Analysis of the recent extension of the delivery time of goods

**Analysis of the recent extension of the delivery time of goods**

Since the China-US trade agreement was reached in early May, the global shipping market has ushered in a new round of demand peaks, resulting in a continuous increase in shipping costs. Recently, many shipping companies have raised their quotations, and the freight rates of some popular routes have risen by more than 200% compared with the beginning of the month, which has brought significant cost pressure to export companies. Many manufacturers or customers choose to postpone the delivery time to avoid the impact of high freight rates.

Analysis points out that the delay in delivery is mainly driven by three factors:

1. **The freight rate increase is too high, and the cost is greater than the benefit**: In the face of the surge in shipping costs, it has brought huge cost pressure to customers' purchases. Customers found that continuing the order will lead to serious losses during the order calculation process. Therefore, many customers choose to wait and see and delay delivery, waiting for the freight rate to be reduced before shipping.

2. **Insufficient shipping capacity of shipping companies**: Since the beginning of the year, due to the continuous decline in freight prices, some shipping companies have begun to reduce their capacity and adjust the number of routes. Faced with the sudden increase in orders, the capacity is seriously insufficient, resulting in tight space.

3. **The peak season for procurement arrives early**: Every summer, chemical companies will enter the annual maintenance period. During this period, production will drop significantly and product prices will also rise sharply. In order to avoid the impact of price increases, international companies have started purchasing plans in advance. Due to the excessive concentration of orders, the delivery period has been extended.

**Future Outlook: The extension of delivery period may continue until the end of the year**

The industry generally predicts that under the background of the recovery of Sino-US trade and the adjustment of the global supply chain, the delivery cycle will not change in the short term. This phenomenon will only be alleviated after the freight rate is reduced. The reduction in freight rates is expected to show a downward trend in the fourth quarter.

For customers who have recent purchasing plans and whose freight rates continue to rise, we recommend that customers wait and see the market situation and purchase after the freight rates fall.