Sea freight Trend–What will happen to Sea freight in 2022?

As a Chinese promotional products supplier, the most intuitive feeling about sea freight rates in the past month, is that they have gone down!

But if we talk about the sea freight trend, we must need to discuss the original reason and underlying logic.

As we all know, in 2020, the global outbreak of the epidemic, Q1 & Q2, an extremely large number of goods out of stock, our generation of humans have not experienced this situation, never.

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From March 2020 we begin to receive plenty inquiry for PPE, and The PPE industry is all at full capacity, and even many factories that don’t do PPE are starting to buy PPE machines. Those factories that started the transition in 2020 Q3 are totally losing money.

I have some good relation factories, they work day and night, earn hard processing fees, and finally lost a lot money on the transformation of PPE. They start too late. 2020, PPE makes many people crazy.

The psychological panic and reality let us begin a variety of stockpiling in 2020 Q3 & Q4. Product purchases increased, however, transportation couldn’t keep up at the same time, coupled with the impact of the epidemic led to instability of shipping personnel, freight costs follow the rise.

Till 2021 Q1, Q2, many people realized that the merchants who stocked up in 2020 were bringing themselves huge gains, so more people poured in to buy goods, and freight rates went straight up to an all-time high.

Chinese factories are also both happy and sad. Happy is the amount of orders soaring, sad because of the soaring shipping costs, prices depressed, the soaring orders did not bring more profits, but are eaten by the sky-high sea freight.

In 2021, boat companies are the big winners.

As a result, the reason and underlying logic behind the rising ocean freight rates are the epidemic impaction accompanied by rising demand.

Too much overbought in 2020 Q3 Q4 and 2021 Q1 Q2. The inventory takes some time to digest. As of 2021 Q3, Q4, demand has started to decline.

In 2022, the shipping rates will never again be as high as the rates in 2021.

For now, in April 2022, From Shanghai port to LAX, one 40HQ cost around $9000. But it will take more time for freight rates to fall back to pre-epidemic levels.

Below is the March sea freight cost from Shenzhen to LAX and New Orleans.

I hope this article will provide you with useful information.

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