Shipping Cost Doubles Within a Week 

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Shipping Cost Doubles Within a Week 

September 9: Shipping companies have increased the shipping and container charges for overseas trade. Traders say that the transportation cost, which has been rising since the outbreak of Covid-19, is now at an all-time high.

Importers say that container fares have also doubled in the first week of September. Ashish Lath, an importer, said that the container charges that were between USD 3500 to 4000 while importing goods from the Chinese port to Birgunj dry port until August has spiked to USD 8000.

Traders said that the increase in fares is due to the imbalance in the supply and demand of containers globally. Containers have been in short supply in European and American countries since the beginning of September.

Lath, who is also the secretary of Birgunj Chamber of Commerce and Industry, said that the shipping companies have increased the fares by taking advantage of this opportunity. According to the traders, shipping companies have been raising fares since March last year amid the Covid-19 crisis.

Importers can't get the containers even after paying USD 8,000 at the Chinese port, said Secretary Lath.

‘Until a year ago, 20-ton containers were being transported from the Chinese port to Birgunj for 1,500 to 2,000 dollars. The fare, which was up to USD 4,000 last month, has started to increase this month,” said importer Navneet Agrawal.

According to Omprakash Moure, there is a shortage of containers in China and Europe as more containers are 'booked' from Chinese ports due to increased demand for goods in Europe and the United States during the New Year and Christmas.

"Containers are in short supply as Chinese traders increase their supply to Europe and the United States. It has had an impact on our business as well,” said Moure.

According to Sushant Chachan, coordinator of the Dry Port and ICP Committee of the Birgunj Chamber of Commerce and Industry, the lack of containers has also affected cargo coming from US and European countries.

Chachan, the joint secretary of the union, said that the demand in the US and Europe has increased and the containers from China have stopped there.

"It's a result of imbalance between supply and demand. At present, the transportation cost alone has reached 30 percent of the total price of the goods. It should be 10 percent," Chachan said.

Prices of groundnuts and pulses from the United States and Canada have risen sharply. The price of such items has already gone up by 30 percent. Importers say it is likely to go above 60 percent due to a spike in transportation costs.

The Covid pandemic has hampered labor supplies at ports and delayed loading and unloading, argue traders.

They shared that the cost of transportation is high as ships have to wait for 15-20 days at the port.

 

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