EasyNetWorld

Demand and supply in transportation are the main determinants of commodity prices

economics

In economics, demand and supply are the main determinants of commodity prices.fcl freight In the dialectical relationship between the two, demand is the prerequisite and basis of supply, and supply changes as demand increases or decreases. When we introduce these two concepts into the transportation industry, we have transportation demand and transportation supply. These two concepts study the transportation industry from the perspective of market economy in order to rationally allocate transportation resources and pursue profit maximization.

The concept of transportation demand:

Transportation demand refers to a certain period of time the owner of goods or passengers to the transport supplier can carry out the realization of the requirements, and have the ability to pay for the development of the ability.fcl lcl Therefore, the transportation market demand should have two important conditions: both the desire and requirement to purchase transportation management services, and the ability to purchase behavior in China. Lack of which none of the economic conditions can not constitute the social reality of the transportation system demand.

(1) Transportation demand: also known as the flow, usually expressed in terms of freight and passenger traffic, used to describe the number and size of freight and passenger demand.

(2) Flow direction: refers to the spatial direction of the spatial displacement of goods or passengers, indicating the place where passenger and cargo flows are generated and consumed.

(3)Transportation distance: also known as the process, refers to the spatial displacement distance of goods or passengers from the starting point to the point of arrival.

(4) Transportation price: also known as freight, is the transportation cost of transporting a unit of weight or volume of goods or each passenger.sea freight The time from the starting point to the end point in the case of spatial displacement; the latter is the displacement distance per unit of time between the place of origin and the point of arrival in the case of spatial displacement of goods or passengers.

(5) Demand for transport development for structure: classification of transport market demand according to the type of goods in different countries, the purpose of travel for different passengers or the distance of transport for different enterprises.

Concept of transportation supply:

Transportation supply refers to the quantity and quality of transportation services that can be provided by a transportation supplier in a certain period of time. It is affected by a variety of factors such as the level of technological development, economic conditions, and policy environment. By providing adequate transportation supply, market demand can be met and economic development can be promoted.

(1) Transportation supply:It refers to the amount of goods transported and passengers transported that can be provided by a transportation supplier in a certain period of time.

(2) Supply system structure: refers to the proportion of supply of different types of enterprises to carry out the main purpose of goods and different passenger trips. For example, freight supply we can develop into bulk cargo transportation and small cargo transportation, etc.

(3) Quality of supply: refers to the performance of transportation services in terms of reliability, safety and timeliness. High quality supply can improve customer satisfaction and increase market competitiveness.

(4) Supply cost: refers to the cost required for the development of providing transportation management services, including the cost of human resources, the cost of equipment, the cost of fuel and so on. Reasonable cost control system can reduce the price by improving the efficiency of product supply.

(5) Supply Strategy: The supply plan and pricing strategy developed by the transportation provider in response to market demand and competition. Flexible supply strategy can adapt to market changes and increase market share.

The relationship between transportation demand and supply;

Transportation demand and supply are mutually influencing and constraining relationships. When demand increases, supply will increase to meet market demand; conversely, when demand decreases, supply will decrease to avoid excess. The balance between supply and demand is one of the determinants of market price. When supply exceeds demand, prices may fall; when demand exceeds supply, prices may rise. Therefore, it is important to understand and analyze the relationship between supply and demand in order to formulate a reasonable price strategy and resource allocation.

Summarize:

In the transportation industry, demand and supply are the major determinants of commodity prices. Transportation demand refers to the demand of cargo owners or passengers for transportation services, including elements such as demand volume, flow direction, transportation distance, price and demand structure; while transportation supply refers to the quantity and quality of transportation services that transportation suppliers can provide, including elements such as supply volume, supply structure, supply quality and supply strategy. The equilibrium state of supply and demand determines the formation of market price and the rationality of resource allocation. Therefore, when studying and analyzing the transportation industry, it is necessary to consider the factors of demand and supply in an integrated manner in order to achieve maximum profit and economic efficiency.