CR Express tackles the issue of empty containers

China's state-owned railway operator said on Wednesday that the container utilization rate of China Railway Express (CR Express), or freight trains shuttling between China and Europe, has been increasing significantly over the past two years as the country put an emphasis on high-quality development.

The proportion of loaded containers to all the containers transported has seen a marked improvement in 2018 and the first half of this year, China Railway Corporation (CRC), the country's top railway operator, told the Global Times in an exclusive interview on Wednesday.

In 2018, the ratio for outbound trips was 94 percent while that for returning trips was 71 percent. During the first half of this year, the ratio for outbound trips improved further to 98 percent with an 82 percent ratio for returning trips, according to data provided to the Global Times in a statement.

"Seen from a perspective of development, the ratios for loaded containers have been steadily improving," the CRC said.

The CRC's comments came after reports of outrageously low container utilization rates by some news outlets in China. A low utilization rate means freight trains are carrying nearly empty containers.

In some extreme cases, an entire train carrying 41 containers could have as many as 40 empty containers, according to media reports.

Without directly refuting the report, the CRC said the issue of empty containers has indeed existed for some time as the CR Express service matured.

The CR Express is also known as the "Belt and Road on rail," and by the end of June, the CR Express rail had connected 53 European cities across 16 European countries, with more than 16,000 cargo trains on the network transporting vehicles, laptops, food items, garments, and small commodities.

When localities were competing for hub status years ago, the issue of empty containers was serious. However, as the service has grown in scale, and industry players learned to discipline themselves and the concept of high-quality development took root, the phenomenon has become a thing of the past, the CRC said.

In the first half of 2019, seven key localities from Chongqing Municipality in Southwest China to Yiwu in East China's Zhejiang Province reported a loaded container ratio of over 94 percent for outbound trips. These localities handled about 73 percent of all the China-Europe cargo trains.

The CRC said there are other reasons, including route testing, structural imbalance between China and EU trade, and the market-driven relocation of empty containers, which are themselves a resource, causing empty containers to be loaded on CR Express trains.

In the first half of 2018, China needed Russian timber and Russia had no containers in Siberia, so a large number of trains carried empty containers to the region. Such a situation has ceased to exist, the CRC statement said.

To ensure high-quality growth and optimized use of rail transportation capacity, the CRC said it has since 2018 placed restrictive measures on the ratio of empty containers but has also given due consideration for the specific situation such as the return of refrigerated containers.

For outbound trips, the CRC stipulated that empty containers cannot exceed 10 percent of the total freight.

These measures, along with a maturing European market that has begun to generate more cargo bound for China, have caused the inbound loaded container ratio to improve to 82 percent from 2018's 71 percent.

Chen Fengying, a research fellow at the China Institutes of Contemporary International Relations, told the Global Times that the factor CR Express should give priority to is efficiency at the current development stage.

"We must beware of resources being abused by localities or local officials trying to score political points and focus on the economic basics of this innovative service, which is doing great good for China and the world," Chen said.