CZ/SK verze

Rail Gate: FCL RAIL AND FCL SEA RATES 2021 REVIEW

Rail Gate: FCL RAIL AND FCL SEA RATES 2021 REVIEW
photo: Archives/Railway
06 / 10 / 2021

Diagram of China Main Ports to Easter Europe contrasting 2021 cargo costs of Q1 and Q2Clearly, Rail Freight Operators and Shipping Lines are working alongside when talking about the rates. It is likewise clear that when the rates are spiking, the distinction between Sea Freight and Rail Freight or Select and Premium services comes close to none. In the diagram Rail Freight rates are indicated by a red line, Sea Freight rates - blue line.

The net costs of moving goods on tracks however are way higher than moving the goods in 20 000+ TEU vessels. At least Rail Freight Operators are way more conservative than the shipping lines, which are benefiting from this whole situation.

Ideally, the circumstances will get better and prices and supply and demand balance will return to pre-COVID level but it seems like we still need to wait up until Q1 -  Q2 2022. The paradox of the current situation is that nobody was interested that shipping lines were losing money in the last 20 years. But suddenly everybody got interested in shipping lines making too much money in 2021. Of course, this is not fair from the perspectives of exporters and importers who are paying for mistakes made by carriers in the past.

Insane rate "dance" when 2 distinctive classification services have practically the same pricing will leave an impact on businesses, which will be unable to adapt. It appears that everyone is selling the space, not the price.  Hold on tight on this journey, choose the transportation partners wisely and be ready to inform your customers that the prices of your services or products are subject to change. The current market situation will continue for some time!

 

Source: Rail Gate

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