Global shipping costs are starting to trend downwards, nonetheless prices remain elevated considerably above pre-pandemic levels. Indeed, there is an approximate 50% reduction being experienced by Caribbean importers.
According to Richard Pandohie, former President of the Jamaica Manufacturers & Exporters Association, the cost for shipping a 40ft container now ranges between US$10,000 and US$12,000, “still above pre-pandemic level of US$4-5k but also way below the US$18 -$20k peak of last year.” “The situation is highly volatile, so it’s hard to say how long it will last but it certainly depends on the extent of COVID spread and lockdown in China,” he added.
Pandohie further explained that the lockdowns in Shanghai have resulted in the decline in manufacturing and, by extension, defused a “bidding war” for cargo space on vessels that contributed the rising cost of freight. According to the Drewry’s composite World Container Index of April 7, freight costs for a 40ft container (Shanghai – US) decreased by 1.4% to US$8,041.50, 64% higher than a year ago. (JO)
Extract from the CARICOM BUSINESS Newsletter Vol 5 No 18