It has rarely been more expensive to move sugar, coffee and copper around the world by sea.
Ocean freight rates began to soar last summer, and haven’t let up. That is partly because consumers, unable to spend money in restaurants, have splashed out on goods that move by sea. Retailers and manufacturers, meanwhile, have rushed to rebuild inventories.
The shortage of 40-foot steel shipping containers has snarled global supply chains for commodities, hiking prices for some raw materials. That is of interest to investors and economists, who have been on the watch for signs of inflation after governments and central banks flooded markets with cash to bolster the pandemic-hit global economy. So far, there hasn’t been a big increase in consumer prices.
Trading houses, though, are feeling the pinch. Firms such as U.K.-based metals merchant RJH Trading Ltd. are paying lofty rates to secure berths on vessels. They face delays before loading cargoes at ports in Asia, where the dearth of boxes is most acute.
Normally, it takes RJH between 30 and 40 days to get tin and antimony, a silvery metal used in the electronics industry, from Asia to Europe, said managing director Charles Swindon. In recent months, RJH has waited for several weeks to find containers at ports in China, lengthening the journey time to 70 days. Freight costs are three to four times higher, he said.
