Alternative to High Rates and Queues

4/27/2020

Since March of this year, all spheres have been transformed. Today, ACEX experts tell about the main changes in logistics and advise the best way of transportation in the global crisis.

Main factors and trends in the international cargo transportation market:

  • March 2020 –In Russia and other countries there is a ban on exports of medical products that are used against coronavirus (excluding China).
  • March 2020 – the EU/China borders are closed for personal transport, as a result, vehicles up to 1.5 tn are "removed" from the market, including Ford Transit, Mercedes Vito, Sprinter, etc. Only trucks with a board computer for monitoring the driver's working time can go.
  • March 2020 – container trains from China (all provinces except Wuhan) to the Russian Federation / EU start moving.
  • March 2020 – almost all EU countries close their borders, restrict the people’s movement and stop air transport. All car factories and large industrial enterprises are under quarantine, and only everything related to food, medicine, hygiene and humanitarian aid remains in operation.
  • March 2020 – international air passenger service with other countries is closed. Cargo can only be carried by cargo airlines and chartered cargo airlines.
  • March 2020 – despite the fact that 85% of the fleet of major global airlines is "parked" at home airports, the remaining 10-15% of the fleet is used either for transporting masks, or with the removal of seats in the cabin for general cargo transportation.
  • March 2020 – average air freight rates have increased by more than 2.5 times, from an average of 3.5-5.5 USD/kg in imports from Asia to 10-12 USD / kg. In exports, growth showed about 300% (from 1-1. 5 USD /kg to 4-5 USD /kg).
  • March-April 2020 – there are periodically news about the closure of the borders with China for cargo transport (although it is not always the true), but this speculatively affects the prices for road transport from China to Russia and back.
  • April 2020 – the quarantine of Wuhan province is lifted. In China, the coronavirus was defeated. There are no new cases inside China among Chinese people. All cases are recorded as exclusively imported. The work of Chinese enterprises has returned to normal.

Data on changes in transit time and rates are shown in these charts:

Data on changes in transit time and rates
Data on changes in transit time and rates

Air transportation from China to Russia is still considered the fastest way to transport cargo, even though the transit time has increased by 4 times. The price of air transportation has also increased by almost 4 times, while the rates for the transportation of groupage cargo by road or rail did not increase at all or in some cases it even decreased. Taking into account the fact that the transit time of transportation by this transport has not increased as significantly as air transportation, ACEX experts recommend using the services of groupage cargo transportation in the current time.

Groupage cargo transportation (LTL and LCL) is the delivery of small-sized cargo of various customers in the same direction on the same vehicle or in the same container. There are various delivery options that differ from each other not only by the route or type of transport, but also by the balance between the delivery time and cost.

How does cargo consolidation from Europe work?

  • Delivery to the consolidation warehouse by sea or by air from anywhere in the world;
  • Cargo arrival at consolidation warehouses in the main industrial regions and major transport centers of the EU;
  • Shipment from consolidation warehouses several times a week: road transportation to Moscow on Mondays and Fridays, as well as on intermediate days in case of need;
  • Cargo delivery to any Russian regions;
  • Weekly delivery from Europe to Belarus, Ukraine, Kazakhstan and Central Asia;
  • Fast professional customs clearance.

Cargo consolidation scheme from China:

  • Cargo arrival at consolidation warehouses in the main ports of China, as well as at the China–Russia border;
  • Sending cargo by different types of transport: sea, road, rail;
  • Weekly shipments to Moscow;
  • Cargo delivery to any regions of Russia;
  • Fast professional customs clearance.

Схема консолидации грузов из Китая

Why through Europe, when there is a Vorsino station?

Railway delivery by train to Malaszewice (Poland) or Duisburg (Germany) takes 7-10 minutes, which is faster than the direct option to Vorsino. If rail delivery is not possible for some reason, there is an alternative to auto transportatiom on time and cost (faster and cheaper). Full containers via Malaszewice/Duisburg is a real alternative in comparison with air transport, in terms of time/cost.

Stages of groupage cargo transportation:

image004.jpg

Why do we prefer to work via the EU/Baltic States for groupage cargo transportation from China?

  • No bottlenecks;
  • Terms and route are transparent (there are no problems with the direct border in the Zabaikalsk region);
  • Chinese railway operators have priority in terms of delivery time to the EU, before sending to the Russian Federation;
  • All other things being equal, the cargo will get to Malaszewice faster than to Vorsino;
  • Train exit frequency is 3-4 times a week;
  • This route works in both directions, for import and export.

The route of delivery of goods between China and the EU

The route of delivery of goods between China and the EU

Why is it important to use a consolidation warehouse in Poland/The Baltic States?

After the container arrives at the destination station Malaszewice/Duisburg it requires that the named freight forwarder took the goods in his bonded warehouse for further using (Biała Podlaska, Bialystok, Vilnius). After the container is unloaded at the customs warehouse, some of the cargo is transported directly to Russia via the customs post required by the client. The rest of the cargo is transported via the route Poland-Lithuania-Russia, also via the final recipient's warehouse.

The purpose of using this scheme: full control over the delivery of cargo, including the preparation of documents for customs clearance (preparation of EPI, preparation of declarations, re-weighing, measurement, etc.)

Arrival at the consolidation warehouse

In order for the cargo to cross the border without problems you must provide the following documents:

Documents

Preparation of accompanying documents

How to safe time with ACEX?

We always do the following:

  • Pick-up schedule from EU countries to the consolidation warehouse: 2 times a week;
  • Frequency of transport from the consolidation warehouse (Vilnius) to Moscow: 2-3 cars per day (except Wednesday);
  • All cargoes are weighed, documents are checked, and a breakdown is made for passing the border;
  • If repackaging is necessary - all defects are fixed and defects are corrected;
  • When working with Guzhon watehouse, the average time for customs clearance is 4-5 hours.

For more information about the transportation of groupage cargo from and through Europe in the context of the global crisis, please contact ACEX specialists: +7-495-120-66-68, corporate@acex.net.

Calculate the cost of transportation online

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