Five Factors Influencing Shipping Container Prices
Shipping container prices vary based on customers’ requirements and global container demand. Greater demand leads to competitive prices in the supply chain. In such circumstances, sustaining and retaining your profits becomes even more necessary. The trade industry acts on profitability and networking for its dynamic growth. Therefore, choosing an appropriate and durable shipping container is essential to secure and successful trade. With an influx of different types of containers in the market, users can pick their container fleet based on capacity, usage, and price. Let’s consider the factors that influence container prices.
About Shipping Containers
Shipping containers are reusable boxes made of corten steel that provide flexibility, durability, and storage. Cargo containers facilitate easy and sustainable intermodal transport reducing the risks of damage to the integrity of the goods loaded. Available in variable sizes of 20ft, 40ft, 45ft and 53ft shipping containers are suited for transporting different types of cargo, both bulk and non-bulk. The emergence of shipping containers has widened the scope of cargo shipping tremendously. Numerous shipping companies provide container leasing and buying services to aid the trade industry and serve their clients.
Benefits of Shipping Containers
Systematic trade increases profit margins and transporting goods, raw materials, and manufactured products to global markets shapes the country's economy. Therefore, a proper selection of a container fleet helps yield multiple benefits.
- Cargo containers can carry commodities of all sizes and states.
- They can endure harsh weather and, with insulation, can also maintain an ideal temperature.
- They can be tracked through IoT technology which provides real-time data.
- They are cost-effective and available in multiple categories to suit user needs.
- They are primarily reusable as office spaces, homes or storage.
- Insurance is available to secure the user end in case of any damage to cargo.
What factors influence Shipping Container prices?
In the dynamic shipping industry, the prices of shipping containers are never static. They continue to change from time to time based on the following factors.
- Size of the cargo container - The shipping containers come in various sizes and shapes to fulfil the diverse cargo requirements. You pay more for bigger 40' or 45' containers than smaller containers. The state of cargo - solid, liquid or gas, based on cargo sensitivity determines the type of container that needs to be ordered. Perishables loaded into reefer containers require extra care and monitoring, increasing the shipping container rates.
- Condition of the Container and mode of transport - One-trip containers naturally cost more than used containers. Price runs parallel with the quality and grade of containers. Based on the nature of your goods, you can go for old used containers if their wear and tear do not harm your cargo's integrity. The location's geography determines the estimated time of arrival of shipping containers. Depending on the urgency of the requirement, consumers opt for suitable modes of container transport. In such cases, fuel costs, taxes, etc., might affect the shipping container price.
- Trends in the global market - Full of uncertainty, global trends in the shipping industry can influence shipping container rates. The recent pandemic led to a lockdown and a global outage in the supply chain. Rising inflation and a global recession are immensely hampering the trade industry. Under such unstable conditions, prices soar high. Therefore, customers are advised to analyse these trends before investing.
- High season in the shipping industry - A surcharge in the rates of shipping containers exists around July to December. The high season exists due to the heavy demand for shipping container services to facilitate heavy merchandise trade for the holiday season. Pre-planning might help in dodging this logistical congestion and prevent paying heftier prices.
- GRI and extra customs fee - Mainly associated with ocean freight, the General Rate Increase (GRI) is an additional charge imposed by shipping lines. It is done during low market seasons to counter industry losses. It can be applied once or multiple times a year and usually leads to doubling your expenses. The extra customs price, though not paid by the consumer, affects the shipping prices. Delay or detention of cargo during a customs inspection at destination ports can lead to potential losses and lower profits.
How to find cost-effective shipping containers?
Based on the factors influencing shipping container prices, we have devised a list of pointers to help save extra expenses.
- Give an excellent run-through to the companies offering shipping container services. Choose the company that provides reliable services based on your container size, condition, and category needs.
- Avoid obtaining shipping containers during high seasons, specifically the start of it. Pre-plan your transport and book the containers in advance.
- Analyze global trends in advance to avoid incurring more costs during an emergency.
- To prevent being charged additional customs expenses, make sure you have the standard legal documentation.
- One can also opt for container leasing as it is a smart investment to obtain shipping container fleets.
What is the relation between inflation and shipping container prices?
The global shipping of a significant portion of goods takes place via oceans. Fuel rates soaring high lead the shipping industry, especially ocean freight shipping, to upscale their charges. It further leads to inflation and is now converting into a global recession. In cases of inflation or recession during high season, when the global economy is falling, the profitability margin becomes uncertain for the shipping industry. Shipping container value falls as a result of a drop in demand in the supply chain. Therefore, you can expect a reduction in transportation and freight prices. When the recession or inflation lowers its effect, the demand suddenly rises, increasing the cost of shipping containers.
Proper knowledge about where and how to invest your valuable money can get you better profit margins. A brief analysis of factors influencing shipping container prices can help you find a better and more reliable shipping container fleet.
If you are confused, contact LOTUS Containers, we offer dependable and warrantied shipping container services. Using our services, you can easily rent or buy containers at the best prices to reduce your expenditure.