HomeBusinessExporters fret over surging freight rates, delays at ports

Exporters fret over surging freight rates, delays at ports

Freight rates have began growing as soon as once more after remaining regular in December, rising 10% within the first week of January, elevating contemporary issues for exporters of basmati rice, tea, apparel and leather-based items amongst others.

The ready time of consignments at ports has additionally elevated to greater than a month from 15 days, trade insiders mentioned.

Mohit Agarwal, director at Asian Tea & Exports, mentioned freight charges to locations like Iran and Kazakhstan have gone up by $500-1,000 per container over the final 10 days. “We do not know what is driving this fresh surge in freight rates,” he mentioned. “The consignments are lying at the ports for a month or more at times.” Agarwal mentioned he doesn’t see freight charges cooling off within the quick future.

Some exporters that ET spoke with mentioned they plan to cross on the rising value to customers ultimately.

“The container freight rates have gone up by 3-4 times as compared to last year. This cost will eventually be passed on to consumers in the coming days,” mentioned Ashwani Arora, CEO of LT Foods that owns rice model Daawat.

“However, we are not seeing any delay in delivery time to the consumer since LT Foods has made investment in automation, which has reduced the turnaround time of the container,” he mentioned.

Ramesh Juneja, regional chairman of Council Leather Exports, nevertheless, mentioned leather-based items exporters aren’t positive whether or not they’ll have the ability to cross on the rising freight value to patrons in Europe and the US as there may be a whole lot of uncertainty because of the unfold of Covid-19.

Exporters additionally raised concern over demand. “Rising freight cost is a global phenomenon,” mentioned Ajay Sahai, director common of Federation of Indian Export Organisations (FIEO). “However, what is more important is how the export markets behave in the next fortnight in view of a surge in Covid cases.”

India achieved its highest-yet month-to-month exports of $37 billion in December, registering a bounce of 37% yr on yr. The authorities has mentioned the nation is on monitor to attain an export goal of $400 billion, including that the highest 10 main commodity teams constituting 80% of exports grew 41% yr on yr final month.

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