- Empty containers are piled up at ports in Australia and New Zealand; containers are scarce at India’s port of Kolkata.
- It is forcing makers of electronics parts to truck their wares more than 1,000 miles west to the port of Mumbai, where the supply is better.
- Off the coast of Los Angeles, more than two dozen container ships filled with exercise bikes, electronics and other highly sought imports have been idling for two weeks.
Peter S. Goodman, Alexandra Stevenson, Niraj Chokshi and Michael Corkery write for the Economic Times about the chaos in global shipping due to the container ship idling.
Americans stuck in their homes
Americans stuck in their homes have set off a surge of orders from factories in China, much of it carried across the Pacific in containers — the metal boxes that move goods in towering stacks atop enormous vessels.
As households in the United States have filled bedrooms with office furniture and basements with treadmills.
The demand for shipping has outstripped the availability of containers in Asia, yielding shortages there just as the boxes pile up at U.S. ports.
Piled up empty containers
Empty containers are piled up at ports in Australia and New Zealand; containers are scarce at India’s port of Kolkata.
It is forcing makers of electronics parts to truck their wares more than 1,000 miles west to the port of Mumbai, where the supply is better.
The chaos on the seas has proved a bonanza for shipping companies like Maersk, which in February cited record-high freight prices in reporting more than $2.7 billion in pretax earnings in the last three months of 2020.
Another example of container chaos
Peter Baum’s company in New York, Baum-Essex, uses factories in China and Southeast Asia to make umbrellas for Costco, cotton bags for Walmart and ceramics for Bed Bath & Beyond. Six months ago, he was paying about $2,500 to ship a 40-foot container to California.
“We just paid $67,000,” he said. “This is the highest freight rate that I have seen in 45 years in the business.”
Containers aggressively moved
In recent weeks, shipping carriers have aggressively moved empty containers to Asia, increasing availability there, according to data from Container xChange, a consultant in Hamburg, Germany.
Some experts assume that as vaccinations increase and life returns to normal, Americans will again shift their spending — from goods back to experiences — reducing the need for containers.
Did you subscribe to our daily newsletter?
It’s Free! Click here to Subscribe!
Source: Economic Times
