There is some relief among exporters due to a notable decrease in shipping costs, particularly in the US-Europe market. However, a lot of people think that this has happened at the worst possible moment, when the global markets are slowing down.
While Europe is regulating at roughly $2300 and $2700, respectively, the USEC now charges $3000 for 20-foot containers and $3500 for 40-foot containers. Reduced direct sailings to ports such as Kochi demonstrate the severe impact on the freight traffic. While Tirupur exporters are somewhat benefiting from the decline in Bangladeshi shipments, there hasn’t been a noticeable rise in volume.
The volume decline forced the big participants to attest to the available volumes in the Indian market, despite their best efforts to maintain the rate levels. This sparked a pricing war as large competitors competed to draw in the few available market volumes. Liner companies can provide reduced charges because their offers aren’t particularly unique. A mixed picture is presented by the falling freight rates. Lower transportation costs may provide a company a competitive advantage in international markets, but they can reflect market volatility and broader economic risks. Although the industry would benefit from lower transportation costs, sources in the seafood exporters’ community stated that the decline has not yet reached the previous level. With a reported decline in consumption, the US market is already dealing with muted demand.
