By Rui Hu, EDITOR
It is generally known that Chongqing is located at the junction of a Y-shaped pattern connecting the Silk Road Economic Belt, the 21st Century Maritime Silk Road, and the Yangtze River Economic Belt, enjoying a unique geographical advantage. In recent years, it has built five international logistics channel systems of the east, west, south, north, and aviation in virtue of international railway channels and the Golden Waterway of the Yangtze River.
Two trains of China-Europe Railway Express (Chongqing) and ILSTC were respectively dispatched
According to Chongqing Port Logistics Group Co., Ltd. (the Group for short) on August 8, Chongqing had initially realized the seamless connection of its international logistics channels in Guoyuan Port, which provides a new opportunity and carrier for the city to further improve the level of opening-up and accelerate its integration into the global industrial chain.
How do the three international logistics channels in Chongqing work? What’s their advantage over each other? How much does the logistics cost and how long does the delivery take? How should cargo owners choose? A contact at Port Logistics Group answered these questions.
three channels completed the foreign trade volume of 666,400 TEUs last year
Currently, the east channel, connecting the Pacific Ocean through the Golden Waterway of the Yangtze River, has embraced more than 190 international routes leading to over 200 countries and regions worldwide; the west channel can reach countries in Central Asia and Europe via China Railway Express (Chongqing); the south channel can lead to countries in Southeast Asia and Europe via Chongqing-Guizhou-Guangxi-Singapore rail-sea multi-modal logistics passage.
According to the person in charge, the east channel is worth recommending for its large transportation capacity, low transportation price and high marketization degree, the west channel has the advantage of short transportation time, while the south one features short domestic transportation time.
Data show that in 2018, the volume of foreign trade finished by the three channels reached 666,400 TEUs, among which 487,400 TEUs were finished via the Golden Waterway of the Yangtze River, accounting for 73% of the total, and those via China Railway Express (Chongqing) and Chongqing-Guizhou-Guangxi-Singapore rail-sea multi-modal logistics passage accounted for 17.7% and 9.1% respectively.
Cargo owners can make choices through a formula
What are the differences between the three channels in logistics costs and transportation time?
For example, it takes 15/41/45 days to transport a 40-foot container from Chongqing to Germany via China Railway Express (Chongqing) / Chongqing-Guizhou-Guangxi-Singapore rail-sea multi-modal logistics passage/the Golden Waterway of the Yangtze River, with the logistics costs of 3,500/2,480/2,200 USD respectively.
For another example, it takes 13/18 days to transport a 40-foot container from Chongqing to Singapore via Chongqing-Guizhou-Guangxi-Singapore rail-sea multi-modal logistics passage/the Golden Waterway of the Yangtze River (river-sea multimodal transport), with the logistics costs of 950/1,050 USD respectively.
By calculating the transportation expense at an average profit rate of 8% of the enterprises’ total profits, the person in charge drew the following conclusion. It costs 280 USD more but takes four days less to transport a 40-foot container from Chongqing to Germany via Chongqing-Guizhou-Guangxi-Singapore rail-sea multi-modal logistics passage than via the Golden Waterway of the Yangtze River (Chongqing — Shanghai — Hamburg).
For the cargo owners, if the two modes’ sums of the transportation expense and the time costs are equal, then the two modes will be equivalent and can be substituted for each other.
To make it clear, the person in charge further explained with a formula: A×8%÷365×4=1960 (“A” represents the cargo value and is equal to 2.236 million RMB).
It means that the cargo value of each container is 2.236 million RMB when the two modes are equivalent. More specifically, if there is a delay of less than a week without significant depreciation of the goods, it will be more cost-effective for the owner of a 40-foot container valuing over 2.236 million RMB to choose Chongqing-Guizhou-Guangxi-Singapore passage. Otherwise, the Golden Waterway of the Yangtze River will be a better choice.
According to the above formula, if China Railway Express (Chongqing) and the Golden Waterway of the Yangtze River are equivalent, and there is a delay of less than a month without significant depreciation of the goods, it will be more economical for the owner of a 40-foot container with the cargo value of over 1.383 million RMB to choose China Railway Express (Chongqing). Otherwise, it’s more economical to choose the Golden Waterway of the Yangtze River.
Source: CQCB
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