Shipping costs from South Korea to Europe have more than doubled year-on-year! Export companies face huge challenges →
2024-08-23
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(CCTV Finance "World Finance")The latest data released by the Korea Customs Service recently showed that shipping costs from South Korea to Europe in July more than doubled compared with the same period last year. As the Red Sea crisis continues, the sharp increase in shipping costs has brought a shock to Korean companies.
Zhu Hongyu, special correspondent of the Financial ChannelAccording to the latest data released by the Korea Customs Service, the average shipping cost from Korea to Europe has soared to more than RMB 43,000 per 40-foot standard container in July this year, a 212.2% increase compared with the same period last year. On the one hand, due to the impact of the Red Sea crisis, shipping companies have detoured around the Cape of Good Hope in South Africa, resulting in poor sea transportation; on the other hand, the increase in logistics volume and the shortage of ships in the international market have also driven up shipping costs.
South Korea is a typical export-oriented country. In particular, sea transportation accounts for 99% of South Korea's foreign trade transportation. The sharp increase in sea transportation costs has had an adverse impact on some of South Korea's exports. For example, 90% of South Korea's exported used cars are generally shipped through Incheon Port. In the first half of this year, the number of used car export declarations at Incheon Port decreased by about 5% compared with the same period last year. The number of declarations in June alone dropped by more than 30% year-on-year.
The long-term tension in the Red Sea has also impacted the logistics and transportation of South Korea's home appliance, petrochemical, tire and other industries. For example, data shows that in the first half of this year, the logistics costs of Samsung Electronics in South Korea increased by about 63% year-on-year. As overseas sales account for more than 80%, in order to solve the transportation bottleneck, the three well-known tire companies in South Korea give priority to ensuring transportation ships in the short term, and consider expanding production capacity in Europe and other places in the medium and long term.
This is the case for large companies, and it is even worse for small and medium-sized enterprises with weak risk resistance. A survey by the Korea Trade Association showed that more than 80% of the export companies surveyed believed that the current high logistics costs and ship shortages have seriously affected the normal operation of the companies. Korean society is worried that high shipping costs will remain high for a long time, and it will be difficult for many Korean companies to avoid a decline or deterioration in profits.
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Editor: Li Cong
