In the shipping and logistics industry, a “container crisis” is emerging due to China’s overproduction and the subsequent rush to export surplus inventory at low prices. This issue is compounded by U.S. importers stockpiling inexpensive Chinese products through platforms like AliExpress and Temu ahead of the scheduled tariff increase on Chinese goods in August. Consequently, there is a pronounced “China-centric phenomenon” involving container ships and storage/transportation containers. South Korean export companies are now grappling with twin challenges: soaring shipping rates and an acute shortage of containers.
The “container box crisis” is becoming increasingly severe in various regions. Recently, a freight transportation company had to cancel a contract for two 40-foot containers scheduled to depart from Busan to New York just a week before departure at the end of last month. Despite booking a month in advance, the shipping company responded that no containers were available. A company representative mentioned, “We have even experienced cancellations just two days before departure, causing inevitable delays and financial losses. Refrigerated containers are completely unavailable.” Similarly, a small business reported that their cargo, which was supposed to ship in the second week of last month, has been indefinitely delayed due to the container shortage.
Jun-woo Jeon, a professor of Global Logistics at Sungkyul University, explained, “Container boxes need to circulate globally along shipping routes, but the focus on the China-U.S. route has driven rental fees to skyrocket, impacting other regions as well.” According to the shipping logistics consulting firm xChange, the rental fees for container boxes on routes from Shanghai, China, to major ports in the U.S. and Europe have surged two to three times over the past six months.
Even with the steep rise in shipping rates, there are no containers available to send cargo, making it a moot point. Large domestic shipping companies like HMM have their own containers and only need to rent a few from leasing companies, but small and medium-sized companies face a more difficult situation as they have to rent through forwarding agents.
This means that even if companies are willing to send cargo at a high price, there are no “boxes” available to put it in. While large national carriers like HMM own container boxes and only need to rent a few from leasing companies, small and mid-sized companies are in a worse position, as they have to rent containers from forwarding companies.
