The logistics operation in our country is showing a trend of stabilization and improvement, providing important support for the smooth economic circulation industry | Logistics | Improvement

Transportation and logistics are connected to production at one end and consumption at the other, which is an important foundation for maintaining the normal production and living order of the people, promoting the stability of the industrial and supply chains, and serving economic and social development.

In the first half of 2023, with the comprehensive restoration of normal operation of the social economy, the overall logistics demand in China showed a mild recovery. In the second quarter, upstream production and sales have slightly recovered, social destocking has continued to optimize, logistics service supply capacity has improved, and the circulation of various links in the supply chain has gradually become smooth. Social logistics costs have steadily decreased, providing strong support for promoting economic recovery and improvement.

Logistics operation is showing a trend of stabilization and improvement

In the first half of the year, the total amount of social logistics in China exceeded 160 trillion yuan

According to data released by the China Federation of Logistics and Purchasing, in the first half of the year, the total social logistics volume in China was 160.6 trillion yuan, with a year-on-year increase of 4.8% based on comparable prices, an increase of 0.3 percentage points from January to May, and a month on month increase of 1.6 percentage points in the second quarter. Overall, the cumulative growth of logistics demand within the year has shown a rebound trend.

"Overall, the upstream and downstream of the supply chain are returning to a normalized operation track, and the overall logistics operation is in a stable and improving development state." The relevant person in charge of the China Federation of Logistics and Purchasing stated that from the perspective of logistics demand structure, the growth rate of industrial and agricultural product logistics is generally stable, providing strong support for the recovery of the total logistics volume in society; Consumer logistics for people's livelihood has achieved rapid growth, and its driving force on the total growth of social logistics has significantly increased. Compared with the same period last year, the contribution rate of logistics in areas such as people's livelihood consumption, imports, and renewable resources has increased, with a total contribution rate of nearly 30%, driving a 1.4 percentage point increase in the total amount of social logistics.

The person in charge stated that from different fields, the trend of structural differentiation in the logistics industry is evident, mainly presenting the following characteristics:

The industrial sector has optimized its structure, and there is a clear driving force for upgrading logistics demand. In the first half of the year, industrial production continued to recover, and the total amount of industrial product logistics increased by 3.8% year-on-year, accelerating by 0.2 and 0.8 percentage points respectively compared to the previous May and the first quarter. From a monthly perspective, the cumulative year-on-year growth of each month in the second quarter was 3.6%, 3.6%, and 3.8% respectively, showing an overall rebound trend. Among them, over 60% of the total logistics volume in the industry achieved growth, indicating a relatively stable overall trend of industrial logistics recovery.

The recovery of people's livelihood consumption logistics is relatively fast, and multiple scenarios and fields are synchronously improving. In the first half of the year, the total logistics volume of goods between units and residents increased by 10.0% year-on-year, an increase of 4.1 percentage points compared to the first quarter. Online and offline consumer logistics have rebounded simultaneously, and the online retail sales of physical goods in China have increased by 10.8% year-on-year, an increase of 3.5 percentage points compared to the first quarter. In the first half of the year, the express delivery business volume exceeded 60 billion pieces, and consumer logistics in key areas such as rural e-commerce continued to rebound.

The growth resilience of imported goods flow is strong, and the structure shows differentiation. The total import logistics volume in the first half of the year was 8.6 trillion yuan, with a year-on-year increase of 13.8% based on comparable prices, an increase of 1.9 percentage points compared to the first quarter. The overall scale of imported physical logistics in our country has remained stable with an increase, demonstrating strong resilience.

Policies related to ensuring smooth traffic and reducing costs are gradually becoming effective

Logistics operating costs are steadily decreasing

In the first half of the year, with the steady recovery of upstream demand and the synchronous increase and improvement of logistics supply, coupled with the introduction of logistics policies by multiple departments to ensure smooth flow and reduce costs, the economic circulation has improved, and the overall logistics operating costs have fallen.

In the first half of the year, the total social logistics cost in China was 8.6 trillion yuan, a year-on-year increase of 3.7%, which was lower than the growth level of the total social logistics and GDP during the same period. The ratio of total social logistics costs to GDP is 14.5%, a decrease of 0.1 and 0.3 percentage points compared to the first quarter of this year and the first half of 2022.

Analysis shows that China's economic growth has entered a period of power transformation, and logistics operations have also undergone synchronous transformation. The economic growth has shifted from being mainly driven by industry last year to being jointly driven by the service industry and industry, resulting in a decrease in the physical turnover of logistics per unit of GDP. At the same time, the proportion of equipment and high-end manufacturing logistics continues to increase, and the supporting industries and product supply chains are gradually shifting towards lean integrated logistics. The collaborative ability of industrial organizations and supply chain resilience have improved, and the collaborative ability of industrial organizations and supply chain resilience have improved. The logistics operation efficiency is relatively good, and unit costs continue to decline.

From the perspective of changes in the composition of total social logistics costs, the proportion of transportation costs increased by 0.6 percentage points compared to the same period last year, storage costs decreased by 0.5 percentage points, and management costs decreased by 0.1 percentage points. This means that the current logistics operation is gradually shifting from static to dynamic, and the economic cycles of production, circulation, and consumption are gradually becoming smooth.

From upstream data, it can be seen that inventory of industrial enterprises above designated size has continued to decline since the end of April 2022. As of the end of May, the growth rate of inventory has decreased to 0.8%. Considering the relatively weak recovery of industrial operating income, production has not shown significant expansion and inventory growth has slowed down, indicating that most industrial enterprises may enter the stage of destocking.

From the logistics data, both the Logistics Industry Prosperity Index and the China Warehousing Index show an accelerated turnover speed in logistics warehousing, with inventory levels continuing to decline. The inventory turnover efficiency index reflected in both indices has remained in the expansion range since the second quarter, and has continued to rebound compared to the previous quarter. At the same time, both the average and ending inventory indices are below 50%, with a continuous decline compared to the previous period.

The person in charge stated that overall, the economic cycle tends to improve, and the efficiency of warehousing turnover has increased. However, industry differentiation still exists. In the consumption and upgrading sectors, circulation turnover accelerates, and inventory levels are relatively low. In some traditional manufacturing sectors, inventory levels are still high.

Accelerated investment in logistics infrastructure in key areas

Providing important support for the smooth circulation of the real economy

In the first half of the year, the total revenue of China's logistics industry reached 6.3 trillion yuan, a year-on-year increase of 5.3%, still maintaining stable and rapid growth. The person in charge stated that as logistics demand gradually recovers, the supply of logistics services continues to increase. At the same time, with the upgrading of industrial structure and the expansion of consumer sectors, the logistics supply structure is optimized and adjusted.

From a structural perspective, the combined contribution rate of transportation and express logistics revenue exceeds 80%, effectively ensuring the dynamic operation of upstream and downstream logistics. From the perspective of industry prosperity, the industry as a whole is in a relatively high prosperity range, with an average logistics industry prosperity index of 51.2% in the first half of the year, significantly higher than the same period last year. The average in the second quarter exceeded 52%, an increase of 2 percentage points from the first quarter. The overall activity of logistics business is relatively active, and the industry has a good level of prosperity.

From the perspective of key enterprises, the operating scale of logistics enterprises maintains a rapid recovery growth. In the first half of the year, the growth rate of logistics business revenue for key logistics enterprises was 10.0%, maintaining a relatively fast growth rate throughout the year. Among them, the growth rate of revenue from supply chain and express logistics business exceeded 18%, both higher than the average level of key enterprises. Business recovery in areas such as supply chain integration and people's livelihood consumption was relatively fast, indicating that the development of logistics enterprise business is basically synchronized with the recovery of upstream demand.

In the first half of the year, the logistics infrastructure network operated smoothly, and the investment momentum in key areas of infrastructure was good. According to data from the National Bureau of Statistics, infrastructure investment in the first half of the year increased by 7.2% year-on-year, with investment in railway transportation industry increasing by 20.5% and investment in water management industry increasing by 9.6%. In the first half of the year, 91 infrastructure investment projects were approved by the National Development and Reform Commission, with a total investment of over 70 billion yuan, mainly focused on energy, high-tech, transportation and logistics industries.

In addition, the Ministry of Transport has organized multiple pilot projects around key areas and key links. The pilot projects of "Smart Port Construction" in Shandong and "High quality Development of" Four Good Rural Roads "in Jiangsu have achieved good results and played a demonstrative and driving role. Focusing on addressing the shortcomings, multiple departments such as the Ministry of Commerce and the National Postal Administration have made efforts to promote the construction of a three-level logistics and distribution system in counties and villages, strengthen the construction of rural logistics infrastructure, build county-level public distribution centers for postal logistics, and village level comprehensive service stations for postal logistics. In the first half of the year, the number of express deliveries in rural areas of China has exceeded 20 billion, an increase of over 30% compared to the same period last year. Overall, the continuous acceleration of infrastructure construction in multiple fields of logistics has provided important support for the smooth circulation of the real economy.

"From the perspective of the whole year, there are still many favorable conditions to support the stable recovery of logistics, and logistics demand is expected to continue to expand." The person in charge said that with the further measures proposed by the country in the second half of the year to expand domestic demand, boost the fields of automobiles, electronic products, home furnishings, etc., rectify overcharging, encourage and promote the development of private economy, build a modern industrial system, strengthen people's livelihood security, and clarify the development direction of a series of development directions. At the same time, combined with the huge potential and good resilience of the logistics industry, the long-term positive trend of social logistics demand will be more obvious.