- Low sea freight rates from China to Aqaba and their causes
The prices of sea freight from China to most of the countries of the world have witnessed a significant decline, and experts attributed that one of the reasons for the decline in demand for goods is after the outbreak of the Corona pandemic and China’s closure of a number of its ports, which was confirmed by the Chinese government and that the reason for the closure of Chinese cities currently is to face the outbreak of the Corona epidemic that has reappeared in China, and the inability of workers and employers to move from one city to another due to the closures, and this led to a state of stagnation and a decline in demand Which prompted a further decline in shipping rates in an attempt to drive production.
Again, due to the pandemic and several other reasons, including the Russia-Ukrainian war, supply chains, shipping and cargo transportation around the world have entered a state of chaos, and shipping companies have not been able to cope with the increase in demand and the shortage of empty containers in addition to the increase in US demand for goods in the period of market recovery..
- How did the local market react to the drop in prices?
It is worth mentioning that most local merchants have been reluctant to increase or delay the number of orders in order to take advantage of the decline that occurred during this period and to look forward to the decline if the decline continues in order to compensate for previous losses and balance or reduce the cost of stored goods, which was caused by the high shipping prices, and therefore to mitigate the spread among traders the idea of compensation for the cost of goods shipped in the period when shipping prices were high, On the other hand, this is due to the increase in competition between shipping companies in Jordan, especially and shipping companies around the world, from the provision of competitive shipping offers to fill the decline in demand and try to push the wheel of supply and demand. Read also in the defense order specifying the ceilings of sea freight charges?
- What are the rates of drop in shipping rates?
As a comparison to the above, shipping rates from China to Iraq, for example, were from 9,000 and fell in September to $4,000 for 40,000 feet of containers, less than half in a period not exceeding three months, and freight rates from China to Jordan fell from $6,000 to $2.5,000 for 40,000-foot containers during the same period, a decrease of about 58 percent.” That is, less than half.”
- Were shipping rates from China the only ones affected?
It was not only the shipping rates from China that were affected, but the decline in demand caused a decline in shipping rates from India, especially the Indian port of Mundra to Aqaba, where freight rates from India to Jordan fell from 3,000 to 1.8,000 dollars for the 20th container, a decrease of almost 40% (since most of the containers shipped from the port of Mundra to the port of Aqaba are 20 containers due to the loading of high-weight goods such as sanitary ware, Indian tiles and ceramics).
- What will the local market benefit?
In the end, the significant rise in freight rates during the pandemic was a great threat to the recovery of the global economy, and brought developing and poor countries into an unprecedented state of inflation, and we hope that the decline in freight rates will reflect positively on the global economy and therefore we look with passion at what will result from this decline from an increase in the height and the return of life to what it was before the pandemic, especially after the experience gained from this difficult experience that the country went through in the use of resources In theright way, improving or avoiding the mistakes that have been made in the supply and shipping chains and the weakness of this system, which has shown the strength of some shipping companies in Jordan and the weakness of some.