• No products in the cart.

What are container prices and why are they skyrocketing?

When we talk about container prices, this refers to the costs of shipping a container overseas. These transport costs are increasing enormously in the current climate and are passed on to price increases in stores. Companies in Belgium today pay up to ten times the price for the transport of a sea container with goods from China. Up to $24.000 dollar is now being charged for a container, where that amount used to be between $1.800 and $2.200 dollar. These price increases are not related to the delay in goods transport, which sometimes takes weeks.

In the Netherlands, the costs are also rising starkly. Where a container first cost about €600,- euro before the outbreak of the pandemic it is now up to €15.000,- euro a year and a half later. Experts also foresee price increases in stores in the future, which will probably not return to the pre-pandemic level. The reason given for this is that the container market is in the hands of handful of globally operating shipping companies that work together

For many companies, there are also no alternatives available for transport by sea, as transport by air to too expensive. Finding suppliers closer to home is also not an easy task for many companies in the short term.

International container transport has been disrupted since the start of the Covid crisis. China immediately closed its ports after the first outbreak, with container terminals being closed as soon as an outbreak occurs. The failure of terminals triggered a domino effect in which containers ended up in places where they were not needed and large shipping companies took some of their ships out of service, causing later routes to get stuck.

The catching-up that is needed to deliver all the goods is not yet complete, not helped by the container ship that ran aground in the Suez Canal in March. Many containerships have been delayed and container rental prices have skyrocketed. It will be impossible for various stores not to increase the prices of items. Companies have few options, unless they are multinationals. For example, the U.S. department store giant Walmart has started to transport its own containers on empty ships and the Dutch company Hema is also using its own network to prevent price increases. For the smaller companies that rely on container transport for their products, there is little to do except face ‘the new normal’ and go along with it.

February 17, 2022
2021 © Mediya.nl. All rights reserved.