At this moment, the railway transport of goods is a fast and more reliable alternative to sea transport

The largest share of world trade is carried out by sea transport. It is this type of transport that has been subjected to a number of challenges since 2020 - the COVID-19 pandemic, the lack of equipment and the congestion of the Suez Canal.

At the end of 2023, a new shipping crisis that threatened world trade and negatively affected the economy broke out - the conflict between Israel and Palestine and the subsequent attacks on merchant ships by the Houthis from the territory of Yemen, which borders the main trade route from the Far East to Europe through the Red Sea and the Suez Canal.

This resulted in a crisis with an avalanche effect, and the extended transit times due to the bypass of Africa led to shortages of ship space and equipment, as well as congestion in a number of Asian and European ports. This, in turn, pushed the peak season earlier than usual to May, as European recipients, scalded by late deliveries in 2021 and 2022, wanted to ensure on-time deliveries. Some companies have even started stocking up for the Christmas holidays as early as spring. In response to this - and due to the experience of price increases accumulated during the pandemic - shipping lines announced additional charges such as PSS (Peak Season Surcharge) and GRI (General Rate Increase).

"At the moment, the transport of goods by railway continues to be a fast and more reliable alternative to sea transport, offering a transit time of about up to 20 days from the starting station to the final station compared to an average of about 60-70 days by sea", commented the specialists from the logistics provider Cargo-Partner Bulgaria, refering to their 20 years of experience.

According to analysis by Sea-Intelligence, if the current crisis in the Red Sea, increased demand and congestion persist, current bid prices for the most used 40-foot containers are expected to reach record levels of USD 20,000. In comparison, during the COVID-19 pandemic, Asia-Europe fares reached just over USD 14,000. Currently, the industry-leading SCFI (Shanghai Containerized Freight Index) has reached its highest level since August 2022. Market research indicates that 70% of cargoes with long-term price agreements have been delayed by the lines or renegotiated at higher prices.