Empty containers piled up in Russia

At the height of the pandemic there developed a huge mismatch between where containers needed to be and where they actually were – a result of high demand for container ships making it difficult to move from countries whose imports had surged as a result of lockdowns and helicopter money leaving many people in the west with nothing to do and plenty to spend.

There have been echoes of this emerging in Russia, where some 150,000 empty containers have accumulated because of a huge trade imbalance between China and Russia.

According to recent analysis from Container xChange, the surge of Chinese exports into Russia since the beginning of the latter’s war with Ukraine has seen Chinese exporters struggling to find available equipment, while the price of second-hand of containers in Russia has crashed.

“There is significant cargo movement from China into Russia, but very scarce movement back,” said Christian Roeloffs, co-founder and CEO of Container xChange, adding that “containers are piling up in Russia, which means that second-hand prices are very low there – you see a 40ft high-cube container on sale in Moscow for less than $1,000, while in other parts of the world it is almost double, or more.”

Immediately prior to the Ukraine invasion, the average price of a 40ft high-cube container in Moscow was $4,175, whereas at the beginning of this week it was $580.

“Currently there are around 150,000, and everybody is looking for an opportunity to return containers back to China. All containers from Russia to China go with a pickup charge,” Roeloffs said.

“Many Chinese companies are selling containers below market price to get rid of them, since it doesn’t make sense to send them back to China. From Moscow to Shanghai, the offline market offer is around $1,500 for new containers. If cargo-worthy containers are in good condition and cost less, they prefer to sell the boxes in the local market”.

The net impact of this mismatch in recent months has been severe congestion at Russian rail terminals. The situation appears to be worsening, with some terming the state of affairs around Moscow as “critical”.