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Freight rates continue to rise

Effects of shipping congestion on Latin American trade varied

At this point in time, the global supply chain is facing several challenges to be able to fulfil the service of transport of cargo and raw materials, in different maritime routes. It is unfortunately the season of high demand, which includes the months of July, August and September.

Container shortages are one of these challenges, but there is also a delay of up to six weeks in confirming bookings at shipping companies. It is estimated that approximately 20 million containers circulate in the world, moving through ships between different ports daily. But right now, there is an imbalance in the availability to move goods from Asia.

In addition to the lack of containers, the supply chain faces other challenges caused by Covid-19 infections among workers  at some ports in Asia, such as Yantian, which last month led to the partial closure of operations, causing delays, congestion  and rising freight rates.

The $4,000 fee that was regularly paid to bring a container from Asia to Panama skyrocketed to $10,000 last  week and, in recent days, already reaches $15,000, Urrutia added. On routes between Asia and Europe, the fare is $20,000 or more, per container.

In the last weeks of June, some ships were not arriving at the port of Yantian. The supply chain was already affected by  the jam caused by the Ever Given ship in the Suez Canal, which blocked that passage for six days.

Fpcfreshtalkdaily.co.uk reports how the effect in Latin America has been greater now, because much of the cargo from Asia is destined for the countries of the region. On the other hand, when the congestion occurred in Suez, the effects were less because that sea route is used more by European countries.


Photo source: Dreamstime.com

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