Exporters in a dilemma order book full but shipping them will be problem due to hike in container costs

2021-06-17 19:01:11 Shipping News

Chennai port is facing a huge shortage of containers forcing the exporters to pay through their nose to send their consignments either to United States or the Continent. There is demand supply gap triggered by the pandemic throughout the world and Chennai port is also facing the problem like any other port.

Container transportation costs have more than doubled to both United states and Continent

Industry sources said container transportation costs have more than doubled to both United states and Continent as this part of the world had successfully blunted the second wave of the pandemic and have resumed business in a big way.

The cost of transportation through containers from Chennai port to US which was around 2000 US dollars a few years ago (40 foot container) has shot up to 5000 US Dollars last year but has reached its peak at around 6500 US dollars at present. The cost of transporation to Europe has gone up by six fold in the last three years

Price hike for containers due to pandemic and crippled supply chain

The abnormal price hike for containers is due to the pandemic which had crippled the supply chain industry leading to congestion at various ports. Certain cargo need to be quarantined for a long time leading to delays in movement.

Talking to Sagar Sandesh Mr C R Raghavendra, Chairman of the Chennai and Ennore Ports Steamer agents association attributed the hike to severe demand and supply gap. The shortage of containers in the Chennai port region is around 25 per cent compared to the usual stocks.

The industry is working round the clock with customs to get the containers struck at Customs released at the earliest. About 10,000 containers are held up with various agencies including the customs on issues he said

With pandemic decline container availability and prices expected to stabilize

He however expressed confidence that now with the pandemic tapering off even in our country, the container availability and prices  are expected to stabilize in the next three to four months

Exports from India are picking up during the last few months with the US market opening up after the Trump's regime protectionist era and European market recovering after corona pandemic being contained industry source said

The sources however felt the container problem in Chennai port is expected to continue till the end of the year 2021. With exporters order book getting filled up they are concerned about the logistics issues as the freight markets remained hot

Other Shipping News