Freight congestion is pushing up prices and costing companies

Freight congestion is pushing

Freight congestion is pushing up prices and costing companies

Freight congestion is another factor for buyers to take into account when getting goods onto shelves and minimising the impact on consumers. The shipping surge is keeping freight rates high and starting to hit exporters, manufacturers and the increase in costs are being passed onto consumers. Its critical for buyers to factor these into product margins and to make sure they are getting the best cost and the most efficient service.

Christmas shopping is well underway and since lockdown retail spend is up on last year (see graph 1).

monthly spend chart

This means import volumes are extremely high as retailers restock inventory and that is causing delays and adding costs. This volatility and capacity constraints are overwhelming some NZ ports (Congested ports cause shipping delays) and worldwide it’s causing a shortage of empty containers at Asian origins (see graph 2).

Ships are waiting offshore (not only in NZ) for a slot to open at the port so they can unload their containers. This is also impacting exporters as some carriers are prioritising getting empty containers back to Asia quickly, instead of waiting to load exported goods. The freight crunch is also felt in the sky, as air rates were up in November and capacity is limited.

We achieve great results for our customers. Contact us to discuss how we can help you

Related Posts

Why Wouldn’t You??!

We started eTrade Procurement so we could offer New Zealand businesses an easy
Read More

how businesses recover

Lockdown in New Zealand had almost started to feel like a surreal part of 2020 history
Read More
Reverse Auction

Reverse Auctions: Efficient, Collaborative and Easy to Use.

Modern reverse auctions are a far cry from those of the past. They no longer represent a cutthroat race to..
Read More