Sponsored By

Intra-Asia rates add to manufacturing cost inflation

Higher spot container freight costs for intermediate goods in Asia are adding to inflating costs for goods manufacturers.

Gary Howard, Middle East correspondent

January 21, 2022

1 Min Read
SIPG yangshan
Photo: SIPG

Supply chain visibility company Xeneta noted an increase in spot rates from China’s main hubs to South Korea and Japan; spot rates on these trades averaged $640 per feu in 2020,  $1,400 in 2021 and $1,800 in the first half of January 2022.

“Considering that many of the goods on these intra-Asian trades are intermediate goods moving between factories in the region, doubling spot freight rates can often add considerable costs to the manufacturing process, forcing manufacturers to reconsider their manufacturing and supply chains across the region,” said Xeneta chief analyst, Peter Sand.

Long term rates from China to Japan and South Korea also rose average $2,150 per feu over the past three months, more than double the $1,000 per feu for routes from Japan and South Korea to China. The difference in backhaul trades is pronounced; rates in the first half January 2022 from Japan and South Korea to China fell to around $800 per feu from an average of $1,700 in January 2021.

Xeneta also noted an increase in cost premium for sending goods from China’s smaller ports to South Korea and Japan; the premium stood at $100 per feu in 2020 and was $500 per feu for the first weeks of January, “potentially opening up savings opportunities for shippers if they can secure land transport to the major ports,” said Sand.

Related:Shippers challenge container line demurrage fees in US courts

“It will be vital to have options if the first port of choice is unavailable to keep the goods moving, given the sudden lockdown situation of a few ports in China.”

About the Author

Gary Howard

Middle East correspondent

Gary Howard is the Middle East Correspondent for Seatrade Maritime News and has written for Seatrade Cruise, Seatrade Maritime Review and was News Editor at Lloyd’s List. Gary’s maritime career started after catching the shipping bug during a research assignment for the offshore industry. Working out of Seatrade's head office in the UK, he also produces and contributes to conference programmes for Seatrade events including CMA Shipping, Seatrade Maritime Logistics Middle East and Marintec. 

Gary’s favourite topics within the maritime industry are decarbonisation and wind-assisted propulsion; he particularly enjoys reporting from industry events.

Conferences & Webinars

Gary Howard regularly moderates at international maritime events. Below you’ll find a list of selected past conferences and webinars.

Get the latest maritime news, analysis and more delivered to your inbox
Join 12,000+ members of the maritime community

You May Also Like