After strict restrictions were lifted in China, the situation improved; the country has opened to business and tourism. Since there are no lockdowns or mass quarantine, production lines work around the clock. Shipping cost is one of the major factors for importers. Fortunately, the shipping cost is at its lowest in several years. It is the perfect time to source products.
Long-awaited low shipping cost for shipments from China
In August 2021, sea shipping rates reached an astronomical USD 20,000 per 40′ container. Fortunately, since then, the transportation cost has been falling. In March 2023, the price for shipping a container on the China-Europe route by sea dropped below USD 1,000. The cost of sea transport of a container from China to North America plummeted to USD 1,200/TEU, and on the China-Middle East route to approx. USD 1,000/TEU. Cheaper shipping from China also means lower transportation costs on other routes.
Rail freight and sea freight from China to Europe
For a long time, rail freight transportation was considered a cheaper alternative to shipping by sea. Now rail transportation from China to Europe is more expensive than sea freight. How have the rail freight rates changed in relation to sea freight rates?
- In March 2022, sea shipping (40′ container) cost around USD 1,000 more than shipping by rail.
- The situation changed a few months later. In November, rail freight transportation was more expensive, even by USD 2,500.
- In March 2023, transportation prices fell by approximately USD 2,000 per container overall. Rail freight transportation was still a more expensive option than sea shipping by about USD 1,000.
Air freight from China 2023
A downward trend is also observed in terms of air cargo rates, although not as significant as in the case of sea/rail transportation. The rates have been relatively stable since the beginning of the year. Air freight is the most expensive option, but it is the only proper means of transportation in some cases.
Sea, rail, and air freight rates from China, March 2023 – comparison
- FCL sea freight, HC 40: Tianjin → Gdansk, USD 1,500-3,000 (35-40 days)
- FCL rail freight, HC 40: Jing’an → Gdansk, USD 2,500-4,000 (25-28 days)
- Air freight, 200 kg: Yiwu → Cracow, USD 5,800 (10 days).
Will shipping be cheaper?
The current shipping rates for goods are at similar levels as in 2018/2019. Freight rates are low and most likely will not be lower. It is also important that the rates have stabilized for now. The shipping cost is expected to increase in the second half of 2023.
Shipping from China in 2023 – advice for importers
To reduce the risk when shipping from China or any other location, it is good practice to diversify the shipment. For example, instead of shipping one large container (40′), shipping two smaller ones (20′), one by sea and the other by rail, is safer. You can also recalculate prices for other origin/destination ports for the optimal outcome.
However, it should be remembered that it is difficult to predict the final cost of transportation.
- Shippers can be charged cancellation fees if they cancel shipments.
- Companies add a fuel surcharge (Bunker Adjustment Factor, BAF) to the shipment. It is a fee to compensate for the fluctuations in fuel prices and can be a high additional cost.
- If your cargo has not been loaded on a ship due to blank sailing (when a vessel skips a port or a route is canceled), you most likely will be charged with demurrage.
How can you be sure that you choose the best offer for you? You can check shipping prices for your shipment on ShipHub for free. Fill out the form like below and choose the best offer for you.
