipped, a year-on-year increase of 1413.9%.
According to the statistics of Yiwu Customs, from January to August this year, Yiwu Customs supervised and passed the “Yixin Europe” China-Europe Express train import and export value of 21.41 billion yuan, a year-on-year increase of 82.2%, of which exports were 17.41 billion yuan, a year-on-year increase of 50.6%, and imports were 4.0 billion yuan. Yuan, a year-on-year increase of 1955.8%.
On August 19, the 3,000th train of the “Yixinou” train on the Yiwu platform departed. The platform operator Yiwu Tianmeng Industrial Investment Co., Ltd. issued a railway multimodal transport bill of lading, endorsing the “railway multimodal transport bill of lading materialization”. Trading companies use the bill of lading as evidence to obtain a “freight loan” or “cargo loan” from the bank. “Loan credit. This is a historic breakthrough in the business innovation of “railway multimodal transport bill of lading materialization”, marking the official landing of the China-Europe Express “railway multimodal transport bill of lading materialization” bill of lading issuance and bank credit business.
Wang Jinqiu, chairman of Shanghai Oriental Silk Road Intermodal Transport Co., Ltd., said that the China-Europe Express “Shanghai” has no government subsidies and is entirely carried by market-operated platform companies. With the gradual decline of subsidies for China-Europe Express trains, Shanghai will also explore a new path.
Infrastructure has become a key bottleneck
Although the China-Europe Express Express is showing explosive growth, it still faces many problems.
Congestion not only occurs in coastal ports, but a large number of China-Europe freight trains gather, which puts tremendous pressure on railway stations, especially railway ports.
The China-Europe train is divided into three passages: West, Central, and East, passing through Alashankou and Horgos in Xinjiang, Erlianhot in Inner Mongolia, and Manzhouli in Heilongjiang. Moreover, due to the inconsistency of rail standards between China and the CIS countries, these trains need to pass through here to change their tracks.
In 1937, the International Railway Association made a regulation: a gauge of 1435 mm is a standard gauge, a gauge of 1520 mm or more is a wide gauge, and a gauge of 1067 mm or less is counted as a narrow gauge. Most countries in the world, such as China and Western Europe, use standard gauges, but Kazakhstan, Kyrgyzstan, Uzbekistan, Tajikistan, Russia and other CIS countries use wide gauges. As a result, trains running on the “Pan-Eurasian Railway Main Line” cannot become “Eurasian through trains.”
A related person from a train company introduced that due to port congestion, in July and August this year, the National Railway Group reduced the number of China-Europe trains operated by various train companies.
Due to congestion, the timeliness of the China-Europe Express is also restricted. A person in charge of the logistics department of an enterprise told CBN that the company had previously imported some parts and accessories from Europe through the China-Europe Express, but due to the higher timeliness requirements now, the China-Europe Express could not meet the requirements and transferred this part of the goods to air import. .
Wang Guowen, director of the Institute of Logistics and Supply Chain Management of China (Shenzhen) Comprehensive Development Research Institute, told CBN that the current bottleneck lies in infrastructure. As far as China is concerned, it is okay to open 100,000 trains a year. The problem is to change the track. From China to Russia, the standard track must be changed to a wide track, and from Russia to Europe, it must be changed from a wide track to a standard track. Two track changes formed a huge bottleneck. This involves the settlement of rail-changing facilities and station facilities.
A senior industry researcher said that the lack of China-Europe Express’s infrastructure, especially the national railway infrastructure along the line, has caused a shortage of China-Europe Express’s transportation capacity.
The “Planning” also proposes to actively promote the joint development of the Eurasian railway plan with countries along the China-Europe railway line, and to steadily promote the construction of overseas railways. Accelerate the advancement of preliminary studies on China-Kyrgyzstan-Ukraine and China-Pakistan railway projects. The Mongolian and Russian railways are welcome to upgrade and renovate outdated lines, improve the station layout and supporting facilities and equipment of border stations and reloading stations along the line, and promote the matching and connection of the point-line capabilities of the China-Russia-Mongolia railway.
However, it is difficult to compare foreign infrastructure construction capabilities with China. Therefore, Wang Guowen proposed that the solution is to strive for all ports to bring in the tracks and change tracks within China. With China’s infrastructure construction capabilities, the ability to change tracks can be greatly improved.
At the same time, Wang Guowen also suggested that the original railway infrastructure in the domestic section should be strengthened, such as the reconstruction of bridges and tunnels, and the introduction of double-deck containers. “In recent years, we have paid more attention to passenger transportation, but the freight infrastructure has not been greatly improved. Therefore, through the renovation of bridges and tunnels, the transportation volume has been increased, and the economic reliability of the train operation has been improved.”
The official source of the National Railway Group also stated that since this year, the implementation of the Alashankou, Horgos, Erenhot, Manzhouli and other port expansion and transformation projects has effectively improved the inbound and outbound passage capacity of China-Europe Express. From January to August this year, 5125, 1766, and 3139 trains were opened in the West, Central, and Eastern Corridor of China-Europe Railway, representing a year-on-year increase of 37%, 15%, and 35% respectively.
In addition, the seventh meeting of the China-Europe Railway Freight Transport Joint Working Group was held on September 9 by video conference. The meeting reviewed the “China-Europe Express Train Schedule Preparation and Cooperation Measures (Trial)” and the “China-Europe Express Train Transportation Plan Agreed Measures” drafts. All parties agreed to sign, and further improved the ability of domestic and overseas transportation organization.
(Source: China Business News)
Post time: Oct-21-2021