The China Europe Railway Express (CRE) connects China and Europe through an extensive network of rail services. Read this blog to find out all about the CRE and how you can source containers to move your cargo on this route.
In 2023, 1.9 million TEUs of containers were shipped via the China-Europe Railway Express. China National Railway attributes this increase in traffic to several initiatives it implemented for the China Europe Railway Express. We’ll discuss more about this later in the blog.
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What is the China Europe Railway Express?
The China-Europe Railway Express, or China Railway Express (CRE), is a network of international multimodal container rail services that connects cities in China with cities in Europe. It provides overland transportation for cargo, bypassing the traditional maritime routes that typically connect these two regions. It is part of China’s Belt and Road initiative and since its launch in 2013, the project has expanded to Asia, Africa, Oceania, and Latin America.
For many shipping companies, the China-Europe Railway Express has become a more reliable alternative for transporting via sea – as the CRE is faster and more cost-efficient. Let’s take a detailed look at the routes it covers.
China Europe Railway Express route
The China-Europe Railway Express (CRE) operates along three major corridors: the eastern, central, and western routes.
-The eastern route primarily serves Chinese exports from coastal regions, notably Yiwu in eastern Zhejiang province. It exits China through Manzhouli in Inner Mongolia, traverses Russia, and enters Europe via Belarus and Poland.
-The central route is dedicated to goods produced in central China and the southern coastal provinces like Guangdong, a manufacturing hub. It enters Mongolia through Erenhot in Inner Mongolia, crosses Russia, and then reaches eastern and western Europe.
-The western route primarily facilitates exports from western China, entering Kazakhstan via Alashankou or Khorgos in the Xinjiang Uygur Autonomous Region before extending further into Europe. Most of these routes pass through Russia, Belarus, and Poland, with a few trains also transiting through Ukraine en route to Hungary.
Let’s understand these routes through a map.
China Europe Railway Express map
As you can see from the map below, the China Europe railway does not travel along a single route. It is a network of railways that spans over the two continents – departing from China, passing through Central Asia, and finally arriving in Western Europe – mirroring the ancient Silk Road.
China-Europe Railway Express trains are now running on 73 routes, connecting more than 50 cities in Mainland China with 217 cities in 25 European countries.
If you want to ship your cargo on this route but struggle to find containers at good rates, we’ve got the perfect solution for you. On the Container xChange leasing platform, you can lease containers for one-way moves from 1,500+ vetted suppliers. Check out leasing offers on your preferred route now!
Latest developments in China Railway Express
The CRE celebrated its 10th anniversary in 2023 and over the past decade, the project has operated 77,000 freight trains – transporting goods valued at over $340 billion in 7.31 million TEUs.
To further increase efficiency, five routes on CRE now have trains operating on pre-scheduled timetables, with a total of 80 services launched.
In the first half of 2023, the maximum load capacity of a single China-Europe freight train was increased from 2,500 to 3,000 tonnes. Moreover, the variety of goods carried has also grown to over 50,000 types – with an emphasis on mechanical and electrical products, vehicles, and auto parts.
China State Railway Group Co noted that the number of China-Europe freight train trips rose 5% year-on-year to 10,575 in the first eight months of 2023.
However, despite these positive numbers, the CRE is not free from the various geopolitical challenges facing the world. Read on to find out more.
Challenges ahead in the CRE
One significant concern of CRE is its susceptibility to geopolitical risks. With its rail network passing through multiple countries, the CRE’s strength during peacetime becomes a potential vulnerability during times of political tension. Disputes between nations or trade partners can disrupt the smooth flow of goods, affecting the reliability of this crucial trade link.
Let’s take a detailed look at the challenges faced by CRE below.
Impact of the Red Sea attacks on CRE
Amidst the Chinese New Year and the Red Sea crises, Loadstar reported a remarkable 40% surge in inquiries for rail freight bookings in January 2024. The less-than-container load rail freight segment has witnessed a significant 30% increase in volumes in January compared to the previous year.
As a result, the current rail freight costs, hovering around $6,000-7,000, are near the heightened rates in ocean shipping, which stand at about $5,000. For SMEs in Asia and other developing regions, the train service from China to Europe remains a viable option to ship cargo amidst the Red Sea attacks.
However, the ongoing war in Ukraine introduces uncertainty regarding the uniform viability of rail services. Major EU and US customers face hurdles due to the enduring sanctions regime, which restricts their use of routings through Russia. Read on to find out more.
Impact of Russia-Ukraine war on China’s silk road project
The Russia-Ukraine war reshaped the dynamics of the China-Europe Railway Express. In response to the geopolitical risks associated with the northern rail route through Russia, the Middle Corridor gained prominence. Traders who were hesitant to send goods through Russia shifted their preference to the Middle Corridor, which bypassed Russia.
The Middle Corridor offers not only a safer route but also access to Mediterranean ports. This transition also holds significance for Ukraine’s post-war recovery, as the country can receive essential rail-dependent commodities from Central Asia and China without relying on Russia.
While the Middle Corridor presents a promising alternative, it may not fully replace the convenience of Russia’s rail network due to its complexity and additional border crossings. Nonetheless, it stands as a significant response to growing demand for secure trade routes.
Apart from the geopolitical challenges, the CRE also faces another major challenge, which is empty container repositioning. Read on to find out more.
Empty container repositioning: A widespread issue on CRE
Another major setback when it comes to transporting cargo from China to Europe is empty container repositioning.
The CRE is used predominantly for westbound Chinese exports, with empty trains often returning to China. There’s a huge difference in the westbound and eastbound volume: 80% of eastbound containers are empty, while 89% of westbound containers are fully loaded. This causes a disruption in the container flow.
Container imbalances of this nature can reduce your profit margins significantly when you’re transporting cargo on this route.
Consider this: A shoe company in China is exporting shoes from China to Europe. Once the goods arrive in Europe the cargo is discharged. The company then realizes that there isn’t enough cargo to import to China. This is when these empty containers pile up. Imports exceed exports leading to a surplus of containers in Europe. This means that China doesn’t have enough goods coming back — leading to a deficit of containers.
The cost of moving the empty containers to a different location makes empty container transport an expensive affair. So how do you move your rail freight without incurring empty repositioning costs? By leasing SOCs. Read on to find out more.
How much does it cost to lease SOCs?
A container is considered a Shipper-Owned Container when the Beneficial Cargo Owner (BCO), freight forwarder, or NVOCC organizes their own container. These containers offer more flexibility as compared to COCs. In multimodal transportation, you move your containers by rail and transport them via road to reach the final destination. Using SOC (Shipper Owned Containers) offers flexibility in this process.
Plus, you don’t have to worry about returning the containers. You simply lease containers for one-way journeys, e.g., from China to Europe. You get to move your cargo while the container owner gets to move their containers. It’s a win-win!
The pick-up rates on this stretch are also quite nominal. Have a look at the average pick-up rates from China to Europe for standard containers on our platform below:
- 20ft container pick-up charges from Shanghai to Aarhus is $620
- 40ft container pick-up charges from Shanghai to Rotterdam is $900
- 40ft HC container pick-up charge from Shenzhen to Irkutsk is $700
Want to explore the pick-up rates for SOC on your desired route? Simply use the xChange Insights tool for free to access container data in up to 180 global locations.
Now let’s take a look at how xChange can help you secure SOCs at the best rates easily.
Lease SOCs at best prices on Container xChange
If you’re planning to send your cargo across the China Europe Railway Express, you know you’ll need to lease SOCs from China to avoid the issue of repositioning. One easy way to do this is through the Container xChange leasing platform, where you can choose from 100,000 containers.
Our platform allows you to connect with 1,700 vetted container suppliers in 2,500+ locations globally. All you have to do is simply select your desired route. You can then choose from multiple SOC listings and negotiate directly with suppliers for better terms.
We also provide a public profile for all your members where you can check the ratings and make sure you’re only working with the best companies. And finally, you can make secure payments through the xChange wallet.
Here’s what Neptune Global Logistics, a rail and shipping freight forwarder in Shenzhen, China who avoided hefty empty repositioning has to say about xChange
“Since joining we’ve made 39+ reliable partner overseas and have successfully repositioned 1000s of our empty containers”
If you too have empty containers that need to be repositioned or if you’re looking for SOCs to move cargo, our team is here to help you on this journey. Click on the banner below to lease SOCs at best rates today!
China Europe Railway Express: Common FAQs
Is there rail freight between China and Europe?
Yes, the China Europe Railway Express is a network of rail services that connects cities in China with cities in Europe. It provides an overland transportation route for cargo.
How does China ship to Europe?
The traditional maritime route between China and Europe runs through the South China Sea, the Malacca Strait, the waters of the Indian Ocean and the Suez Canal. The China Europe Railway Express also connects both the continents through an extensive railway network.
How many routes are there on China Europe Railway Express?
The China-Europe Railway Express (CRE) operates along three major corridors: the eastern, central, and western routes. It has 73 routes connecting more than 50 cities in Mainland China with 217 cities in 25 European countries.
