Prices have increased again! Prices of ocean and air freight to the US have both increased significantly

Cross-border logistics prices are rising, and sellers are suffering!

Since last year, cross-border logistics prices have been on the rise, with sea and air freight falling one after another. The trend has not stopped to this day, but has become increasingly fierce. In this wave of continuous price increases, sellers generally reflect that freight is much higher than the value of the goods. Even so, due to the lack of transportation capacity, the delivery time is so slow that people are questioning their lives.

Prices have increased again! Prices of ocean and air freight to the US have both increased significantly

With the peak season approaching, the already high logistics prices have risen to new heights. Ocean shipping, which has attracted much attention from cross-border people, has even started a series of skyrocketing prices:

Sadly, the freight forwarder said that sea freight prices will increase significantly starting next week.

The freight is already so expensive, how much more will it increase? Will we be able to survive?

The price of ocean freight changes every day, and it’s skyrocketing!

Foreign customers wanted to wait until the freight rates dropped before placing orders, so they waited from the first half of the year to the second half of the year, but the freight rates continued to rise.

When I first started doing C-end business, the sea freight was six or seven yuan per kilogram. Now it has risen to almost 30 yuan per kilogram, making it really difficult to export.

I gave a quote to a customer today , and he said he was scared to death by the high shipping costs .

The price of sea freight has been rising, and the price of air freight is also rising.

Weibo blogger "Dedicated Logistics Person" said that the air freight price in the entire Americas is more than 20 yuan/KG more expensive than the express price, and the United States is even more exaggerated, with air freight being 30 yuan/KG more expensive than express delivery. The flight suspension at Shanghai Airport has put tremendous pressure on the flight capacity from HK to the United States. Although there is not as much cargo as in the same period last year, the number of flights has dropped sharply, and cargo has piled up like a mountain, with a minimum of 7 days to wait for cargo. This time is a bit long, and it has dealt a heavy blow to the entire economic chain.

It is reported that at the end of August 2021, the air freight self-pickup quotation from HKCX to Miami, USA was more than 70 yuan/KG, and the price on September 9 was 110HKD/KG. Even if the goods are in the airport warehouse before the plane takes off, the price will still increase . In the past, the price could be locked as soon as the goods entered the warehouse, but this practice is no longer used.

"This is a completely abnormal phenomenon. I don't know when things will return to normal," said Weibo blogger "Dedicated Logistics Man", adding that the high logistics prices have dealt a heavy blow to small and medium-sized foreign trade companies.

In addition, with the peak season approaching, the peak season surcharge has also increased. The peak season surcharges for JH Hong Kong Federation & Mainland Federation & Hong Kong TNT & Mainland TNT US lines have been updated:

1. The peak season surcharge for the United States, Canada, Mexico and Puerto Rico for Hong Kong FedEx FEDU, FEDK and FEDY channels is adjusted from 10.8 RMB/KG+U to 14 RMB/KG+U;

2. The peak season surcharge for the United States, Canada, Mexico and Puerto Rico through the Hong Kong TNTB channel is adjusted from 10.8 RMB/KG+U to 14 RMB/KG+U;

3. The peak season surcharge for the United States, Canada, Mexico and Puerto Rico through the Hong Kong Federal FIPF channel is adjusted from 19RMB/KG+U to 22RMB/KG+U;

4. The peak season surcharge for the Americas and other countries through the FEDL channel of the mainland is adjusted from 7RMB/KG+U to 9.5RMB/KG+U;

5. The peak season surcharge for the Americas and other countries through the TNTG & TNTQ channels in mainland China is adjusted from 14 RMB/KG+U to 19 RMB/KG+U.

The above adjustment will take effect on September 10th. Goods less than 1KG will be charged as 1KG, and other changes remain unchanged.

Shipping costs are higher than costs, sellers complain

Under this wave of unbridled price increases, many cross-border sellers have expressed that they can no longer bear it. Among them, some sellers complained that the shipping costs were far higher than the costs:

When I see the current shipping costs, my head starts buzzing.

My heart bleeds when I see last month's shipping bill.

I just ordered several thousand goods. The procurement cost is actually only 50,000, but the shipping cost has exceeded 50,000 . It’s really expensive to do business on Amazon.

Now many of our peers have reported that freight rates are higher than costs, and European airlines’ are even more terrible.

Many sellers also responded that because the shipping costs were too high and the delivery time was too slow, foreign customers directly said they did not want the goods:

The foreign trade people were in tears. A few days ago, an order was cancelled because of the sea shipping price.

I have many cabinets that are no longer in use due to the skyrocketing freight costs.

My factory is overwhelmed and the products cannot be shipped out due to lack of containers.

After the export freight rates skyrocketed, some large enterprises and shipping companies signed long-term agreements and may have been less affected, but many small and medium-sized sellers suffered, especially some sellers who mainly sold low-value goods. When the shipping costs were much higher than the value of the products, they either struggled to hold on or had to withdraw.

This is not an exaggeration. Originally, cross-border sellers could pass on the logistics costs to consumers, but now Amazon has implemented inventory restrictions, and a large number of sellers are clearing out their warehouses and selling off their goods. Even so, they still can't sell them, not to mention the price increase. In addition, the current logistics prices are not only ridiculously high, but also slow. Some small and medium-sized sellers were too optimistic at the beginning of the year and actively expanded their production capacity. As a result, because the timeliness was too slow, the goods could not be shipped, and the inventory backlog was difficult to collect. Sooner or later, small and medium-sized sellers will be "crushed" by cash flow.

Steven, a European and American FBA first-leg logistics company, said that in the second half of the year, the overall trend is that freight rates will continue to rise, and there will still be uncertainties and various risks. The chaos in the freight market caused by the epidemic will not disappear so quickly. It is uncertain whether the congestion in ports in South China caused by the outbreak of the epidemic in Yantian will rebound. Once it rebounds, delays in shipping will be unavoidable. The second half of each year is a high-incidence period for problems, and it is recommended that everyone make a long-term stocking plan.

Seller: The logistics time is slow and the shipping date is now far away!

How slow is cross-border logistics? Sellers and freight forwarders have the most say.

A freight forwarder said that with the peak season approaching, congestion in various FBA logistics channels has intensified, and European airlines have also slowed down. Needless to say, the long-criticized ocean freight has no shipping date in sight ! Another freight forwarder said that there has been no space for air freight for two consecutive weeks, and he has recently suffered severe hair loss due to his worries.

Sellers are also suffering. One seller said that the express he sent to the UK recently took more than 20 days to arrive, and the express he sent to Eastern European countries was still in transit for a month.

The editor would like to kindly remind all sellers that if you want to restock holiday products, it is best to think twice before doing so. According to the current logistics timeliness, the products may still be floating on the sea after Halloween.

Foreign media reported that many professionals believe that congestion at US ports is expected to continue until mid-2022.

It is reported that with the holiday shopping season approaching, retailers' demand to replenish inventory is currently at an all-time high. Coupled with the shortage of truck drivers and warehouse workers, which is also exacerbating congestion, port congestion is not expected to ease in the next few months.

Concerns about holiday inventory have surfaced as cargo delays and berth wait times persist at the ports of Los Angeles and Long Beach, with Russell Group managing director Suki Basi estimating that up to $90 billion worth of goods could be affected if the congestion continues into October.

Cargo volumes have been growing in recent months. The Port of Long Beach has broken monthly cargo records in 12 of the past 13 months. As of July, the port handled 5.5 million TEUs, up 32% from the same period last year, according to the Port of Long Beach. The Port of Los Angeles handled 6.3 million TEUs in the 2021 calendar year.

In many areas, containers are sitting at ports or terminals for more than 30 days, and some shippers have seen delivery schedules extended by six to eight weeks, according to FreightWaves .

Cross-border logistics continues to be under pressure, so cross-border sellers please ship your products with care.

Ocean Freight

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Logistics price increase