- While some mainland European ports see slightly lower shipping costs, increases in the average cost of importing from Shanghai are universal across Europe
- Overall, shipping a container from Shanghai to Liverpool is the most expensive sea trade route into Europe
- The cost of shipping a container from Shanghai to Rotterdam or Hamburg is the lowest of any major European ports
Mismatched lockdowns, COVID-19 border restrictions, workers isolating, and changes to global trade logistics have created the perfect storm for supply chain issues.
The cost of shipping a container of goods has now increased by up to 547% more than the seasonal average over the last five years, according to a new report from ManSys, citing data from Drewry.
While some mainland European ports see slightly lower shipping costs, increases in the average cost of importing a TEU container of goods from Shanghai are universal across Europe, said the report commissioned by ManSys, a provider of business management solutions for international trade.
Shipping costs in the United Kingdom in particular are at an all-time high, the report added.
The cost of shipping a TEU container to Europe from Shanghai ranges from £5,736 (US$7,907) to £9,112. However, the cost of shipping a TEU container back to Shanghai from Europe is significantly lower, averaging between £805 and £1,117. This is a symptom of the reduced supply of containers in China, which drives up the cost of securing one.
Between 2016 and 2020, the average cost of containerized freight stayed consistent, slowly increasing year on year. However, the average cost of shipping a TEU container from Shanghai rocketed this year, with freight prices jumping from an average of £855 in 2020 to £2,492 across 2021.
Since the global coronavirus pandemic hit last year, there has been a strain on supply chains. Due to COVID-19, initial economic uncertainty and localized lockdowns led to reduced consumer demand for many goods. But when restrictions began to ease and governments encouraged economic recovery, consumer savings over lockdowns were rapidly spent on goods.
The sudden surge in demand for products, along with localized lockdowns affecting production and delivery, has meant that containers aren’t where they need to be.
There’s now congestion at several ports globally and a shortage of heavy goods vehicle drivers across Europe, causing further supply chain issues.
Overall, shipping a container from Shanghai to Liverpool is the most expensive sea trade-route into Europe, costing an average of £9,112 per TEU. It costs £3,376 less to ship a container from Shanghai to Rotterdam.
Since the Brexit transition period ended on December 31, 2020, the average cost of shipping a TEU container to the United Kingdom has increased significantly. Importing from countries such as China now often requires the cooperation of an EU member state.
The cost of shipping a container from Shanghai to Rotterdam or Hamburg is the lowest of any major European ports, with both routes costing £5,736.
“The recent increase in containerized freight costs from Shanghai is significant. It has severely impacted many companies, hugely affecting import costs. While companies importing small goods can spread additional importing costs across their supply, larger goods may see a more significant rise in pricing,” said Will Berk, international trade expert at ManSys. “The global shipping crisis is unlikely to abate, especially with Christmas coming up. Many companies are encouraging shoppers to buy early this year,” he added.
“As costs climb across the board, one way to counter additional costs is through digitising and automating as much of the importing process as possible, using artificial intelligence to speed up time intensive processes,” he added.
Image from ManSys website
