2024-07-11 23:11:48
In the past few months, ships belonging to Western companies have been attacked in the Red Sea by Houthi rebels who support Hamas in its war with Israel, driving up shipping costs.
Container prices, which peaked in January and briefly declined, have risen sharply in recent weeks.
One business told the BBC that the increased costs are likely to be passed on to the price of bulky goods such as household goods.
Nick Glynn, boss of Buy It Direct, runs a number of online retailers, including Appliances Direct and Laptops Direct, which have to plan their orders in advance to ensure their shipments arrive on time.
With the future in mind now, he said he doesn’t think Black Friday and the Christmas period will be affected.
But he said: “It affects cash and warehouse space as traders have to hold goods longer. Don’t take the risk and order later.”
Mr Glynn explained that the spot rate, the current price for spot delivery, had risen sharply in recent weeks from £4,500. up to 7.5 thousand US dollars (from 3.5 thousand to 5.9 thousand pounds sterling).
“It has a huge impact on bulky items, especially those with low margins such as furniture, barbecues and kitchen appliances,” he said.
According to him, most online sellers could not possibly adapt to such a price increase.
“So, unfortunately, consumers are going to see a significant increase in the prices of these more expensive items over the next few months,” he added.
The pandemic has taught
Disruption caused by Yemen’s Houthi movement has limited the global supply of shipping space and containers.
Houthi rebels have already launched attacks on more than 50 ships in the Red Sea and Gulf of Aden.
This has resulted in a significant increase in shipping costs. The average cost of transporting a 12-meter container now exceeds 4 thousand. US dollars, that is, 140 percent. more than in 2023, according to freight market tracker Xeneta.
Peter Sand, chief analyst at Xeneta, said importers had learned many lessons from the pandemic, including that “the simplest way to protect supply chains is to ship as much of your goods as quickly as possible.”
“That’s what we’re seeing when some companies are telling us they’re already shipping for the Christmas period, in May,” he said.
Typically, merchants start importing goods for the November Black Friday sales and the Christmas period from late summer to fall.
Sue Terpilowski of the Privileged Logistics and Transport Institute agreed, saying companies understand that disruption to the Red Sea route by Houthi attacks could last until the fall.
“To avoid the ‘Christmas cancelled, nothing in stores’ headlines, people are now actually bringing their shipments forward,” she said. “So they will be here in good time to anticipate any eventualities that may occur while they are at sea.”
Need extra 100 days
Attacks on ships have forced owners of ships traveling between Asia and Europe to take a longer route around Africa, with ships starting their journeys earlier to allow enough extra time to complete the detour.
“The effects of the diversions from the Red Sea that began last December are only now becoming apparent, with trade ships from Asia and Europe needing more than 100 days of rotation around Africa,” said Dominique Nadelhofer of Kuehne + Nagel, a major maritime logistics firm.
He added that the rotation of container equipment has also been disrupted, and said that only about 50 percent are currently being completed on time. of global container shipping.
In addition to concerns about possible future Houthi attacks, there are also growing fears that maritime patrols will be reduced as the navy focuses on fighting the Houthi rebels, which could provide opportunities for Somali pirates to step up their operations.
BBC parents.
2024-07-11 23:11:48