The rebound in container shipping demand seems to have given many in the shipping industry the excuses they have been looking for to inflate prices and there has been much 'rattling of sabres' to this effect.
For example, there has been plenty of talk in the sector about a shortage of actual containers exacerbated to a degree because container manufacturers cut production during the recent economic crisis. However, this potential problem has been eased by the shipping lines themselves actively repositioning empty stock to meet demand wherever it is.
There has also been an attempt by the shipping lines to control available space through restricting capacity; and this is probably best demonstrated by their seeming reluctance to reintroduce the promised previously mothballed vessels.
We are now in what the shipping sector calls the 'peak season' and, while there continues to be a growth in Far East trade, it seems that a combination of the strength of the US dollar, US trade news and continued Chinese inflation is working to keep costs in line.
Despite this, the shipping lines are continuing to actively threaten rate rises or what they, more euphemistically, label as 'peak season surcharges'. Many in the import/export sector are becoming increasingly frustrated at these proposed surcharges, due to market conditions that many would say are of the shipping lines' own making and in whose hands the answers lie. With the laws of supply and demand, if things are not better managed by the shipping lines, they could easily see custom drift away to competitive and alternative suppliers.
So it has seldom been more important for meat importers and exporters to work with the right freight forwarder, who can insulate them from the potential fall-out of these turbulent times.
27 October, 2016, 8:30
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