According to reports, Evergreen Marine Corp. recently officially issued year-end bonuses to employees. The bonus amount is not 10 or 20 months as the outside world had guessed, but 40 months!
This is not envy, this is crazy! Global container ship freight rates have soared, and the “salary” situation in the shipping industry has reached its highest point. Evergreen Shipping will earn more than NT$200 billion (approximately RMB 46.068 billion) this year. The year-end bonus was officially credited to the account. When many employees saw the account early in the morning, their first reaction was “I have never seen so much money.” They also rubbed their eyes for fear that they had read the wrong number.
The epidemic has brought down many industries, but the shipping industry is definitely a special case among special cases. It has turned around since the fourth quarter of last year. Recently, due to the series of port blockades, the soaring shipping freight has remained high. Shipping companies’ revenue this year Continued strength. Although new ships will be invested in the next three years, the shipping market is expected to be “still OK” by 2023.
Taking Evergreen Shipping as an example, its after-tax surplus in the first three quarters has reached NT$158.279 billion (approximately RMB 36.458 billion). There is no sign of a drop in freight rates in the fourth quarter. It will not be a problem to earn more than NT$200 billion for the whole year. Compared with Last year’s revenue of NT$24.3 billion earned “one more zero.” Last year, Evergreen generously issued a 10-month year-end bonus. How much it paid has long been the focus of everyone.
Evergreen Marine always distributes bonuses on the working day before New Year’s Day. Many employees are waiting for the year-end bonus to be credited. When they saw the confirmed amount of the year-end bonus credited early in the morning, they asked “Did you read it wrong?”, with a basic salary of NT$60,000. (approximately 13,800 RMB), I earned more than NT$2 million (approximately 460,000 RMB) in one breath. I shouted “Oh my God! I have never seen so much money in one time.” It is not super cool to describe.
The continued high shipping prices are a pain for traders!
In 2021, my country’s foreign trade import and export will maintain growth. The continued high shipping prices have brought huge dividends to shipping companies, but at the same time, they have also brought considerable pressure to foreign trade companies.
According to reports, although soaring freight rates have brought huge profits to container shipping companies such as Maersk Group and COSCO Shipping Holdings, importers are also facing high costs that are more difficult to absorb. Some companies have raised retail prices, exacerbating central bankers’ concerns about inflationary pressures, while supply bottlenecks caused by the epidemic are also hampering economic activity.
According to Bloomberg, before the outbreak, most shipping analysts would have never imagined charging $10,000 per container on the route from Asia to the United States. Drewry data shows that between 2011 and March 2020, the average freight rate from Shanghai to Los Angeles was less than $1,800 per container.
The sea freight from China to the Mediterranean has risen to US$12,400 in July 2021, and exceeded US$13,000 in August. Before the epidemic, the price was only around US$2,000, which is equivalent to a six-fold increase. In addition to the significant increase in costs, what is even more difficult is that not only are the prices now high, but it is also difficult to book space and containers. “It’s hard to get a container. It depends on connections. Whoever pays the higher price will give it to whom. This was not possible in the past.” Imagine. For textile and clothing products with seasonal characteristics, the impact of goods not being shipped is even more serious. Meng Zhuo, manager of Anhui Garment Import and Export Co., Ltd., told reporters that bulk orders for autumn and winter clothing will be placed as early as the end of August. They were previously shipped out in order to catch up with the launch in North America in early October. However, we finally overcame challenges such as high costs and the epidemic to complete the order in time. If it cannot be shipped out, once the season is over, no matter how good the customer is, they will not want these goods. .
Sea freight has become a stumbling block for the recovery of foreign trade market
Freight is rarely taken seriously by buyers and sellers in the textile trade process. This cost is almost negligible when air freight is not involved. Before 2020, the price of shipping a container to the UK was US$2,500, but now the price is quoted at US$14,000, an increase of more than five times. Now it is difficult for any trader to ignore this part of the cost. With freight prices soaring, people engaged in textile foreign trade are also suffering from it. They lamented, “I have never seen such a high price in ten years of business! This business is out of business!”
Sea freight has become a stumbling block to the recovery of foreign trade. It is understood that textile export companies faced three major difficulties in 2021: soaring sea freight, rising exchange rates and continued rise in commodity prices. “The surge in sea freight rates is due to the outbreak of foreign epidemics, especially in India, which has greatly affected the global supply chain. Pushing the supply chain upward will affect the imbalance of global shipping, causing the freight rates of domestic ocean routes to soar. But other countries Because of the epidemic, there may be many containers piled up at the port and can be shipped quickly, so their sea freight is relatively low.” For example, the industry insider said that the freight for a container has increased from 5,000 US dollars to 10,000 US dollars. US dollars, and the entire container may only be worth US$30,000, with freight accounting for more than a quarter. “This makes some products with relatively low profit margins less competitive than those from other countries.If the product is no longer competitive, there is no need to export it, because you will lose money by exporting.” Currently, it is understood that many foreign trade companies have received news that customers have stopped shipping due to high sea freight, and the trend of future costs will continue Rising, profits have been squeezed again and again!
At the end of the year, the textile foreign trade market became loose, and orders received in the early stage were tepid, with little improvement. Recently, news of improvement came out, and orders began to increase. However, today’s sky-high sea freight has invisibly increased cost pressure on foreign trade textile companies, forcing them to raise their quotations. However, it is also easy to lose orders due to high prices.
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