High international freight costs drive early cargo shipments amid Red Sea attacks
Date
5/29/2024 3:47:58 AM
(MENAFN) With international shipping costs soaring, companies are accelerating their plans to ship holiday goods earlier than usual, reflecting the far-reaching impacts of the ongoing attacks in the Red Sea. The average cost of shipping a 40-foot container between the Far East and Northern Europe, particularly on short notice, has surged to USD4,343 per container last week, nearly three times higher than the same period last year, according to data from shipping market tracking company Zenita.
While prices have yet to surpass the peak levels recorded immediately after the onset of attacks in November, they remain significantly elevated during what is typically considered a quieter period for shipping in the spring months. Traditionally, the peak shipping season occurs in late summer and early fall, as retailers import merchandise to stock up for Black Friday sales in November and the ensuing pre-Christmas shopping season. However, industry experts note that the peak season has shifted earlier this year, prompting companies to adjust their shipping schedules accordingly.
Michael Aldwell, president of marine logistics at Coney + Nagle, one of the leading ship brokers setting shipping rates for retailers, remarked on the shift in peak shipping periods. He highlighted the need for retailers to adapt to the changing dynamics of the shipping industry, driven in part by the disruptions caused by the attacks in the Red Sea.
Industry insiders attribute the rebound in shipping costs to various factors, largely stemming from the impacts of the attacks in the Red Sea. These attacks have constrained the global supply of shipping space and containers, forcing shipowners operating routes between Asia and Europe to navigate longer routes around the African continent. As a result, shipping capacity has become constrained, leading to a surge in shipping costs and prompting companies to expedite their holiday goods shipments to mitigate potential delays and disruptions.
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