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By Sam Whelan
The Pearl River Delta port congestion has triggered another spike in volumes and rates for China-Europe rail freight, causing delays and equipment shortages.
Last month, the number of trains rolling along Silk Road tracks continued the double-digit growth experienced so far this year: 1,357 train trips carrying 131,000 teu, up 31% and 40%, respectively, year on year, according to China’s National Development and Reform Commission.
And while Yantian International Container Terminal is getting back up to speed, the container shipping backlog at the port could yet take weeks to untangle, leaving many shippers turning to rail to get their cargo out of China.
However, Marco Reichel, Shanghai-based APAC business development director at Crane Worldwide Logistics, said the ocean freight congestion was impacting rail.
“Equipment is very limited in South China for rail freight,” he told The Loadstar. “There has been a lot of demand for rail, due to the delays at Yantian, which is likely to continue, given the current congestion at Nansha.”
The congestion has spread to rail hubs, too, confirms Robert Foster, business development manager for central and north China at Norman Global Logistics. He explained: “There are congestion problems at most main hubs; we are seeing between seven and 10 days’ delay in China, as well as delays of one-to-two weeks at the Belarus/Poland border crossing.
“It’s being caused by the issue in Yantian and the lack of space on vessels. In some cases, ocean carriers are asking a minimum of two weeks before you can obtain space, and whereas rail is the same, there is a quicker transit time if all moves smoothly.”
Following the disastrous delays in the Pearl River Delta, Mr Foster also confirmed rail demand was “very much” on the up, pushing prices to record levels, due to the lack of equipment and space.
“Rates jave reached around $17,000 [per feu] to Hamburg, give or take a few hundred dollars, depending on the origin point,” he said. “the highest we’ve seen.
“But I expect prices to increase further in the second half of July, because ocean rates are still increasing and rail tends to follow suit.”
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