Ocean freight price soars into ‘logistic chaos’ and threatens industry

Covid-19 pandemic impacts have reached all layers of society and the global economy. One of the greatest impacts is the cost of sea freight, the most common form of international trade among countries.

In the last 13 months, with the continuous reopening of activities and the global economic recovery, the number of orders for inputs and goods in foreign trade soared, higher than the logistical capacity of shipowners and port terminals, making maritime freight more expensive.

Bottlenecks in the input chain in the production of products, with demand returning faster than supply, in addition to the concentration of the largest players in this market are some of the reasons that explain this phenomenon.

Shipping a 40-foot container from China cost $1,500 before the pandemic. About 30 days ago, the cost was $10,500. Last week, the price reached US$15,800.

According to estimates by CNI (the Brazilian national confederation of industry), the escalation of freight prices for different routes should remain in effect in the coming months. Brazil even finds itself in a vulnerable position in this context.

According to Rafael Dantas, commercial director of Asia Shipping, the price situation of containers can be explained by a number of factors which have been accumulating over the last year and a half. “The shipping price of US$15,800 was not hit overnight. This process began last year, when importers resumed purchases after the height of the pandemic abroad.”

According to the expert, one of the main factors is, in fact, the consolidation of the segment. “The four largest shipowners in the sector hold almost 60% of the global market share. This trend should continue to happen”, says Dantas.

Source: Suno News

To read the full original article, visit the link:

https://www.suno.com.br/noticias/preco-frete-maritimo-logistica-comercio/

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