Thirteen containers of semi-finished LED televisions produced by Admiral Overseas Corporation’s factory in Xiamen, Fujian Province, got trapped in the logjam of the Suez Canal in late March.
The televisions were scheduled to arrive in Istanbul by mid-April but the blockage made their arrival date uncertain. Even though the canal was cleared on March 29, it was estimated it would take about two weeks for the traffic to go back to normal. On April 6, traffic slowed down again as an oil tanker faced engine trouble.
“We had no idea how long the goods would be delayed and we are planning to ship our subsequent goods, around 200 containers, by rail transport or via sea routes around the Cape of Good Hope,” Wang Weidi, logistics manager of the factory, told China Central Television.
The fragility of the sea-based shipping in this case made many traders reconsider the transport methods they will use in future. “As the cost of airfreight is too high, freight trains are the optimal choice for traders between Asia and Europe, with shorter shipping times and acceptable pricing,” Yu Feng, an import and export agent from Zhejiang Province, told Beijing Review. “For a long time, the Suez Canal has dominated the sea trade route between the Mediterranean Sea and the Red Sea. Now, about 20 percent of my clients have said they would like to switch to freight trains in the future.”
A 10-year move
Many other traders took action earlier as the pandemic last year impeded sea and air transport, causing unprecedented delays and higher costs. These emergencies demonstrate the advantages of China-Europe cargo trains in ensuring the stability of supply chains.
“By switching to the freight train service, we saved about 50 days of transport time and avoided potential breakdowns of the supply chain,” said Zhuang Changbo, Director of logistics at Chinese automaker Changan Ford. “With the China-Europe freight train service, we no longer worry about any disruption of maritime traffic.”
A salesperson surnamed Feng from a gym equipment company in Yiwu, Zhejiang Province, said that the skyrocketing price of sea transport and unpredictable shipping times led her to switch to rail transport.
It has been 10 years since the first China-Europe freight train left Chongqing Municipality in March 2011. Zhang Xin, who has been working at the Tuanjiecun Railway Station in Chongqing, gave the departure signal of the first Yuxinou (Chongqing-Xinjiang-Europe) freight train on March 19, 2011.
Located in southwest China, Chongqing is over 2,000 km from both the closest sea port and land border port. Key to Chongqing’s plan to transform itself into the trade hub of southwest China was exploring new methods for the transportation of goods. Transport could neither go by sea, because of time, nor by air because of the cost. The government of Chongqing settled on a plan to build a rail route to Europe via Xinjiang Uygur Autonomous Region in China’s northwest and neighboring Kazakhstan.
Those working on the launch of the rail transport network encountered many challenges. Smooth operation requires the trains to endure low temperatures of the countries they pass through, and the sharp fluctuations in temperature along the route present challenges for the goods themselves. The inspections undertaken by each country the trains pass through, including Kazakhstan, Russia and Germany, also impacted the efficiency of the trains.
Throughout 2011, only 17 freight trains departed from Chongqing. “At that time, we set the future goal of having one train depart each day, and back then we thought that goal was too ambitious,” Zhang said.
Things sped up as China announced the Belt and Road Initiative in 2013. The surging trade volume between China and countries involved boosted the development of the trains. A growing number of cities in China joined the freight rail network and by November 2020, the network had linked over 60 cities in China with 92 cities across 21 European countries.
When the world was in the claws of the pandemic in 2020, the trains played a role in transporting pandemic prevention and control supplies between China and Europe. Figures from the National Development and Reform Commission show that in 2020, the freight railway delivered 7.6 tons of pandemic prevention supplies to European countries. When the schedule was very tight, medical supplies including face masks were given priority, making it a reliable transportation channel during the pandemic.
In 2020, the trains conducted 12,400 trips between China and Europe, up 50 percent from 2019 and equivalent to sevenfold that of 2016. A manager from computer manufacturer ASUSTeK Computer Inc. told Xinhua News Agency that in 2020, the company shipped 1,000 containers of goods using China-Europe freight trains, doubling the volume of 2019.
“We received a sharp increase of orders in 2020, with more people working and learning online at home,” the manager said. “The delay in sea and air shipping put us at a high risk of default. Finally, it was the China-Europe freight train that helped to relieve the pressure.”
The busy lines
The China-Europe railway lines became busier this year. In the first two months of 2021, over 2,000 freight train services ran from China to Europe, twice the number of last year. “Now there are over 10 trains departing and arriving at the Tuanjiecun Station in Chongqing,” Zhang said. “This is a scene we could hardly imagine 10 years ago.” No accident or unexpected delay has been reported in the 10 years of operation.
Qi Dan, General Manager of Yuxinou Logistics, based in Chongqing, said the number of inquiries on rail shipping services to the company has almost doubled since late March. YQNLink, a Shanghai-based global intelligent logistics platform, revealed that the demand in Shanghai is even greater, with daily inquiries almost tripling since the Suez Canal first became blocked.
Wang Jun, Director General of the Department of Port Control at the General Administration of Customs of China, revealed that the time it takes for trains to pass through customs at land ports in Xinjiang Uygur Autonomous Region has been cut from 3.5 hours to half an hour. A new paperless system has also been put in place to further improve the efficiency of the China-Europe freight train service.
“In terms of the volume they can carry, freight trains are dwarfed by cargo ships,” said Zhao Juan, a research fellow with China Railway Economic and Planning Research Institute. A large cargo ship can carry about 20,000 standard containers. It would take 50 trips for a cargo train to transport that volume of goods.
“But for those in value-added businesses like electronic devices and pandemic prevention items, it is a viable option,” Zhao said.
Source: Beijing Review