China-Europe trains help stabilize trade amid pressure on Shanghai port

Aerial photo taken on April 23, 2017 shows a container dock at Yangshan Port in east China's Shanghai.  Yangshan Port is China's first port built on islands.  Shanghai, one of the most important cities in eastern China, has container trade with more than 500 ports from 214 countries and regions.  In 2016, the Port of Shanghai maintained its position as the world's leading container throughput for seven consecutive years.  (Xinhua/Ding Ting)

Aerial photo taken on April 23, 2017 shows a container dock at Yangshan Port in east China’s Shanghai. Yangshan Port is China’s first port built on islands. Shanghai, one of the most important cities in eastern China, has container trade with more than 500 ports from 214 countries and regions. In 2016, the Port of Shanghai maintained its position as the world’s leading container throughput for seven consecutive years. (Xinhua/Ding Ting)

Chinese producers and exporters are diversifying China-Europe trade routes by redirecting some orders from ships to trains and planes to cope with the disruptions and uncertainties posed by the COVID-19 outbreak in Shanghai and some neighboring parts of the world. Yangtze River delta, an important center of production and trade.

The change came as the port of Shanghai, the world’s largest port by container traffic, faces growing container stocks. Some major international shipping companies suspend the delivery of goods to the port, which poses serious problems for the timely delivery of goods.

Some 60% of cargo at Shanghai Port is ‘unclaimed’ due to logistical disruptions on the roads and at sea, as the port has reached its limit and can hardly accommodate more containers, insiders have said. industry. The pressure has reverberated on the neighboring port of Ningbo Zhoushan, in Zhejiang province (east China).

Faced with continued uncertainties regarding maritime transport, some producers and exporters engaged in China-Europe trade are seeking to diversify their trade routes from ships to trains and planes.

A trader based in Yiwu, a major small-commodity trading hub in Zhejiang, told the Global Times on Sunday that he had received more inquiries from customers regarding the diversion of sea shipments to China-China freight trains. Europe.

“Trains take much less time and they are more punctual, which is important, especially for the most urgent or high-value goods,” the person said.

What normally takes about 35 days by sea from Yiwu to German cities only takes about 18 to 20 days by train, the trader said, indicating a clear competitive advantage for rail service in avoiding disruptions.

In the first quarter, 370 China-Europe freight trains were dispatched from Yiwu, a 10.1 percent year-on-year increase, a trend industry insiders said will continue to ease pressures at seaports. .

A factory manager in Yiwu told the Global Times on Sunday that the train is punctual, although it may cost more than sea freight and the transportation capacity is much lower. Airplanes are also among his concerns at the moment.

The European Union Chamber of Commerce in China noted that its member companies have estimated a 40 percent decline in daily cargo volume handled at the Port of Shanghai, according to media reports.

Wu Minghua, an independent industry analyst, told the Global Times that the main cause of the disruptions in ocean freight is actually on land, as truckers still find it difficult to enter and leave the port due to epidemic controls. .

While cross-border freight trains can be an option in tough times, shipping will remain the main mode of transport for international trade, industry experts said. A train can usually carry 50 standard containers, while a large ship can carry around 20,000.

Moreover, it is not always possible to change shipments from ships to trains for various reasons, Tommy Tan, president of Shanghai EPU Supply Chain Management Co, an agent for China-EU freight trains, told the Global Times. Customers often prefer to choose another port instead, Tan said.

Some small and medium traders are turning to the port of Ningbo Zhoushan, which is also under increasing pressure. To facilitate operations, the Port of Shanghai has sought to enhance the use of inland waterways and railways to ease transportation congestion.

The situation calmed down after the State Council, China’s cabinet, urged local governments not to close highways without permission.

The pressure on Shanghai’s port is temporary and will dissipate when road transport returns to normal, experts said. Until then, cross-border freight trains will play an important role.

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