Imports from China skyrocket shipping rates

In the first five months of this year, there was a 60% monthly increase in imports from China to Mexico, which has translated into upward pressure on the costs of maritime transportation and products.

The increase is due to trade tensions that have led China to use Mexico as its gateway to the United States, the country with which it has conflict; coupled with geopolitical and environmental tensions that limit the movement of ships through places such as the Red Sea and the Suez and Panama canals.

Although approximately 73,000 20-foot equivalent containers (TEU) were shipped from China to Mexico each month between January and May 2023, in the same period this year this number increased to 117,000 TEU, which has resulted in an increase in maritime rate, which began the year with just over $2,000 and is above $5,000 per TEU.

The increase in commercial volumes has not been the only factor that increased the cost of transportation.

More details

The EAX index, prepared by the logistics company Eternity Group México, maintains that the increase in the price of maritime freight from China is due to the market’s reaction to the robust demand, “exacerbated by congestion at origin and lack of empty equipment available in China”, derived from the growth in volumes of sectors such as consumer goods, automotive and industrial, favored by a competitive exchange rate for the purchase of goods abroad and a still solid domestic consumption.

At the end of April, the EAX index quoted freight at $3,959 per 40-foot container (FEU), a rate level not seen since September 2022.

“We observe that the ports of origin continue to be saturated and face serious challenges in the short term, generating upward pressure on the rate that will continue during May. Due to the high volatility (…) it will not be absurd to observe rates in May trading in ranges around 5,500 – 6,500 dollars per FEU,” according to the firm.