Freight Rates Face A Massive Spike As Container Crisis And Port Congestion Goes From Bad To Worse
Freight rates have quadrupled since lockdowns started to be implemented all over the world at the beginning of the health crisis in March 2020. That has pushed retail prices to unprecedented levels, affecting businesses that were facing mass shutdowns and store closures, and consumers who were struggling with income losses and higher prices. A series of determinants, such as an extraordinary rise in consumer demand, a historic shortage of containers, port congestion, and a decreased number of ships and dock workers, have all contributed to the worsening of the shipping crisis on almost all trade routes. Now, a new virus outbreak in Asian countries particularly in India and China is also compounding concerns on global trade. Given that over 85 percent of the goods trade is transported by sea, soaring freight rates are sending the price of everything to skyhighs, from toys to building materials to furniture to auto parts and components of all types of goods, and even food, including tea and coffee, adding
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