In short supply! Freezer freight rates have skyrocketed!

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It is reported that from April 1, the shipping company Hapag-Lloyd will increase the freight rates of general and refrigerated containers from Egypt to Latin America.

In December last year, Hapag-Lloyd stopped accepting bookings for 40-foot refrigerators from five Central European countries until the end of the year. So far, the new year has not brought any obvious relief. On the contrary, according to Drewry, the Chinese authorities’ testing of refrigerated containers for the new crown virus has blocked thousands of containers in ports.

The increase in the rate of refrigerated containers also indicates that shippers of perishable goods will face greater pain.

As with 20-foot and 40-foot ordinary sea containers, due to the decline in port productivity due to Covid-19 measures and subsequent terminal congestion, the circulation of containers has slowed down, and refrigerated containers are also facing supply shortages and lagging demand.

Drewry Shipping said that as demand in the refrigerated industry is growing faster than general commodities, these problems have hit the reefer industry particularly severely.

Shippers around the world are struggling to obtain enough boxes to transport perishable items, and shipping time has been severely interrupted.

Now, it takes 45 days or more to transport agricultural products from Chennai to Thailand, while it takes 18 days before the transportation is interrupted. Similarly, the shipping time of seafood from Southeast Asia to Japan has increased significantly. In addition to the shortage of refrigerated containers, the transit stations also lack usable plugs.

According to data from the Australian Dairy Federation, Victoria’s dairy exports are facing a month-long delay, while shippers of North American agricultural products have severely criticized shipping companies, accusing them of shipping empty boxes to China instead of Export American goods.

The conditions on the road are not much better. In the United States, trucking company RPM Logistics recently diagnosed that “continuous supply chain disruptions and above-average spot prices are largely refrigerated goods.” The company advises shippers to prepare for the high transportation costs caused by the lack of refrigerated trailers on the market.

The company believes that the distribution of the Covid-19 vaccine will further weaken the supply of refrigerated trailers for perishable food.

At the same time, container manufacturers are striving to increase production. In the latest “Container Market Outlook” last month, Drewry predicted that the production of refrigerated containers will remain at a record level until 2024. Last year, the global reefer container capacity was estimated to have increased by 300,000 teu, roughly the same as the average production in recent years.

The shortage of refrigeration equipment is not new in the industry: in the past few decades, there have been some signs of shortages, the most recent being in early 2018. The current predicament is expected to continue to plague the industry for some time. Most forecasts of the availability of refrigerated containers believe that at least no improvement will be seen before the middle of the year.

This article is reproduced from State Reading Network.

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