Recently, Maersk, a shipping group, reported higher than expected first quarter profits. Maersk stated that between January and March, the number of containers it loaded on board decreased by 9% compared to the same period last year, while the average freight cost decreased by 37%.

It is reported that due to the surge in customer demand and port congestion related to the epidemic, the company's profit hit an all-time high last year. But then, with the global economic recession and the collapse of the import foam of the United States and other major consumer countries caused by the epidemic, freight rates fell sharply.

Weak demand under foreign inflationary pressures

Data shows that China's foreign trade maintained growth in the first four months of this year, with a total export volume of 7.76 trillion yuan, an increase of 10.6%. Among them, exports were particularly strong in March, with a year-on-year growth of 23.4%, much higher than market expectations.

However, in response to the unexpectedly high export growth, there are still sluggish shipping prices and a large number of empty containers on the docks. Many foreign traders and freight forwarders also expressed that they did not feel the warmth brought by export growth.

At the same time as export data has skyrocketed, it is also a fact that containers that were once "hard to find" are now largely empty. Against the backdrop of sluggish global economic recovery and huge inflationary pressures facing the European and American regions, demand in overseas consumer markets remains weak. The European and American markets are precisely one of the important markets for China's traditional manufacturing exports, which has exacerbated the large number of empty containers.

The General Administration of Customs also responded to the issue of empty container stacking at ports in March, stating that this is due to the previous period of excessive new container placement, low domestic storage costs, and short-term significant backflow of empty containers after the relief of the foreign epidemic, as well as seasonal patterns.

At present, the decline in consumption power caused by high inflation pressure is immediate. Last year, we believed that the export downturn was due to the inventory backlog of the past few years that has not been digested, and now it seems that foreign consumers have no money in their pockets. "The head of a company said that at the beginning of the epidemic, due to factors such as poor supply chains, the efficiency of major airlines significantly decreased. However, starting from the second half of 2021, the situation began to reverse, With the decline in crude oil prices, the gradual easing of global supply chain pressure, and the beginning of a downward trend in demand, the container market has shifted from being "hard to find" to "empty container accumulation". Coupled with last year's high base, the CCFI freight index has experienced a year-on-year decrease of about 70%.

The vacancy of containers does not necessarily indicate the overall difficulty of exports, but it does reflect the reality of the difficulties faced by traditional manufacturing exports. The further recovery of overseas market demand is currently the industry's biggest expectation.

In addition, the Economic Reference Daily published an article at the end of April stating that since March, the level of empty container storage in multiple ports in China has dropped from a high point, and container usage is gradually recovering. Experts predict that with the overall improvement of China's economic operation and the continuous efforts of measures to stabilize the scale and optimize the structure of foreign trade, the positive trend of China's foreign trade is expected to continue, and the export of containers will gradually increase. This year, the growth of the main indicators of coastal port production will rebound.