The UN yesterday warned that a surge in container freight rates could mean higher prices for consumers next year unless COVID-19 pandemic-fueled problems are untangled.
The UN Conference on Trade and Development (UNCTAD) said that global import price levels could increase by 11 percent and consumer price levels by 1.5 percent between now and 2023.
“Global consumer prices will rise significantly in the year ahead until shipping supply chain disruptions are unblocked and port constraints and terminal inefficiencies are tackled,” UNCTAD said in its Review of Maritime Transport 2021 report.
Global supply chains faced unprecedented demand from the second half of last year onwards, as consumers spent on goods rather than services during COVID-19 lockdowns.
However, the upswing in demand hit several practical constraints, including container ship carrying capacity, container shortages, labor shortages, congestion at ports and COVID-19 restrictions.
The mismatch led to record container freight rates “on practically all container trade routes,” the report said.
“The current surge in freight rates will have a profound impact on trade and undermine socioeconomic recovery, especially in developing countries, until maritime shipping operations return to normal,” UNCTAD Secretary-General Rebeca Grynspan said.
“Returning to normal would entail investing in new solutions, including infrastructure, freight technology and digitalization and trade facilitation measures,” she said.
UNCTAD said the pandemic had magnified pre-existing industry challenges, particularly labor shortages and infrastructure gaps.
It also exposed vulnerabilities, such as when China’s Yantian Port shut in May due to a COVID-19 outbreak, causing significant delays, or when the giant container ship Ever Given blocked the Suez Canal in March, snarling global trade.
Still, the pandemic’s impact on maritime trade volumes last year was less severe than initially expected, UNCTAD said.
Maritime trade contracted 3.8 percent to 10.65 billion tonnes last year, and is projected to increase 4.3 percent this year.
UNCTAD said the medium-term outlook remained positive, but was subject to “mounting risks and uncertainties.”
The agency predicted that annual growth would slow to 2.4 percent between next year and 2026, compared with 2.9 percent over the past two decades.
“A lasting recovery ... largely hinges on being able to mitigate the headwinds and on a worldwide vaccine roll-out,” Grynspan said.
“The impacts of the COVID-19 crisis will hit small island developing states (SIDS) and least developed countries (LDCs) the hardest,” it said.
The rise in consumer prices is expected to be 7.5 percent in SIDS and 2.2 percent in LDCs.
Contending with lockdowns, border closures and a lack of international flights, hundreds of thousands of seafarers have been stranded at sea, unable to be repatriated or replaced, UNCTAD said.
The UN agency urged governments and industry to work together to end the crew change crisis in the sector, which employs more than 1.9 million people worldwide.
UNCTAD also said the vaccination rate of seafarers was about 41 percent and called for them to be jabbed as a priority.
“This is not acceptable if we want to see the supply chains moving again,” UNCTAD technology and logistics director Shamika Sirimanne said.
While bottlenecks have hindered the economic recovery, the pandemic could trigger far-reaching transformations in maritime transport, UNCTAD predicted.
The crisis has activated digitalization and automation, which should, in turn, deliver efficiency and cost savings.
E-commerce — accelerated by the pandemic — has changed consumer shopping habits and spending patterns, the report said.
“This could generate new business opportunities for shipping and ports,” it said.
‘OUT IN FRONT’: The new investment is part of MediaTek’s bid to expand revenue by 15 percent over the next three years from an estimated US$17 billion this year MediaTek Inc (聯發科) is to continue investing in the development of low-power technologies to maintain its leading position in the industry over the next 10 years, the Hsinchu-based chip designer said yesterday. This year, it would allocate US$3.3 billion to the research and development of technologies related to high-performance computing, low power and advanced chip packaging, MediaTek said. The investment is part of the chip designer’s efforts to enhance its technological capabilities and boost revenue. MediaTek aims to expand revenue by about 15 percent over the next three years from an estimated US$17 billion this year. “We are definitely out in front of
PharmaEssentia Corp (藥華醫藥) shares have jumped 80.56 percent since the company obtained a US polycythemia vera (PV) drug license for its new interferon drug Besremi (ropeginterferon alfa-2b-njft) on Nov. 12. Shares on Friday closed at NT$195 in Taipei trading, up from the stock’s closing price of NT$108 on Nov. 12. PV is a rare, chronic and life-threatening blood cancer linked to a stem cell mutation in the bone marrow that results in an overproduction of blood cells and places sufferers at risk of having a blood clot, stroke or heart attack. PharmaEssentia is preparing to make Besremi available in the US in the
The US$410 DeliSofter pot looks much like the rice cookers ubiquitous in Japanese households and it does prepare rice in 24 minutes. However, this invention of two Panasonic Corp engineers is designed to do more and help people with swallowing difficulties. The two women led the creation of a spin-off company, Gifmo Co, to sell the specialized steam cooker, which they say can turn fried chicken soft enough to be sliced with a potato chip. The machine works by first cutting into food with a series of blades and then subjecting it to extremely high pressure at a temperature of 120°C,
Industrial metals plunged and gold rallied as the emergence of a fast-spreading and highly mutated SARS-CoV-2 strain sparked a sell-off across financial markets. Base metals, including copper and aluminum, fell more than 3 percent in London as investors weighed the risk that the new variant identified in South Africa might spur fresh outbreaks and derail growth in the world’s leading industrial economies. Scientists say it carries a high number of mutations that could make it more effective at evading existing vaccines. The new strain creates fresh risks to the outlook for metals demand, imperiling a recent rebound in prices driven by chronic