Leading Up to Chinese New Year: The Asia-Europe Trade Lane
Chinese New Year is approaching – February 10th – and shippers and forwarders alike are preparing for capacity and equipment shortages as we lead up to the traditional Lunar New Year demand.
As we have mentioned before, factories are expected to slowly start closing up to February 9th (a day before the holiday on the 10th) and will not resume shipping/loading trucks/etc., until at least the 15th, perhaps even until the 20th.
The Southeast Asia-Europe trade lane has seen the most significant impact thus far, according to visibility platform project44.
The Suez Canal provides the shortest shipping route between Europe and Asia. If shippers have to re-route around the Africa on the Cape of Good Hope, it can add an extra 3,500 nautical miles onto a ship’s voyage, per the South China Morning Post.
This China to Europe railway route runs through more than 100 cities in 11 Asian countries and regions and reaches 217 cities across 25 European nations. It is mainly used for westbound Chinese exports. Some say it could be an alternative route for shippers. While others feel like yes it could be alternative, but how good of an alternative can it truly be?
Additionally, as the South China Morning Ports notes, the geopolitical challenges in Ukraine has played a role in some shippers viewing the railway route as not an ideal option. Largely because the trains typical run through Russia, and now the most popular route crosses the Caspian Sea, which takes longer than usual.
The China-Europe Railway Express did see a lot of success last year. In the first 11 months they operated a total of 16,145 trains – which equals about 1.75 million 20-foot containers being transported, which exceeded the total volume that was recorded in all of 2022.
Suez Canal Volume Down but U.S. Imports in December See Slight Increase
In what should be no surprise, the Suez Canal has seen a decrease in volume. Specifically, in the second half of December, the Suez Canal volume was down by a quarter, per Maritime-Executive.
“[We’re] watching the ongoing tensions in the Red Sea closely and examining their effect on the navigation traffic through the Canal in the light of announcing some shipping lines are shifting their journeys to the Cape of Good Hope route..,” the Suez Canal Authority said in a news release.
In the month of December, the U.S. imported 2,107,012 TEUs, which is up just slightly at 0.4 percent from the previous month.
You can take a look at the graph, by Descartes, that further shows the ups and downs of U.S. container import volume from 2019 through 2023. As you can see, December 2023 volumes were higher than 2019 and 2022, but lower than 2020 and 2021 (which saw a huge increase during the pandemic).
Even amidst the challenges, shipping still goes on.