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Freight Forwarders: Amidst Container Surplus, Good Time to Buy Containers, Enter Smaller Trade Routes and Avoid Detention Charges with SOCs  

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Freight Forwarders: Amidst Container Surplus, Good Time to Buy Containers, Enter Smaller Trade Routes and Avoid Detention Charges with SOCs  

Container xChange, an online container logistics platform, has published its annual ‘shipper-owned containers (SOCs) undercover study’ today. The report throws light on how SOCs are fitting into the overall container sourcing strategy for global shippers and freight forwarders, considering the sliding consumer confidence and eventually, free-falling shipping rates in 2023.

The report studies the real quotes offered by top 50 global carriers to arrive at a comparison of how SOC (shipper owned containers) vs COC (carrier owned containers) rates fare eventually for freight forwarders.  While the prices for COCs continue to free fall owing to declining demand and an influx of new build containers; SOCs still help in two key areas for freight forwarders – one, to avoid demurrage and detention charges (and other hidden costs) which is expected to increase this year as the newly build containers will enter the market and second, to add reliability and control in the container inventory mix. Especially when shipping against the container flow.

The report highlights that out of the 50 carriers that we reached out to, 42% responded. Out of the carriers who responded, 82% were able to offer both SOC and COC container moves.

Furthermore, some respondents showed a lack of cross-collaboration and well-rounded knowledge, with a few only caring about the container and not considering the ocean freight aspect.

Moreover, carriers are becoming less and less accepting of email correspondence, because they “have made considerable progress in [their] digital landscape and capabilities” as well as to “ensure that all [their] customers enjoy an improved experience.

“As the market adapts, SOCs will continue to thrive, and the movement of goods will continue. The drop in pickup charges is also a good sign, and building online booking systems for SOCs is an area of interest for development.” speaking on the future of SOCs, Adrian Degode, Senior Product Engineer, Container xChange, said.

In a recent webinar hosted by Container xChange to launch the report, a strong panel of experts discussed the SOC market and market opportunities.

“From an NVOCC perspective, the biggest advantage we find for SOCs is that its priced highly competitively, and we can successfully eliminate the detention charges risk, especially in the US and Canada side. With the current situation of yard congestions caused by chassis shortage, and not being able to secure return appointments with carriers on the normal COC procedures, SOCs offer ease of mind when it comes to holding off containers longer than necessary,” commented Wilson Le from Pudong Prime, Vietnam

At the webinar, it was noted that the surplus has sparked changes in container supplier operations, and a growing trend of Shipping Operating Containers (SOCs) managing the excess inventory.

“The containers are still in demand on the internal market and the containers are still used for the shipping sector. What’s really changed is the place where these containers are in demand. And so mainly, the way it affects us is the volumes that we must move, of course” added Francisco Portela, Global Repositioning Manager, Silver Sea, a Container supplier based in Barcelona, Spain. A good idea for said move might be to invest in containers, Francisco thinks: “Of course, one of the points from the excess of containers worldwide means there’ll be more places containers to buy containers from, and at better prices.”

Furthering the opportunities for freight forwarders, Alfonso Vassalo – Founder & CEO – Tagustainer, a container trader, said, “in moving COC containers even more, operational costs will become more expensive. And depots are charging; I would guess they’ll double what they would usually charge to balance out money lost amidst the rate war. And that they’ll start to sustain their profits by increasing D&D charges, and that’s really where we can help our customer with SOCs. In addition, SOCs have always been older historically. But with this sudden surplus, container traders will now be able to buy and provide younger containers” which of course is attractive for longevity.

However, let’s not forget the hurdles that come with SOC management at present: “It is the time-consuming process of booking SOCs. Communication with freight forwarders is essential from the beginning of the booking process to avoid back-and-forth emails and phone calls. Traders must understand the requirements of the freight forwarders, such as the need for the CSC certificate or any required year of manufacture, to provide a more precise and efficient response.” Afonso adds.

In conclusion, the container industry is reacting to address the surplus equipment and price volatility. Companies must be adaptable to these changes to remain competitive and should focus on diversifying their markets while keeping an eye on domestic demand. Additionally, customers are increasingly seeking more visibility into container prices, availability, and demand to prepare for times of uncertainty.

To download the report, visit: Container xChange Annual SOC Survey Report 2023. To listen to the webinar, visit: Let’s talk SOCs: Market research, trends and advice for 2023

 SOC report by Container xChange methodology

Just like in previous years, we set up a company looking to move ocean freight. We acted as a freight forwarder who wanted to move wood logs between Ningbo and Europe (or other parts of the world, depending on where the branch we contacted was).   We asked each carrier for both SOC and COC rates to compare. We reached out to the 50 biggest carriers during the period of 15 December 2022 – 15 January 2023.

About Container xChange

Container xChange is the leading online platform for container logistics that brings together all relevant companies to book and manage shipping containers as well as to settle all related invoices and payments.

The neutral online platform…

  1. connects supply and demand of shipping containers and transportation services with full transparency on availability, pricing and reputation,
  2. simplifies operations from pickup to drop-off of containers,
  3. and auto-settles payments in real-time for all your transactions to reduce invoice reconciliation efforts and payment costs.

Currently, more than 1500+ vetted container logistics companies trust xChange with their business—and enjoy transparency through performance ratings and partner reviews. Unlike limited personal networks, excel sheets and emails you rely on, Container xChange gives its users countless options to book and manage containers, move faster with confidence and increase profit margins.


FIATA Announces “Young International Freight Forwarder of the Year” Regional Winners

Four regional winners for this year’s “Young International Freight Forwarder of the Year” awards were officially announced this week by FIATA, which serves as a collaboration between the TT Club – the competition’s sponsor,  and International Federation of Freight Forwarders Associations.

Regional winners of this year’s award were determined based on dissertation topics addressing specific and complex processes within the supply chain while demonstrating logistics-based knowledge in successful implementation of the processes.

FIATA President Babar Badat announced this year’s regional winners and made the following statemen:

“Encouraging more young professionals to join the FIATA community has always been a priority for me. I am encouraged again to see these excellent candidates presenting dissertations that cover a wide range of logistic subjects, which demonstrate the challenges that forwarders face every day and the customized solutions they are able to offer.

“My sincere congratulations to the four regional winners who are ….”

Europe – Mrs. Evgeniya Khokhlova Russia (FAR)

Africa/ Middle East – Mr. Enos Chapra Zimbabwe (SFAAZ)

Americas – Ms. Rachael van Harmelen Canada (CIFFA)

Asia Pacific – Mr. Phillip Burgess New Zealand (CBAFF)

“In the current challenging global trade environment, where supply chains are under increasing pressure to adapt quickly to regulatory, political and economic pressures, we at TT Club believe the training and professional advancement of young freight operators must be paramount,” added Mike Yarwood, TT Club’s Senior Loss Prevention Executive and Chairman of the Award Steering Committee.

Among the four regional winners is the final winner of the Young International Freight Forwarder of the Year Award (YIFFYA) 2019, which will be determined and announced during the FIATA World Congress in Cape Town from October 1-5.

This year’s prize will focus on academic training including one week at TT Club’s London, Hong Kong or New Jersey regional centres in addition to a week at the company’s head office in London. All four regional winners will receive a year-long subscription to the International Transport Journal (ITJ).