Due to the global effects of the COVID-19 epidemic, the dependence of international trade on the sea route has increased considerably in the last two years. In this context, the need for containers has also increased. At this point, there is a serious imbalance in the supply and demand of containers.
According to data released by British consulting firm Drewry, 96 percent of the world’s dry cargo containers and all reefer containers are produced in China.
The global economy is showing a recovery trend this year. While the import activities of developed countries such as the United States of America (USA) returned to normal, the lack of workers due to the epidemic led to a build-up of containers in the ports. Apart from the USA, a similar situation exists in countries such as New Zealand, Australia and the UK. On the other hand, some Asian countries, which are important production points, are experiencing a serious lack of containers due to the inability to return the containers on time.
With the increase in container demand, there was a great increase in container prices. Many container manufacturers in China are trying to expand their production capacity to meet the current container demand. According to information obtained from a container manufacturer company in Xiamen city of Fujian province, China, the company’s factory produces a container every three minutes.
Production capacity of the three largest container manufacturing enterprises in China accounted for 82 percent of global capacity in the first quarter of the year. According to the data released by the China Container Industry Association, China has ranked first in the world in terms of container production and sales for the last 25 years.
CONTAINER MANUFACTURING SHIPPED TO CHINA IN THE 1990S
With the intensification of maritime transportation in the 1960s, container transportation also became widespread globally. While the container production center was the USA, with the effect of economic and logistics factors, the center moved to Europe, then Japan and South Korea in time. In the 1990s, container manufacturing shifted from South Korea to China, thanks to the rise in China’s production capability, the steady increase in export demand, and its financial advantage
China has continuously increased its container production capacity and surpassed South Korea by 1993. While the share of China in the global container market was 7.2 percent in 1990, this number increased to 69 percent in 1999.
EUROPEAN TRAINS INCREASED THE NEED FOR CONTAINERS
After the reform and opening up policy in China, the increase in foreign trade and the introduction of China-Europe cargo train services have given a great impetus to the development of China’s container manufacturing. There are three important reasons behind China’s being the largest container producing country.
The first is that the containers produced in China have advanced technology. With the widespread use of environmentally friendly water-based paints, container manufacturing technology in China has outstripped its competitors. Second, the acceleration of smart technologies in the manufacturing sector in China.
Third, the multifaceted development of container production in China. For example, a wide variety of containers for dry, liquid and frozen cargoes have been developed in China, thereby meeting different demands. China’s huge domestic market also provides strong support for the development of the container industry.
The opinions expressed herein are the author’s and not necessarily those of News2Sea.
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