{"id":9145,"date":"2023-02-03T23:36:03","date_gmt":"2023-02-03T23:36:03","guid":{"rendered":"https:\/\/asia-ibs.com\/v2\/rising-costs-in-maritime-freight-transportation\/"},"modified":"2023-02-03T23:36:03","modified_gmt":"2023-02-03T23:36:03","slug":"rising-costs-in-maritime-freight-transportation","status":"publish","type":"post","link":"https:\/\/asia-ibs.com\/en\/rising-costs-in-maritime-freight-transportation\/","title":{"rendered":"Rising Costs in Maritime Freight Transportation"},"content":{"rendered":"\n<p class=\"wp-block-paragraph\">The pandemic, the war, and the downturn in international trade disrupted the maritime cycle in terms of freight rates<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>Bottlenecks in supply chains<\/strong>&nbsp;were also generated by greater port congestion, limited port availability, and the high concentration of the shipping industry.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Several additional factors<a href=\"https:\/\/thelogisticsworld.com\/logistica-y-distribucion\/incremento-de-costos-en-el-transporte-maritimo-de-mercancias\/\" target=\"_blank\" rel=\"noreferrer noopener\"><em>&nbsp;contributed to rising costs in maritime transportation<\/em><\/a>.<\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>The&nbsp;<em>disruptions in maritime supply chains<\/em>&nbsp;began in 2020 due to events such as the pandemic and the&nbsp;<a href=\"https:\/\/thelogisticsworld.com\/logistica-y-distribucion\/aumento-en-los-costos-de-transporte-logistico-una-consecuencia-mas-del-conflicto-entre-rusia-y-ucrania\/\" target=\"_blank\" rel=\"noreferrer noopener\">Russia-Ukraine War<\/a>;&nbsp;<strong>80% of global trade volume moves by sea.<\/strong><\/li><\/ul>\n\n\n\n<p class=\"wp-block-paragraph\">According to the document International Trade Outlook for Latin America and the Caribbean 2022, prepared by the Economic Commission for Latin America and the Caribbean (ECLAC), the main consequences included:<\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>Shortage of imported final goods for consumption.<\/li><li><strong>Shortage of imported inputs<\/strong> and capital goods for production.<\/li><li>Disruptions to the balance of <em>logistics markets<\/em>.<\/li><li>Loss of <strong>shipment reliability<\/strong>.<\/li><li>Delays, congestion, and the <strong>inability to plan the logistics chain<\/strong>.<\/li><li>Higher <a rel=\"noreferrer noopener\" href=\"https:\/\/thelogisticsworld.com\/actualidad-logistica\/aumento-de-costos-por-problemas-en-la-cadena-de-suministro-son-asumidos-por-las-empresas\/\" target=\"_blank\"><em>inflation due to increased transportation costs<\/em><\/a>.<\/li><\/ul>\n\n\n\n<p class=\"wp-block-paragraph\">FEATURED ARTICLE: Reverse logistics: achieve strategic management of your returns<a href=\"https:\/\/thelogisticsworld.com\/logistica-y-distribucion\/logistica-inversa-logra-una-gestion-estrategica-para-tus-devoluciones\/?utm_source=Modulo_Articulos&amp;utm_medium=Boton_Banner&amp;utm_campaign=Logistica_inversa\" target=\"_blank\" rel=\"noreferrer noopener\">READ ARTICLE<\/a><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The United Nations Conference on Trade and Development (UNCTAD, 2021) estimated that if&nbsp;<strong>freight rates<\/strong>&nbsp;remained at their August 2022 levels through the end of 2023, <em>consumer prices would rise 1.5% and import prices 10.6%<\/em>.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">\u201cThe impact of rising costs increases gradually until reaching its&nbsp;<strong>peak in month 12, reversing six months<\/strong>&nbsp;later,\u201d the ECLAC document states.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>You may be interested in:&nbsp;<a href=\"https:\/\/thelogisticsworld.com\/transporte\/aumentos-de-la-canasta-basica-del-autotransporte\/\" target=\"_blank\" rel=\"noreferrer noopener\">CANACAR warns of rising supply costs in its Economic Agenda for Freight Trucking<\/a><\/strong><\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Lack of Reliability in Vessel Arrivals<\/strong><\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">An additional factor affecting the <em>distribution of goods<\/em>&nbsp;worldwide was the lack of certainty about the&nbsp;<strong>punctuality of vessel arrivals<\/strong>.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Indeed, the&nbsp;<a href=\"https:\/\/thelogisticsworld.com\/planeacion-estrategica\/por-que-la-guerra-rusia-ucrania-intensifica-la-escasez-de-productos\/\" target=\"_blank\" rel=\"noreferrer noopener\">Russia-Ukraine War made areas of the Black Sea and the Sea of Azov<\/a>&nbsp;dangerous due to missile attacks, as well as the detention of vessels.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">On top of this, there was&nbsp;<a href=\"https:\/\/thelogisticsworld.com\/comercio-internacional\/miles-de-contenedores-atascados-en-roterdam-rusia-es-su-destino\/\" target=\"_blank\" rel=\"noreferrer noopener\">vessel congestion<\/a>&nbsp;with longer shipping and receiving times for goods, as well as&nbsp;<em>labor shortages at ports<\/em>&nbsp;and a scarcity of ground transportation in Europe.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Congestion at ports on the&nbsp;<strong>U.S. East Coast ranged from 5 to 21 days<\/strong>&nbsp;in 2022, and from&nbsp;<strong>5 to 12 days on the West Coast<\/strong>.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">In 2022, China&#8217;s \u201cZero Covid\u201d policy contributed to a new imbalance with the&nbsp;<a href=\"https:\/\/thelogisticsworld.com\/logistica-y-distribucion\/confinamientos-en-shanghai-tendran-consecuencias-en-la-logistica-internacional\/\" target=\"_blank\" rel=\"noreferrer noopener\">two-month lockdown in Shanghai<\/a>&nbsp;during April and May.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>Learn more:&nbsp;<a href=\"https:\/\/thelogisticsworld.com\/actualidad-logistica\/reabren-el-puerto-de-shanghai-fin-de-la-crisis-de-contenedores\/\" target=\"_blank\" rel=\"noreferrer noopener\">The Port of Shanghai reopens. Will it be the end of the container crisis?<\/a><\/strong><\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Rising Maritime Transportation Costs<\/strong><\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">The document detailed an&nbsp;<strong>increase in the price of the fuel<\/strong>&nbsp;used in maritime transportation due to the Russia-Ukraine war.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">\u201cPrices for&nbsp;<em>very low sulfur fuel oil<\/em>&nbsp;and intermediate fuel oil (380) went from 669 dollars and 526 dollars per metric ton, respectively, in&nbsp;<em>January 2022, to 1,016 dollars<\/em>&nbsp;and 749 dollars per metric ton, respectively, just days after the start of the conflict.\u201d<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">As for the&nbsp;<a href=\"https:\/\/thelogisticsworld.com\/logistica-y-distribucion\/aumento-en-los-costos-de-transporte-logistico-una-consecuencia-mas-del-conflicto-entre-rusia-y-ucrania\/\" target=\"_blank\" rel=\"noreferrer noopener\"><strong>transportation cost<\/strong><\/a>&nbsp;of exports to the United States, it grew steadily: the value in&nbsp;<em>June 2022 was four times higher<\/em>&nbsp;than in January 2019.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">In the case of imports from Asia, in 2022 it was 4.3 times higher than in January 2019.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>Find out more:&nbsp;<a href=\"https:\/\/thelogisticsworld.com\/planeacion-estrategica\/como-deben-preparase-las-empresas-ante-la-inflacion-y-aumento-de-tasas\/\" target=\"_blank\" rel=\"noreferrer noopener\">Inflation and rising rates: how should companies prepare?<\/a><\/strong><\/p>\n\n\n\n<h3 class=\"wp-block-heading\">What Is the Maritime Cycle?<\/h3>\n\n\n\n<p class=\"wp-block-paragraph\">The ECLAC report explains that \u201cthe&nbsp;<strong>demand for transportation<\/strong>&nbsp;is linked to the economic cycle or general business cycle. That demand, and its relationship to supply and&nbsp;<em>its effects on the final price<\/em>&nbsp;(the freight rate), is closely tied to the so-called maritime cycle.\u201d<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The maritime cycle is a temporal sequence of adjustments seeking balance between the supply of and demand for&nbsp;<a href=\"https:\/\/thelogisticsworld.com\/actualidad-logistica\/fletes-maritimos-del-canal-de-suez-subiran-en-2023\/\" target=\"_blank\" rel=\"noreferrer noopener\"><strong>maritime services<\/strong><\/a>.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">For a time, the price sits above equilibrium, which causes the quantity in the following period to be above equilibrium.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">This causes the <em>cost to fall below the equilibrium level<\/em>: \u201cfleet expansion (shipping capacity) will halt and, when facing exogenous demand growth, the delayed reaction of supply will push the price above the equilibrium level, and so on.\u201d<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Source: <a href=\"https:\/\/thelogisticsworld.com\/logistica-y-distribucion\/incremento-de-costos-en-el-transporte-maritimo-de-mercancias\/\">The Logistics World<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>The pandemic, the war, and the downturn in international trade disrupted the maritime cycle in terms of freight rates Bottlenecks in supply chains&nbsp;were also generated by greater port congestion, limited port availability, and the high concentration of the shipping industry. Several additional factors&nbsp;contributed to rising costs in maritime transportation. The&nbsp;disruptions in maritime supply chains&nbsp;began in [&hellip;]<\/p>\n","protected":false},"author":5,"featured_media":8551,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"inline_featured_image":false,"footnotes":""},"categories":[50,52],"tags":[],"class_list":["post-9145","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-economia","category-empresas"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v28.6 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Rising Costs in Maritime Freight Transportation - ASIA IBS<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/asia-ibs.com\/en\/rising-costs-in-maritime-freight-transportation\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Rising Costs in Maritime Freight Transportation - ASIA IBS\" \/>\n<meta property=\"og:description\" content=\"The pandemic, the war, and the downturn in international trade disrupted the maritime cycle in terms of freight rates Bottlenecks in supply chains&nbsp;were also generated by greater port congestion, limited port availability, and the high concentration of the shipping industry. Several additional factors&nbsp;contributed to rising costs in maritime transportation. 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