Thailand’s exports grew in the first quarter, but transportation costs soared.

Exports, transportation costs soar

The continuing problem of skyrocketing shipping and freight costs and container shortages continue to be a barrier to exports.

Despite the good news in the first quarter from the report last week that exports expanded by more than 4.78%, in the end, it encountered cost obstacles. The shipping cost has been continuously increasing. When combined with the cost of goods, it has caused the overall cost of goods to increase. Therefore, importers cannot bear this continuous high cost. In particular, agricultural and food products have been affected the most. As a result, exporters have had to postpone the delivery of goods from importers abroad.

Summary of the rising cost crisis

1. Shipping rates have increased by 100-200%, and in some routes, by as much as 300%.
2. The persistent shortage of containers, meanwhile, has allowed several large ships measuring 400 meters to dock at Laem Chabang with empty containers.
3. The cost of cans has increased in the production of canned seafood due to the problem of production costs of products from steel sheets used to produce cans, accounting for 40-50% of the product cost in the processed food production industry.
4. Slowing down the stockpiling of some raw materials during Covid-19 When production for export returns to normal, raw materials such as electronic chips, steel, rubber, plastic, cotton, polyester, have higher costs due to shortages.
5. Labor shortage due to Covid-19 outbreak

Although overall exports continue to expand well, the government still needs to urgently find solutions to keep exports moving in a better direction, as exports are currently an important engine driving the country’s economy while facing the Covid-19 crisis.

Source: prachachat.net