By Nick Lung      Photo：Kirandeep Singh Walia

Statistics show that in January 2023, the volume of containers exported from Asia to the United States will be 1,427,796 (calculated as 20-foot containers), which seems to have decreased by 17%. This is down 6 percentage points from 23% in December 2022. The 6-point decline partly reflects solid retail trends in the US. However, some people pointed out that the inventory level in the U.S. retail market is still in excess, and no one can guarantee whether freight will improve.

Although freight forwarders and shipping companies are highly positive about the improvement in the economy and insist that the shipping market will turn around in Q2, the basis is that the increase in consumer prices (CPI) and producer prices (PPI) in January has far exceeded expectations , the sales volume of the retail industry has also reached a two-year high. After the inventory clearing is completed, the shipment tide may begin to appear in Q2, and the demand in the shipping market is expected to rise by then

From the data in January this year, it can be seen that the decline from Asia to the United States was 17%, of which only Vietnam showed positive growth. Although the number is not large, it represents the continuous decoupling of China and the United States. In the past, it was known as the world's factory. China's export trade seems to be suppressed by geopolitics, which further affects its own trade. Whether other countries, such as India and Vietnam, can become new world factories and play an important role in the global supply chain is still the focus of attention. Vietnam is still a socialist country led by the Communist Party. There are also differences in cultural and economic openness. As for the population of India, which is the second largest country in the world, and relying on its own huge domestic demand, major international manufacturers have shifted their focus to India. However, India’s caste system, language and cultural barriers are not conducive to foreign management. In addition, in terms of infrastructure It is very lacking. Whether it is software or hardware, India still has a long way to go before it can successfully transform itself.

Appreciate if you could share TGL Blog among your friends who are interested in first-hand market information of supply chain and updated economic incidents.