Bangkok Terminal Logistics Co., Ltd.
Revealing the trend of shipping rates from late 2020 to early next year 2021
Tracking shipping rates is therefore important for importers and exporters to know trends in transportation costs or expenses.
Freight Rate Trends
Maritime transport has long been an important component of the international trade system and will continue to be an important part of the future as it is one of the lowest cost transport categories.
It can also transport a larger volume of goods than other types of transportation. Therefore, tracking shipping rates is important for importers and exporters to know the trends in transportation costs and make future predictions.
Factors affecting freight rates include route factors or transportation distance, fuel costs, and international exchange rates that fluctuate. All three of these factors have a direct impact on freight rates.
In addition, there are many external factors, such as the recent outbreak of Covid-19, which has slowed down transportation, reduced freight, and increased transportation costs, which has resulted in higher product costs per unit.
And the latest event that just happened is the US presidential election, with Joe Biden as the new leader, which will have an impact on trade policy, which may be more relaxed.
Or even the factor of import and export regulations of each country, which still needs to be watched. Drewry, an independent consultant and researcher for the maritime industry, has revealed data on the current freight rate (Spot Rate) of the Trans-Pacific route that has adjusted significantly from the impact of Covid-19, breaking the record of 40% more than the highest freight rate.
This incident is an event that is beyond the normal price mechanism of supply and demand. In addition, exports to the United States are expanding significantly, resulting in a shortage of containers.
Lessons from Covid-19 have led shipping companies to adapt by grouping their businesses together, sharing cargo space on the same ship to prevent excessively high freight rates.
In addition to helping users get services at affordable prices, it also reduces the burden that service providers have to bear in terms of transportation costs. However, due to the problem of importing goods from China, which is the main market, decreasing to the point of almost stopping, resulting in a shortage of export containers.
Exporters therefore have to import empty containers for export, which increases costs from unprofitable expenses.
This incident is another factor that inevitably causes freight rates to increase at the end of this year until the beginning of next year.
However, if in the latter part of the first quarter of 2021, the Covid-19 outbreak factor does not return (resulting in the freight trade returning to normal), the freight rates will definitely decrease to normal.
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