INFRASTRUCTURE
Indian exporters likely to be hit by container shortage again amid US-China trade war
- IBJ Bureau
- Sep 16, 2024
Indian exporters may face yet another round of container shortages, compounded by already soaring freight costs. The imminent scarcity comes amid reports of China cornering all available container capacity to push as much shipments to the US and Europe ahead of upcoming tariff hikes, notes Global Trade Research Initiative (GTRI).
Adding to this strain are shipping delays at Indian ports, triggered by congestion at the Singapore port. Some shipping lines are even skipping Indian ports, exacerbating the issue of container availability and leaving exporters stranded. The Federation of Indian Export Organisations (FIEO) has highlighted these concerns in a recent meeting with the Ministry of Commerce and Industry.
Freight costs for Indian exporters shipping to Europe and the US have more than doubled in the past year, largely due to disruptions in the Red Sea. Indian exporters may soon face further disruptions if the US-China trade war intensifies, warns the global think-tank.
Between 2022 and 2024, shipping rates for a 40-foot container fluctuated significantly. In 2022, the average cost was $4,942 – driven by the pandemic’s lingering effects – while by 2024, the rate had stabilised at around $4,775. These prices are still much higher than the pre-pandemic rate of $1,420 in 2019, reflecting ongoing supply chain challenges that continue to strain global trade.
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