In its Review of Maritime Transport for 2021, United Nations Conference on Trade and Development (UNCTAD) said that the current surge in container freight rates, if sustained, could increase global import price levels by 11% and consumer price levels by 1.5% between now and 2023.
1#.Due to strong demand, as well as equipment and container shortages, reduced service reliability, port congestion, and prolonged delays, uncertainties in supply continue to increase, and ocean freight rates are expected to remain high.
2#.If the current surge in container freight rates continues, from now to 2023, the global import price level may rise by 11%, and the consumer price level may rise by 1.5%.
3#.By country, as shipping costs soar, the US consumer price index will rise by 1.2%, and China will rise by 1.4%. For small countries that rely heavily on imports to meet most consumer needs, they may become the biggest victims in the process, and their prices may rise by as much as 7.5%.
4#.Due to supply chain distribution, the prices of electronic products, furniture and clothing have risen the most, with a global increase of at least 10%.
The impact of the high freight charges will be greater in small island developing states (SIDS), which could see import prices increase by 24% and consumer prices by 7.5%. In least developed countries (LDCs), consumer price levels could increase by 2.2%.
By the end of 2020, freight rates had surged to unexpected levels. This was reflected in the Shanghai Containerized Freight Index (SCFI) spot rate.
For example, SCFI spot rate on the Shanghai-Europe route was less than $1,000 per TEU in June 2020, jumped to about $4,000 per TEU by the end of 2020, and rose to $7,552 per TEU by the end of November 2021.
Furthermore, freight rates are expected to remain high due to continued strong demand combined with supply uncertainty and concerns about the efficiency of transport and ports.
According to the latest report from Sea-Intelligence, a Copenhagen-based maritime data and advisory company, ocean freight may take more than two years to return to normal levels.
UNCTAD’s analysis shows that higher freight rates have a greater impact on the consumer prices of some goods than others, notably those which are more highly integrated into global supply chains, such as computers, and electronic and optical products.
Post time: Nov-30-2021
