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Freight Costs May Be Rising Again

Views: 0     Author: New Shine Lighting     Publish Time: 2023-09-22      Origin: Site

Freight Costs May Be Rising Again


The bad times that caused freight costs to rise during the pandemic are behind us, but some new factors may begin to push freight costs up again in the near future:


Labor


UPS reached a labor settlement with workers that is expected to result in about $30 billion in wage increases for the company. UPS may raise rates to cover increased labor costs.


Additionally, dockworkers at West Coast ports agreed to wage increases of 8 to 10 percent on a settlement agreement with port operators, meaning freight rates for imports from Asia could increase again.


Container Prices


According to the Wall Street Journal, the average spot rate for a 40-foot box from China to the USA West Coast has risen 61% this summer. So far, the price increases have been absorbed, but if prices continue to rise, the cost of containerized freight from China could increase.


The Panama Canal


The Panama Canal, which is the main route for importers shipping from Asia to the East Coast, is at record low levels, causing container ships to be forced to back up, unload most of their cargo to reduce weight, or even switch to other routes as if they were bypassing South America to reach the East Coast. According to Reuters, as a result of all these factors, current freight rates have risen by 36 percent.


All of these factors could lead to another increase in freight costs. More details check here.



Source: 

https://blog.dallasmarketcenter.com/freight-costs-are-on-their-way-back-up-plan-accordingly


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